The California Horse Racing Board (CHRB) regulates horse racing and betting at licensed race tracks (called parimutuel). It also licenses and supervises racing associations, horse owners, veterinarians, trainers, jockeys, grooms and others involved in the sport. The racing board collects professional fees from granting licenses to the participants, and takes a portion of the revenue from betting and admission fees at the tracks. It has a quasi-judicial function, hearing complaints about misconduct, issuing rulings and imposing fines or other sanctions on those it finds guilty of violating its rules. The board sets schedules for racing seasons and oversees the operation of six of the state’s racetracks, granting the rights to companies or organizations to conduct horse races at Golden Gate Fields, Del Mar, Hollywood Park, Santa Anita and Los Alamitos, as well as at eight county fairgrounds. It also serves as liaison with other states, coordinating rules and regulations and enabling off-track betting across state lines. The board consists of seven members, who are appointed by the governor and approved by the state senate. Each member serves a four-year term. The board is currently independent, but is transitioning to the new Business, Consumer Services and Housing Agency by mid-2013.

2009-10 Annual Report (Horse Racing Board website) (pdf)

2008-09 Annual Report (Horse Racing Board website) (pdf)

In 1933, voters approved Proposition 3, which legalized parimutuel wagering on horse racing in California. Parimutuel is a French term that literally means equal stake. In a parimutuel betting system, each participant contributes to a pool of bets, with odds determined based on the betting. The winnings are then divided among those choosing the top three race winners, minus fees for the organizers and prizes for the racers. Parimutuel betting is used for gambling on horse racing, greyhound racing and jai alai, and has been in use since the 19^th century.

The legalization of parimutuel betting was in part driven by the advance of technology, notably the development of the totalizator, commonly called a tote board, in the 1920s. The device counts money, records ticket sales and bets, computes the odds, and displays the information on a message board. Developed in New Zealand, the first totalizators installed in the United States were at Hialeah Park, Florida, in 1932 and at Arlington Park, Chicago, in 1933. The installation of the tote boards spurred growth in horse racing by providing the public with a safe alternative to using illegal bookmakers to bet on races. In 1933, California was among the first states to legalize parimutuel gambling on horse racing as a means of regulating the industry and gaining revenue. Dozens of states followed suit over the next decade.

With the implementation of off-track betting in recent decades, which made gambling on horses available outside the confines of the race track, the racing board established a system of state-run or authorized betting parlors, called Simulcast, usually located at casinos or county fair race tracks. In 2001 online betting, known as Advance Deposit Wagering, or ADW, was authorized by Assembly Bill 471 and took effect in 2002.

The racing board has been struggling for the past decade to deal with declining interest in its sport. Economic stagnation, competition from other forms of gambling and other sports, changing public tastes, and an increase in horse injuries and deaths (many of them high-profile) have all hurt attendance and betting. In the fiscal year ending in June 2010, total handle – the amount wagered in California and bet in other racing jurisdictions and merged into state pools – was down 12.7% from the preceding 12 months.

History of the Board (Online Archive of California)

CHRB's Year-End Report Holds More Grim News (by Jack Shinar, BloodHorse)

The seven-member board operates through an executive director, who is responsible for the department’s operations and regulation of the horse-racing industry.

Legislation and Regulations

Key among the board’s duties is the enactment and enforcement of regulations. Often the regulations are a result of action on the part of the state legislature. In other cases they are rules imposed by the board itself. In 2010, 10 pieces of legislation had a direct effect on horse racing in the state and required action on the part of the board. The most significant of the bills was SB 1072, authored by Democratic state Sen. Ronald Calderon, which permits exchange wagering in California, a radical change in the method of gambling. Exchange wagering allows people to bet directly against one another, set their own odds and the amount bet, and even gamble on races that are in progress. This aspect of the bill isn’t scheduled to take effect until May 1, 2012. The bill also authorized the board to increase the amount of takeout from the pool of money bet on races. Takeout is the amount of money removed from the wagers used to pay for expenses such as taxes, betting duties, operating expenses and purses for races. It also generates profit for the operators of the track. The increased takeout has been met with a storm of criticism in the press and among the gambling public.

