Virginia Clash Escalates

by T.D. Thornton 
The ongoing dispute between Colonial Downs and the Virginia Horsemen’s Benevolent and Protective Association escalated another notch on Wednesday when it was revealed at a Virginia Racing Commission meeting that Jacobs Entertainment, the owner of Colonial, has withheld $419,351 in simulcast revenue payments from the VHBPA over the last five months. 

According to a report in the Richmond Times-Dispatch, the disclosure of the disputed funds triggered a closed-session meeting that barred the general public and the press because the VRC believed the dispute involved “probable litigation.” 
Frank Petramalo Jr., executive director of the Virginia HBPA, told the TDN that the money in question represents 5% of the online gambling revenue collected by EZ Horseplay, a sister company of Colonial Downs, and that it was Colonial’s opinion that the VHBPA is not entitled to the simulcasting revenue because the horsemen’s group and the track are no longer contractually linked. 

“Colonial’s position, which I don’t think has any legal merit, is that since Colonial Downs turned in their license and there’s no racetrack, that means there’s no horsemen’s organization in Virginia,” said Petramalo, who is an attorney. “EZ Horseplay hasn’t paid. The other three national companies–TVG, Xpressbet and TwinSpires–have continued to pay us [source market fees from simulcasting] knowing full well what the situation is in Virginia.” 

This latest clash is part of an ongoing saga in Virginia that began in 2014 when Colonial and the VHBPA couldn’t come to terms over the length and scope of the summer race meet, resulting in the cancellation of the entire Thoroughbred season and Colonial’s eventual surrendering of its racing license last autumn. 

In the half year since, the track and horsemen have sparred over trying to rekindle negotiations for a 2015 meet. A bill has been working its way through the Virginia legislature that would redirect revenue from off-track wagering away from Colonial Downs and toward a non-profit horsemen’s organization that would be free to negotiate with other venues to use that money for purses. 

Two weeks ago, Virginia Governor Terry McAuliffe proposed a compromise amendment that would give a yet-to-be-recognized horsemen’s non-profit organization the right to take over the state’s OTB facilities if Colonial didn’t get its license back by Aug. 1. 

But negotiations broke down earlier this week when Colonial closed all its remaining pari-mutuel venues (primarily 75 EZ Horseplay kiosk outlets). The parent company specifically cited in a press release the governor’s compromise legislation as the reason for the EZ Horseplay shutdowns. 

A Jacobs Entertainment spokesperson wrote in an email that track officials would not be available to comment until Thursday. The Times-Dispatch quoted Stan Guidroz, however, regional vice president of Jacobs Entertainment, as saying “all negotiations with [the VHBPA] have ceased, and all of the lease discussions are done.”