In the fourth part our new series asking key questions about horse racing’s future, Daniel Ross speaks to longtime track official Corey Johnsen
The recent Breeders’ Cup boasted the third highest handle in the event’s history. Handle for this year’s Kentucky Derby reached record levels, while Saratoga’s summer meet concluded with notable all-source wagering increases over the year before.
Good news, right? Not so fast.
Handle figures are a far less accurate barometer of fiscal health than revenues – in other words, the slice of the wagering pie that goes back to the industry. Beyond a select few success stories, this particular slice continues to shrink, having knock-on impacts that reverberate throughout the sport. But where does all this lead?
Here our series continues with longtime track official Corey Johnsen.
As president of CJ Thoroughbreds, Corey Johnsen (left) has enjoyed a golden summer, thanks in no small part to the success of the team’s Hang The Moon. But it’s his bona fides at the helm of several tracks that the TRC is most interested in.
Johnsen was president of Lone Star Park when it hosted the Breeders’ Cup in 2004. With partners, he purchased a then-struggling Kentucky Downs in 2007 and transformed the venue into the purse-rich powerhouse it is today.
Most recently, Johnsen has thrown his weight behind the revitalization of the Maryland racing industry, with the state legislature having recently approved, among other things, the transfer of ownership of Pimlico Race Course from 1/ST Racing and Gaming to a quasi-state entity, and the establishment of a year-round training facility for Maryland's horsemen and women.
One thing about Corey Johnsen’s orbit is that the clouds wear silver linings.
He sees the sort of uniform program the Horseracing Integrity and Safety Act (HISA) provides as a major plus to racing’s social license to operate. “We’ve needed a nationally coordinated program to ensure the integrity and safety of our sport,” he said, pointing out how the majority of tracks recognize its benefits.
A lot of positive things
Johnsen also sees signs of economic health all over the country. “Maryland has really opened my eyes as to what is happening in racing,” he said. “We are human beings, and sometimes we only notice the negative things, while there’s a lot of positive things that are going on.
“When I look to the future of Thoroughbred racing, I’m very enthused,” he went on. “But I needed to be injected into the Maryland situation where I know by 2027, Maryland racing is going to be great again.”
What is it that gives him such confidence? “When you look at other professional sports, would they be as successful without all the new stadiums and arenas?”
Johnsen points to the $455 million NY-state injection into Belmont Park, plus Oaklawn Park, which has spent significant money to improve its gaming and racing facilities.
Then there’s New Jersey, which recently touted an extension to its $20m annual purse enhancement for horse racing in the state, the appropriation now running through to 2029.
“The tracks in Kentucky have spent a lot of money improving not just the racing situation, but improving the historical horseracing situation,” he added. “A significant amount of HHR [Historic Horse Racing] revenues go to purses and KBIF [Kentucky Thoroughbred Breeders’ Incentive Fund] awards. We’re seeing that improving the quality of racing.”
Useful blueprint
Maryland’s future could offer a useful blueprint for other jurisdictions to follow, said Johnsen, via an industry-led non-profit structure of racetrack ownership and management, similar in effect to the UK’s Jockey Club.
“I think we should look at the UK model and as an industry, step up and operate more of our tracks ourselves,” he said.
Unlike others interviewed for this series who have decried the precarious position of many smaller tracks, Johnsen points out that grim economic forecasts aren’t uniform.
“Racing was shut down in 2010 in Wyoming,” he said. “Last year, the state brought racing back, and now this year, they’re going to pay out approximately $15m-plus in purses and breeders’ awards. Now that historical horse racing has taken off in Wyoming, I think that number could be north of $20m in the next couple of years.”
What cannot be denied is that many of these infrastructure improvements are in states with purses supplemented with outside revenues.
Johnsen doesn’t share the same level of concern that others have about this dynamic, arguing that if horse racing can just prove to its legislators the economic benefits of horse racing, they should be on sound footings. “As a whole, I believe we have a great sport that is entertaining to horseplayers and even casual fans,” he said.
“We have a sport that means a tremendous amount to the agriculture and in many cases the tourism industries in these states. If we go out there and tell our story, then the legislature will see a return on investment to changing the business formula and the tracks and their horsemen group. It just takes time.”
Economic headwinds
However, certain states, notably California, are reliant solely on revenues generated through betting turnover, and face tremendous economic headwinds as a result.
Again, Johnsen’s take is one looking for the cherries on top. “I do know there’s a ton of money just from racing in California,” he suggested. “States go through stages off ebb and flow in their development. In 2010, If you were to look at racing in Kentucky objectively, you’d have said it was in huge trouble.
“But they’ve been able to go to the legislature, and they were able to convince them of the importance of the industry, and they were able to get a change in their business formula.”
To sell a compelling message to slate lawmakers takes skill, coordination and no small amount of slick politicking from industry heads. Certain jurisdictions have struggled in recent years from a vacuum of effective and smart leaders. “It’s not perfect everywhere,” Johnsen agreed.“You don’t always the perfect mix of people.”
That said, “one of the assets we have in Thoroughbred racing, we have a lot of really accomplished, smart people in all facets of our sport, meaning from track ownership, management, to horse owners,” said Johnsen, back on brand.
“I mean, some of the most brilliant businessmen in America own horses,” he added. “When they get involved, they can be extremely effective.”
Part 3: ‘What are the little guys supposed to do?’ – Tina Bond (trainers)
Part 2: ‘Greed is a bad word, but that’s kind of what it is’ – Craig Bernick (breeder)
Part 1: ‘Right now, there are way too many Grade 1 races’ – Marshall Gramm (owner)
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