The board also imposed its own new regulations in 2010, including changes in fees and winnings for jockeys, and requirements for the use of helmets and safety vests for track personnel. The board prohibited the use of certain drugs by veterinarians and defined a method of testing horses to detect the use of drugs.

Calif. OKs Exchange Wagering, Takeout Hike (by Jack Shinar, BloodHorse)

Enforcement

The racing board employs special investigators who conduct field inquiries into suspected violations of regulations. The investigators also perform background investigations of license applicants, and assist the stewards in gathering information regarding drug testing and medication. The results of the investigations may be used in hearings before the board or in civil or criminal cases.

Complaints For Class 1, 2 & 3 Drug Violations (Horse Racing Board website)

Accusations Of Class 1, 2 & 3 Drug Violations (Horse Racing Board website)

Licensing

From July 2009 to June 2010, the board issued 9,193 new or renewal licenses to everyone from security guards to veterinarians, jockeys and stable owners, and generated revenue of over $900,000 in the process. License applicants are screened for disqualifying criminal histories through California’s Department of Justice and FBI databases. The licensing program is comprised of two racing license supervisors and eight racing license technicians. A field licensing office is also in place at any venue a meet is held.

Racing Supervision

The board selects and contracts with three stewards for each race meeting. The stewards are responsible for conducting race events with the assistance of associate judges, paddock judges, patrol judges, starters, clerks of scales, official veterinarians, racing veterinarians, horse identifiers, horseshoe inspectors and timers. In addition, associate stewards liaise between the stewards in the stand and racing board investigators on the backstretch. The stewards are also responsible for conducting administrative hearings involving infractions of regulations and for making recommendations to the board for disciplinary action.

At the end of a race meet, the stewards prepare and issue a report to the governor and the board detailing the event, reporting on the total handle, results and administrative action such as fines or penalties enacted during the meet.

2011 Racing Schedule

The board’s relatively modest budget of just $11.7 million is used for payroll and benefits for a staff of 58 ($4.4 million) and for operating expenses and equipment ($7.3 million). The board has no programs which dispense money. Its funding comes from licensing and fees it collects from the racing industry. Any excess becomes part of the state’s general fund.

3-Year Budget (pdf)

Boycott Over Takeout

The Horseplayers Association of North America on January 12, 2011, called for a nationwide boycott of California thoroughbred racing over passage of SB1072 and the increase in takeout (the racetrack’s share of the betting). Takeout increased by 9.7% to 22.68%, depending on the type of wager, giving California one of the highest takeout rates in North America.

“Horseplayers have been kicked around long enough,” said Jeff Platt, president of the Horseplayers Association of North America (HANA), which represents 1,500 members who bet $65 million annually. “The California Horse Racing Board approved the takeout increase figuring that players would just complain and go along like sheep. But, partly thanks to word of mouth and partly to players who are willing to stand up for what they believe in, handle has dropped precipitously at Santa Anita.” HANA claims the boycott is succeeding and that the handle—which is the total amount of money bet—at California tracks is down by almost $100 million.

Platt explained what that means for the bettor. “The average takeout on win, place, show, wagers nationwide … is about 25% … meaning that a newbie bettor not knowing anything about handicapping … can expect to see a long term return of about 75 cents for each dollar wagered. That same bettor can go to a casino and see a return of more than 98 cents for each dollar. The same bettor can feed tokens into a slot machine and see a return of more than 91 cents for every dollar.”

Racing board Chairman Keith Brackpool disagreed and said the added takeout will produce $30 million a year and increase overnight purses by 25% to 30%, benefiting gamblers.

Group Calls for Betting Boycott (by Ed Zieralski, San Diego Union-Tribune)

Disaster at Santa Anita (by Bill Finley, ESPN)

What Is Takeout and Why Is It Controversial? (Case the Race)

Conflict of Interest

Racing board members are permitted to own thoroughbred horses that compete in the state, raising questions about potential conflicts of interest. The Orange County Register reported in 2006 that “California is the only major horse-racing state in the nation that permits all of its board members to race horses in the state, despite criticism that policy-makers are too vested in the industry to be unbiased.” When Harvey Furgatch was appointed to the board in the 1970s, he took the unusual step (unusual then and now) of shipping his stable of horses to the East Coast to race, to avoid the appearance of using the board for personal gain. “It was a pretty clear thing for me,” he told the San Diego Union-Tribune.

