Hours Away From HISA’s Implementation, Unanswered Questions Remain

Turf Paradise

Months ago, I was talking to a horse racing industry source about the implementation of the Horseracing Integrity and Safety Authority. We were discussing concerns that there was still not a great picture of what the regulatory body would look like, even though it was required to launch by July 1.

“Well, it can’t be much worse than now, right?” I asked, in reference to the state-by-state patchwork regulation in horse racing that lacks uniformity, and in some instances, any sense.

There was a pause.

“Why can’t it?” the source said.

Now, that came from an admittedly biased source. But with the scheduled launch of HISA just hours away as of this article’s publication on Thursday, there are still lingering questions about its implementation.

And while there is a fair chance the federal agency will figure it out along the way, the gap between what should be happening and what will actually happen July 1 is pretty wide. There are also lawsuits seeking to block or delay HISA in the final hours before launch.

Concerns were expressed explicitly by a quartet of U.S. senators, in a letter to Lina Khan (the chair of the Federal Trade Commission, which oversees HISA) and Lisa Lazarus (CEO of HISA). The letter points out the “statutorily mandated” July 1 deadline and how certain aspects — most notably the drug testing program — won’t be in place by that date.

“The Authority publicly stated in a December 2021 press release that it will not implement the Anti-Doping and Medication Control program by the statutory deadline of July 1. … This deadline is statutorily required and neither the FTC nor the Authority have the authority to extend this deadline,” the letter signed by Sens. Chuck Grassley, Joe Manchin, Joni Ernst,  and John Kennedy said. “The Authority’s release also makes clear that the Authority has not submitted proposed Anti-Doping and Medication Control program regulations to the FTC in compliance with the statute. HISA required the Authority to issue the rule for Anti-Doping and Medication Control not later than 120 days before the program effective date of July 1. …  This deadline has passed, and it appears the Authority failed to meet the statutory requirements.”

Medication/drug testing

The aspect of uniform drug testing for horse racing in the United States is the crown jewel of the Horseracing Integrity and Safety Act of 2020, which created the HISA agency. From its own press releases, it is stated that “HISA was created to implement, for the first time, a national, uniform set of rules applicable to every thoroughbred racing participant and racetrack facility.”

If well-executed, a robust, uniform drug-testing program is what many industry forces have desired for some time, although whether it would “clean up the game” in actuality or just in perception remains debatable.

And the drug testing entity that HISA is set to use starting Jan. 1 — Drug Free Sport International — was not its first choice. The United States Anti-Doping Agency (USADA) announced in December that it was “unable to reach an agreement” with HISA.

“There are massive challenges to accomplishing this goal — not the least of which are large sections of the industry that are satisfied with the current state of affairs — but we wanted to be in the fight to clean up the sport,” a statement from USADA CEO Travis Tygart said. “Unfortunately, we were unable to reach an agreement that would allow us a reasonable chance to successfully deliver our existing gold-standard programs, including adequate testing, education, and investigative capacities.”

And HISA’s decision to delay its drug testing, despite its statutory mandate, has led horsemen’s groups to ask why other aspects of the agency can’t be delayed past July 1 if they are not ready.

“We [praise] Senator Chuck Grassley and his Senate colleagues for taking a leadership role in demanding answers to many of the same questions we have been asking for months without response,” said Eric Hamelback, CEO of the National Horsemen’s Benevolent and Protective Association (HBPA).

Unanswered questions

The issue of unanswered HISA questions — most often in the form of “what if?” or “and then what?” — are the most frustrating to those in the horse racing community, although Lazarus has put herself out there recently in meetings and Q&As with horsemen’s groups.

One of the most glaring issues on the ground is the availability of veterinarians for pre-race exams, which are mandated by HISA. It is a noble pursuit, and while many (including this writer) have argued that if basic requirements for safety and the care of horses can’t be met then racetracks shouldn’t be racing, the reality of the situation is that there are not enough vets to go around in every racing state.

If you can’t run a meet competently, you shouldn’t have a meet. https://t.co/72QNtdpTpl

— Jeremy Balan (@jeremybalan) February 2, 2022

This has been a major issue at racetracks like Turf Paradise in Phoenix, and other places where horses regularly go without a pre-race exam, and a recent report from Natalie Voss of Paulick Report said “while [New Mexico] state regulation allows regulatory veterinarians to screen all horses before races, only about 20 to 30 percent of runners in the state are actually seeing a veterinarian in the morning before they run.”

Large, nationally visible jurisdictions already have pre-race exams for all horses, but what happens if smaller racing states don’t have enough vets to cover all the horses, as required by HISA regulations?

“One of many things we really don’t know,” an industry source said.

Another “what if” relates to vets and other compliance issues. If jurisdictions or individual racetracks are unwilling or unable to comply with HISA safety standards, for any number of reasons, what does that mean?

During a meeting with the Kentucky HBPA, Lazarus responded to compliance and enforcement questions by saying, “We are doing our very best to communicate what we can, with everyone we can, given the timelines, but it’s what the government said. And I think the decisions we’ve taken, in terms of delaying enforcement in a number of areas, to try to get everyone educated, I think shows we recognize the challenges everyone is facing. …

“All I can really say is, this is what the federal government has imposed on us. The federal government could also close down horse racing, so we are doing everything we can to comply with the law, in a way that we think is the most sensible. Where we make mistakes, we’re going to revisit it. Where we’re creating really insurmountable obstacles, we’re going to look at it and try to find solutions.”

Texas pulls out

Part of the “teeth” HISA has involves the export and import of simulcast signals across state lines, for both advance-deposit wagering on thoroughbred races and off-track betting operations, and it has the authority to cut off those signals if jurisdictions are not compliant.

That has led Texas, not traditionally a fan of federal oversight in general, to essentially cut itself off from out-of-state simulcasting, but even the details of how that would work are unclear. If Texas does not export its racing signals, or potentially import out-of-state signals, it may be able to continue for some time, but industry sources have described the move as potentially “suicidal” and “not a long-term solution.”

There is also the question of state-by-state costs, and how HISA will fund its regulatory efforts going forward. Only a handful of racing jurisdictions, according to industry sources, have agreed to pay HISA costs through some sort of state or state commission funds. But if state commissions decline to fund their share of HISA costs, they will be passed on to individual racetracks.

It remains to be seen whether individual racetracks will be willing or able to pay those costs, and without those issues settled, HISA is launching anyway. And those costs are set to change when drug testing begins in 2023. So how does a regulatory body proceed without a stable, defined funding mechanism and undeclared costs?

“Again, we don’t really know,” an industry source said.

What’s ahead?

It’s hard to avoid the comparison of HISA’s rollout to the Affordable Care Act (or Obamacare, colloquially).

Regardless of your political persuasion, the launch of Obamacare was a disaster. People struggled to get registered (an ongoing issue with HISA, as well, which appears to be getting better), and it was clear the federal program was not prepared for launch.

That is the same sense those inside and outside of the horse racing industry have about HISA. But while plenty of people may still disagree with Obamacare ideologically, the program’s issues with operations have subsided, at least compared to the mess at the start.

It’s safe to say that it is not uncommon for new federal programs to struggle in the early days and work their way through them with time. But the true unknowns are what consequences might arise from all the uncertainty before HISA figures it out.

Photo: Tom Tingle/The Republic/USA TODAY

Author: Ryan Gonzales