2006 Annual Report Review

Illinois Racing Board Acting Chairman Joseph J. Sinopoli Glen Ellyn Dennis S. Bookshester Joseph N. Casciato Chicago Burr Ridge W. Jack Chamblin Angelo A. Ciambrone William H. Farley Jr. Robinson Chicago Heights Oak Park Timothy P. Martin Jonathan P. Metcalf Paul B. Smith Robert C. Winchester Homer Glen Indian Head Park Plainfi eld Rosiclare Marc V. Laino - Executive Director Shelley Kalita - General Counsel/Director of Administration Domenic DiCera - Director of Field Operations Mickey Ezzo - Projects Coordinator Robert Lang - Director of Mutuels Ed Mingey - Director of Security Adam Negrusz - Laboratory Director Patricia Rocco - Director of Licensing IRB-1 (R-6/07) Page 3 Page 4 IRB-1 (R-6/07) Table of Contents Review . 6 Laboratory . 8 Track and OTB Locations . 9 Money to Illinois Sources and Allocation of Revenue-Exhibit I . 10 Cash Disbursements-Exhibit II . 11 Statistical Data Purses, State Revenue, Track Commission, and Payout to Public 1989-2006 . 12 1987-2006 Illinois Handles . 13 2006 Disbursement of Illinois Handle . 14 2006 Monthly Handle Comparison . 15 Comparison of Handle on Track, Intertrack, and Off Track . 16 On Track Totals . 18 Intertrack Totals . 19 Off Track Totals . 20 All Racing Totals . 21 Comparison of Wagering Pools . 22 2006 Off Track Parlor and Intertrack Handles . 24 Summary of Parlor Surcharges and Revenues to City and County . 25 2006 Illinois Handle on Out-of-State Tracks . 26 2006 Commingled Handle vs. Simulcast Handle . 27 2000-2006 Average Daily Handles and Purses of Thoroughbred Meets . 28 2000-2006 Average Daily Handles and Purses of Harness Meets . 29 2006 Major Stake Races . 30 2006 and 2007 Racing Dates Schedule . 31 Race Meeting Statistics Thoroughbred Arlington Park - Arlington Park . 32 National Jockey Club and Hawthorne Race Course - Hawthorne Race Course . 33 Fairmount Park - Fairmount Park . 36 Harness Balmoral Racing Club -Balmoral Park . 37 Maywood Park Trotting and Associates Racing - Maywood Park . 38 Suburban Downs - Hawthorne Race Course . 41 State and county fairs - Springfi eld, DuQuoin, and Brown County . 42 Intertrack and Off Track Locations Intertrack Sites . 43 Off track Parlor Sites . 44 Harness Breeders Fund Purses and Awards Paid . 47 Thoroughbred and Quarterhorse Breeders Fund Purses and Awards Paid . 48 IRB-1 (R-6/07) Page 5 The Year 2006 in Review he Illinois Racing Board is a regulatory and appointments to the Illinois Racing Board. On June enforcement agency of State Government. 19, Commissioner Dr. Paul Smith was appointed T The Illinois General Assembly establishes to replace Ralph Gonzalez, a member since 1984 public policy in the area of horse racing regulation and Chairman from 1999 to 2001. Dr. Smith was that is carried out by the Board. The Board, which previously employed by the Board for 33 years and allocates race dates to various racing associations, retired in 2002. Commissioner Angelo “Sam” Ciam- is also responsible for licensing, rule making, and brone was appointed to the Board on August 29 re- supervising the conduct of race meets. Every placing John Simon, a 16 year veteran of the Board. individual that participates in Illinois racing is Mr. Ciambrone previously served on the Board required to be licensed. The licensing process from 1976 to 1980 and was the Mayor of Chicago includes fi ngerprinting as well as the conduct of Heights from 1995 to 2003. Finally, on September a background review for criminal histories. The 11, Governor Blagojevich appointed Commis- Board issued 10,186 licenses during 2006. A staff sioner Joseph Sinopoli. Mr. Sinopoli served as the of administrative, security, and veterinary profes- Board’s Deputy Director and Legal Counsel from sionals, in conjunction with Board approved racing 1986 through 1990. In 1991, he was appointed the offi cials, supervised the activities at fi ve racetracks Board’s Executive Director and resigned in 1998. conducting pari-mutuel racing in Illinois during 2006. Prominent Chicago trial lawyer and Chairman of The Board is a member of the Association of the Board, Lorna Propes, submitted her resignation Racing Commissioners International (RCI), the from the Board effective December 13, 2006. She industry’s oldest and most prominent regulatory served as a member of the IRB from 1989 through association. Executive Director Marc Laino is August, 2002 and Chairman from April 14, 2003 an active participant on RCI committees. The through December 12, 2006. During her tenure on information contained in the RCI database allows the Board, Ms. Propes dealt with such issues and the Board to monitor the backgrounds of licensees the 1995 Interstate Simulcasting Legislation, admin- and to exchange important regulatory and industry istrative hearings on the Horse Racing Act recap- information with other jurisdictions. ture provisions, the re-birth of Arlington Park, and The 646 race programs conducted during the closing of Sportsman’s Park. She also served 2006 resulted in a