The state legislature has on occasion taken note of the issue, as well. In 2005, Democratic Assemblyman Lloyd Levine of Van Nuys introduced legislation that would have prohibited members of the board from holding any financial interests in state horse racing. The bill was dropped in exchange for a promise from the board that it would draft its own conflict-of-interest rules. It didn’t. Two years later, state Sen. Leland Yee of San Francisco introduced legislation which would have limited the number of board members who have a vested interest in horse racing to three. It didn’t pass.

The Horseplayers Association of North America in December 2010 said the board’s conflicts of interest have led to a decline in support of horse racing in the state. HANA claimed the board is dominated by horse owners and reiterated the charge that only California allows so many owners to sit on the board that governs the sport they compete in. The association argued that “a number of California state boards also prohibit such conflicts of interests by barring those in the industry from serving as members, including the Medical Board, Dental Board, Board of Optometry, and Board of Accountancy.”

The racing board currently relies for conflict-of-interest guidance on Rule 2000, passed in 2003, which adopts the general ethics requirements as put forth by the state Fair Political Practices Commission. When Keith Brackpool became chairman of the board in 2010, he replaced John Harris, one of the leading thoroughbred owners and breeders in California. Brackpool is also a horse owner.

Bad Bets: With One Foot in the Stirrup (by Tony Saavedra, Scott M. Reid and Robert Kuwada, Orange County Register)

Many on Horse Racing Board Have Stake in Industry (by Brent Schrotenboer, San Diego Union-Tribune)

Legislation to Curb Conflict Introduced – Again (by Brent Schrotenboer, San Diego Union-Tribune)

HANA: CHRB Dominated by Narrow Interests (Paulick Report)

Critics Call Ties a Clear Conflict of Interest (by Brent Schrotenboer, San Diego Union-Tribune)

Sexual Discrimination Lawsuit

The racing board settled a lawsuit charging it with sexual discrimination for $400,000 in July 2010. In a 2009 lawsuit filed in Sacramento County Superior Court, former steward Pamela Berg alleged the board gave preference to less qualified male stewards. She claimed that male stewards were given assignments to the state's larger racetracks and that her contract was not renewed due to her earlier claims of discrimination.

CHRB to Pay Former Steward Pam Berg $400,000 (by Jack Shinar, BloodHorse)

One Board to Rule Them All

Between 2004 and 2009, commissions collected by racetrack operators and winning purses for horse owners declined about 12%, according to the racing board’s own numbers. During the same period, attendance at racetracks and simulcast facilities in the state dropped 25%. As horse racing declines in popularity, some of the sport’s enthusiasts have suggested that a national authority in place of one in California would help reverse the trend.

“We need one central organizing body,” says Craig Bandroff, an owner of a horse farm, “not a myriad of states regulating the industry.” Breeder Rob Whiteley agrees and wants legislation to establish uniform rules and regulations “similar to the office of the commissioner of the National Football League or Major League Baseball.” Former jockey and TV commentator Richard Migliore says, “I believe we need a national racing commission that would create and enforce uniform rules pertaining to every facet of racing from riding infractions to medication violations. There is nothing more important than our reputation and our credibility.”

Tim Cavanaugh of Reason Magazine is even more blunt: “Why does bankrupt California maintain a government horse racing board?”

Safety Initiatives

Who is going to say “no” to Bo Derek?

The actress, star of the movie “10” and a commissioner on the horse racing board, is chairperson of a committee tasked in April 2011 with finding ways to increase horse safety at the track. “I’ve been on this board for more than 2 1/2 years now, and I’m surprised by how content everyone is with the rules regarding the welfare of horses,” Derek said, inviting stakeholders to call her “and offer ways to make things better for the horse.”

The Medication and Track Safety Committee has already outlined six proposals it would like to pursue as it invests $1 million with the University of California, Davis to research the reasons for fatalities and injuries among racehorses.

