12/07/2007 1:00AM

Letters to the Editor

EmailNew York should look to the East for a plan to prosper

Why is Hong Kong off to the races while New York is stuck in the mud?

While politicos butt heads in the state capital of Albany over who gets to operate the state's "failing" Thoroughbred horse racing franchise at the end of the year, Hong Kong has built a better mousetrap.

In 2006-2007, at the same time NYRA filed for bankruptcy protection, the Hong Kong Jockey Club contributed approximately $1.6 billion (U.S.) in taxes to government coffers. And it has donated an average of $128 million annually to local charities over the last 10 years.

Hong Kong's success lies in its business model. Unlike the not-for-profit model under which NYRA has struggled since 1955, the Hong Kong Jockey Club operates under a not-for-profit structure that provides for retained earnings.

It pays a regulated minimum tax annually to its government, spends whatever it sees fit to operate and upgrade its facilities, invests in technology, marketing, etc., and donates its surplus to the community through a charitable trust.

NYRA, which must hand over its earnings to the state, has not had the luxury of reinvesting in its racetracks, opting instead to use its limited resources to maintain the quality of its racing.

The franchise has also been hobbled by governmental constraints that prevented it from making business decisions regarding takeout, rebates, and Internet wagering that would increase its business, and by the inexplicable delay in approvals to install video lottery terminals at Aqueduct.

At a public hearing regarding the franchise held in Manhattan last year, a Del Mar vice president, Craig Fravel, testified that the key ingredient in the success at Del Mar, a not-for-profit with retained earnings, is that all proceeds are reinvested in the track ("New York hearings focus on profits," Jan. 27, 2006), and emphasized that his organization is free from political meddling.

That is not the case in New York, where it is no surprise that the dogfight over who will get the Thoroughbred horse racing franchise breaks along party lines and the debate is less about racing than a political spitting contest between the Democratic governor and the state's Republican Senate majority leader.

Neither side acknowledges the state's role in NYRA's problems or the promise that a not-for-profit business model featuring retained earnings might hold to maximize contributions to the state without compromising New York's brand of world class racing.

Eileen Morrison - Franklin Square, N.Y.

Snub of Oaklawn doesn't sit well

Steven Crist's Dec. 2 column, "Arkansas Derby deserves better grade," regarding the shabby treatment received yet again by the Arkansas Derby at the hands of the North American Graded Stakes Committee, was right on.

During my patronage of Oaklawn during the past 25 years, I have watched the product ebb and flow. Thanks to increased purses - admittedly attributable largely to the track's "games of skill" (as the push-button Instant Racing gambling machines that now occupy far too much space at the track are called) - and management's renewed efforts to attract better horses and horsemen, Oaklawn certainly seems to have experienced a return to the quality of racing it displayed in the the 1980's at all levels.

The graded stakes committee's inexplicable refusal to restore the Arkansas Derby (as well as the Oaklawn Handicap) to Grade 1 status gives the now-ubiquitous "duh" new meaning.

Jim Mainard - Ozark, Ark.

Time to put 'Shobiz' back on main track

Trainer Barclay Tagg's turf-racing experiment with Nobiz Like Shobiz should be over after his eighth-place finish in the Hollywood Derby. Time to turn him back to the main track.

Nobiz Like Shobiz could wind up loving a synthetic racing surface, but he's not Showing Up, who has prospered since Tagg switched him to grass after his sixth-place finish in the Kentucky Derby. When Curlin - a maiden back in February - won the Breeders' Cup Classic, it could have been "Nobiz."

Nobiz Like Shobiz deserves a 4-year-old season on the dirt in Grade 1 company, getting back to the original plan.

Dave Musselman - Dallas