total handle of $952,119,485 on the Thoroughbred Breeders’ Advisory Board representing a decrease of 5% compared to 2005. and several RCI committees. At the Chairman’s Thoroughbred meets accounted for $631,272,800, direction, the Board conducted several days of a decrease of 4%, while standardbred meets hearings in July to examine the state of the Illinois accounted for $320,846,685, a decrease of 7%. horse racing industry. Twenty-two industry experts offered their perspective on racing from the local, Twenty-seven percent of the total handle, or national, and international level. Testimony primar- $259,022,153 was wagered on Illinois races at ily focused on the history and contribution of horse wagering facilities in Illinois in 2006. An additional racing to the economy of Illinois, reasons for the $844.8 million was wagered on Illinois races broad- drastic decline in industry revenues over the past cast to other states. This represents a 6% decrease thirty years, and potential solutions that would allow from the prior year. However, 2006 marks the sixth Illinois racing to compete effectively with both other time since full-card simulcasting began that other racing jurisdictions and the diverse gaming oppor- states wagered more on Illinois races than Illinois tunities presently available in Illinois. Afterwards, a wagered on races from other states. report was given to the Governor and leaders of the Pari-mutuel wagering in Illinois generated General Assembly. $10,347,144 in total state revenues, a decrease of 12% compared to 2005. Wagering at off-track Since 2005, the Racing Board has been electroni- betting parlors generated $10.2 million (2% of OTB cally transferring individual license record informa- handle) for city and county governments in 2006. tion to the Collections Division of the Illinois Depart- This represents a 2% decrease from the prior year. ment of Revenue (IDOR) for comparison to their During 2006, Governor Blagojevich made several outstanding individual income tax debt database. Page 6 IRB-1 (R-6/07) This process has allowed the IDOR to collect nearly over the prior year. $140,000. For the fi fth consecutive year, the Board awarded Illinois granted 29 off-track (OTB) licenses in 2006. racing dates to the Brown County Fair Associa- Each Illinois racetrack is entitled to receive up to tion in Mt. Sterling, Illinois, to conduct pari-mutuel six OTB licenses, except Fairmount Park, which is wagering on two days of harness racing during its entitled to seven licenses. A total of thirty-seven county fair. licenses are available. Two new OTB’s opened, two Several IRB rule changes were adopted during closed and two received site approval. Inter-Track 2006, the most noteworthy being an emergency Partners, on behalf of Balmoral Park, opened a new amendment to the Medication rule, Part 603, autho- OTB facility in Normal and on behalf of Maywood rizing the Board’s Equine Testing Laboratory to test Park, opened a new OTB facility in Niles. OTB for human EPO antibodies, commonly referred to facilities in Bloomington and Grayville permanently as blood doping. EPO is a prohibited substance for closed their doors. The applications for OTB fa- racing in many jurisdictions around the world. The cilities in Hodgkins (Arlington Park) and Lockport use of EPO in horses is a dangerous practice and (Quad City Downs) received site approval in 2006. has no application in racehorses because of its life- In June of 2006, the Illinois General Assembly threatening side effects. passed legislation creating a tax on riverboat gam- FORT PRADO was voted the Illinois Thoroughbred bling and directing the proceeds to the horseracing Horse of the Year. This fi ve-year-old gray son of El industry. House Bill 1918 created the Horse Racing Prado, owned by Team Block and bred by David Equity Trust Fund and placed an additional 3% tax Block, had 4 win in 7 starts in 2006 and earned on those riverboat casinos that gross more than $327,910. Trained by Chris Block, Fort Prado $200 million annually. The anticipated $36 million recorded wind in the $200,000 Fair Grounds Breed- per year is intended to assist Illinois’ racetracks and ers’ Cup Handicap (gr. III), the $125,000 Tamp Bay horsemen. The fund, administered by the Illinois Breeders’ Cup, the $193,000 Connally Breeders’ Gaming Board, will sunset in 2 years. While the Cup Turf Handicap (gr. III), and the $75,000 Black four largest riverboat casinos in Illinois immediately Tie Affair Handicap at Arlington Park. Fort Prado obtained an injunction in the Will County Circuit fi nished third in the Sea o’Erin Breeders Cup Mile at Court blocking establishment of the fund and chal- Arlington and fourth in the Grade III Robert F. Carey lenging the constitutionality of the law, the money is Memorial Handicap at Hawthorne Race Course being paid into a Protest Fund pending the out- and was also selected Illinois’ champion older hand- come of the lawsuit.

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