The recommendations include:

A joint proposal for a racetrack safety program by the J.D. Wheat Veterinary Orthopedic Research Laboratory and the California Animal Health and Food Safety Laboratory System in concert with the CHRB Postmortem Program.

A rule that would void a claim if a horse suffers a fatality during or immediately after the race or if the claimed horse is placed on the veterinarian’s list as unsound or lame.

A plan to increase inspections of smoke detectors in the stable area.

Transfer of veterinary medical records of horses undergoing postmortem examinations.

Access for new owners of a claiming horse to the past six months of veterinary data.

Changes in penalties for certain drug usage to enhance detection of masked injuries.

CHRB Outlines Safety Initiatives (Thoroughbred Times)

Drugs

The deaths of Barbaro in 2006 and Eight Belles two years later have focused attention on the issue of drugs in the sport. As with human athletes, steroids are considered performance enhancers and have been found in horses tested after races. “Horses are running on drug-induced abilities as opposed to natural abilities,” owner Arthur Hancock says. “And when you breed those, you're going to be breeding more unsoundness” although, he acknowledged, the drugs do have therapeutic value when used judiciously.

The board has instituted procedures to measure carbon dioxide levels. They are designed to uncover an illegal practice known commonly as milkshaking, feeding a baking-soda solution to a horse in the hope of helping it run faster. But some critics contend that the board’s testing methods are inadequate and one trainer has gone to court to contest the procedure. A noted trainer has alleged in a lawsuit that the board’s methods do not square with the latest available scientific research.

Five Ways to Improve the Industry (BloodHorse)

Horse Racing Begins Reform, but Legal Drugs Are Still an Issue (by William C. Rhoden, New York Times)

Breeding, Betting and Dirt at Issue in Horse Racing Reform (by Jennie Rees and Gregory A. Hall, Louisville Courier-Journal)

Doug O'Neill Sues California Horse Racing Board over Carbon Dioxide Testing Methods (by Matt Hegerty, Daily Racing Form)

Track Deaths

The death counts at California horse racing tracks for two consecutive fiscal years between 2004-2006 were 320 and 317, respectively; a 32% increase over the average from the previous eight years. Horse racing was already taking a beating from the spread of legalized casino gambling, and the specter of horses writhing in agony at televised events attended by tens of thousands threatened the sport’s very existence. On the other side of the country, Kentucky Derby winner Barbaro collapsed at the Preakness Stakes in 2006 with injuries that ultimately led to its euthanasia the following year.

Although a number of factors contribute to horse breakdowns, some critics have zeroed in on the track surface and a debate rages over whether traditional dirt or synthetic surfaces are safest.

Dr. Rick Arthur, California Horse Racing Board equine medical director, expressed the industry’s growing consternation. “It's a serious multifactorial problem. It's very frustrating trying to figure out a way to address this issue because I don't think any of us think it's simple. It's been a little bit bewildering.”

While the state racing board grappled with a complex issue that involved breeding, medication and training, it decided to move forward on one aspect of the problem it thought might bear fruit immediately: the track surface. In May 2006, the board decided to get rid of dirt tracks and change to synthetics by the end of 2007. It issued an edict to racetrack owners throughout the state to comply or risk losing racing dates in 2008. California was the first state to mandate that its major thoroughbred tracks make the conversion. The cost for each new racing surface was estimated at between $6 million and $9 million.

Critics of the change were outraged. They complained about a dearth of studies of the new surface product or the causes of death, huge expenses, high-handed behavior by the board and the shedding of tradition. But Santa Anita Park, Golden Gate Fields, Hollywood Park, and Del Mar all replaced their dirt tracks with a synthetic, engineered surface. In the end, it was estimated that racetracks spent $40 million making the conversion.

After the new tracks were installed, the death count held steady; 325 in 2007-08 and 320 the next year. Drainage problems plagued the synthetic tracks and new kinds of injuries seemed prevalent. A report by the racing board identified more hind-leg injuries, instead of the front-leg injuries that typically result in more deaths. The report showed 19 of 111 horses that died on California synthetic tracks in 2008 suffered hind-leg injuries, while only one out of 65 horses that succumbed on dirt tracks suffered a hind-leg injury.”

