Howard Hamilton - Horse Sense LAST WEEK we continued the look at the protection of the intellectual property rights and the problems which race tracks are having. We looked at the position being articulated by the local bookmakers as they sought to have an extended use of the Intellectual Property of Caymanas Track Limited. This week we explore how greater levels of cooperation can be structured so as to yield greater revenues to the horsemen.
The Bookmakers have been their own worst enemy. They are still perceived as rapacious and dishonest particularly in the level of sales which they report. A new group of younger bookmakers have sought to change that image and have in fact broken off from the 'moribund' Jamaica Bookmakers Association and formed their own association - The United Bookmakers Association. My understanding is that these 'young Turks' represent some 70 per cent of the total Bookmaking turnover. They have approached the bookmaking operation with an enlightened attitude. The majority of their shops are now computerised and information on sales is immediately 'networked" to the Betting Gaming & Lotteries Commission. Their sales have almost doubled since computerisation and there is greater control over their agents. It is this group that has been arguing for the removal of the restriction on opening hours. They feel a level of impotence when, having closed their shops, they see the illegal operators reaping millions which could quite easily be diverted through channels that provide additional revenue to all the racing participants - Government, Regulators, Promoters, Owners, Trainers, Jockeys, Grooms, Breeders, Vendors - the list is endless of those who benefit directly and indirectly from the Racing Industry.
The Ministry of Finance and Planning recently held a forum at which there was wide discussion on the subject of the Bookmaker's opening hours. Papers were presented by Caymanas Track Limited and the United Bookmakers Association.
The main thrust of the paper presented by Caymanas Track Limited was that ---- "The removal of the restriction would have a most disastrous effect on sales at the track and in the OTB's and would create a most uneven playing field in favour of the Bookmakers."
OLD PERCEPTION OF BOOKMAKERS
The paper reflects the old perception of Bookmakers and takes no account of the major paradigm shift that has taken place with those bookmakers represented by the United Bookmakers Association. They have computerised most of their shops and now operate with a high level of efficiency and transparency. I suggest to Caymanas Track Limited that they discuss with the Betting Gaming & Lotteries Commission the performance of those bookmakers who have "tested the water" and remained open all day in certain selected shops. Their sales would be a shocking eye opener. Compare their sales performance with their own operation for the same period.
Let the facts speak for themselves and let our decisions be so guided.
The United Bookmakers Association presented a paper which reflected their frustration with the amount of money being siphoned out of the system by illegal operators. To them the solution of more revenue to the racing interest was simple and urgent - give punters the opportunity of channelling their wagering through the licensed legal activity that is computerised and monitored by the BG&LC. They even made a further offer to sell exotic bets into the tote and so provide another revenue boost for the Promoter.
Nothing can move forward until the taxation issue is addressed. My recommendation is that those Bookmakers who have computerised their operation be moved to a net sales tax regime (similar to what has been done in the United Kingdom). My suggestion is that the level be set at 15% of net sales (gross sales minus payout). That all other Bookmakers are taxed at 15% of Gross Sales and they be given two years to computerise their operation to ensure efficiency and transparency.
My further recommendation is that the BG&LC amend the License of those shops which are computerized thus allowing them unrestricted opening hours. This amended license will be dependent on these Bookmakers coming to some satisfactory arrangement with Caymanas Track Limited for the extended use of their intellectual property.
I would suggest that Book-makers pass a fee of 5 per cent of total sales (instead of the current 0.5 5 per cent) to Caymanas Track Limited and that Caymanas Track Limited pay a fee of 55 per cent of the Gross Sales of all exotic bets and/or any other bets which are passed through the pool to the Bookmakers.
The rights fee of all other Bookmakers should be raised from 0.55 per cent to 2.55 per cent of Gross Sales.
Next week we will continue the look at the relationship between Caymanas Track Limited and the Bookmakers and also review the process of divestment.
Howard L. Hamilton, C.D., J.P., is a former Chairman of Caymanas Track Limited and is the current President of Thoroughbred Owners & Breeders Association. He can be contacted at howham@cwjamaica.com.