In January 2009, the board launched a pilot project to study synthetic tracks. In April, it began to backtrack on its policy and indicated a willingness to consider requests, on a case-by-case basis, to grant waivers from its synthetic turf rule. It practically invited the four big tracks that converted to make the application.

Horse deaths were down slightly to 287 in 2009-2010.

In November 2010, the board unanimously voted to give Santa Anita Race Track a waiver from its policy and allow it to convert back to a dirt track, which it promptly did. But the debate or which track surface to use continues, and was amped up considerably when the death of three horses during production of the HBO television series “Luck” led to its cancellation in 2012.

Ground Matters: God’s Dirt versus Man-Made Synthetic (by Jane Allin, Int’l Fund for Horses)

Mangled Horses, Maimed Jockeys (by Walt Bogdanich, Joe Drape, Dara L. Miles and Griffing Palmer, New York Times)

Horse Racing’s Black Eye (by Brian Hiro, North County Times)

Racing Board Meeting (Transcript) (pdf)

Traditional Dirt

Supporters of dirt tracks point to a long history and tradition of running on natural surfaces. The issue, they say, is complicated. There are numerous reasons why horses break down, including use of illegal drugs, inbreeding, poor pre-race checkups and badly maintained surfaces. Singling out track surface as a cause of death is bad science and merely delays grappling with the real causes of horse fatalities.

Although studies show that horses that race on synthetic surfaces have fewer fatal breakdowns, injuries that occur during training appear to be equal for synthetic surfaces and dirt.

The cost of switching is enormous. California spent $40 million converting its tracks to artificial surfaces, and then millions more converting at least one of them back to dirt. Racetracks are being compelled to spend large sums of money on technology that is not only in the developmental stage, but largely unproven.

“The decision to mandate synthetic surfaces in California, without a full study as to the effects it would have in the industry as a whole, was one of the worst, if not THE worst move, in the history of California racing,” horse racing writer Art Wilson opined in January 2010. “It's sort of sad for California that the most beautiful track in America (at Santa Anita) … the surface is just a disaster,” trainer Bob Baffert said. “It's just one of those things where we all thought it was going to work when they first came out with it, it was supposed to work, but it never did work like they said it would,” he said.

Gamblers say that artificial surfaces are harmful to the sport because they minimize the differences between horses and make wagering more difficult.

We’ll Soon Be Bidding Farewell to Pro-Ride (by Art Wilson, Pasadena Star-News)

Old as Dirt (by Claire Novak, ESPN)

Deaths Down Only Slightly Despite Reforms (by James M. Lewis, Modern Medicine)

Artifical Track

Recently conducted studies show marked injury differences between dirt and synthetics. A national study cited by the New York Times at 90 racetracks conducted over two years and released in 2010 found 1.55 deaths per 1,000 races on artificial surfaces compared to 2.14 on dirt.

Santa Anita Racetrack, one of the big four tracks in the state, received permission to revert to dirt in 2010 and saw its fatality rate jump from 1.5 deaths per thousand races to 3.7, while the other three big tracks hovered around 1.8.

A study by the Horse Racing Board of races at the big four California tracks between 2004-2009 found a 37% reduction in fatalities, from 3.09 per thousand to 1.95, when they switched to synthetics.

Supporters of artificial surfaces note that it is relatively new in the world of horse racing and the technology is still developing. It will only get better as the product and maintenance techniques improve.

CHRB Gives Nod to Artificial Tracks (by Jack Shinar, BloodHorse)

Horse Death Statistics Fuel Debate (by Brent Schrotenboer, San Diego Union-Tribune)

Santa Anita Leads California Tracks in Horse Racing Deaths (by Alan Zarembo, Los Angeles Times)

David Israel, 2013

Keith Brackpool, 2009-2013

John C. Harris, 2009

Richard B. Shapiro, 2006 – 2008

John C. Harris, 2004 – 2005

Roger Licht, 2003

Alan Landsburg, 2002

Robert H. Tourtelot, 2000 – 2001

George Nicholaw, 1999

Ralph M. Scurfield, 1992 – 1998