[House Hearing, 110 Congress]
[From the U.S. Government Printing Office]


 
BREEDING, DRUGS, AND BREAKDOWNS: THE STATE OF THOROUGHBRED HORSERACING 
             AND THE WELFARE OF THE THOROUGHBRED RACEHORSE

=======================================================================

                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON COMMERCE, TRADE,
                        AND CONSUMER PROTECTION

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                        THURSDAY, JUNE 19, 2008

                               __________

                           Serial No. 110-129


      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov



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                    COMMITTEE ON ENERGY AND COMMERCE

                  JOHN D. DINGELL, Michigan, Chairman

HENRY A. WAXMAN, California          JOE BARTON, Texas
EDWARD J. MARKEY, Massachusetts          Ranking Member
RICK BOUCHER, Virginia               RALPH M. HALL, Texas
EDOLPHUS TOWNS, New York             J. DENNIS HASTERT, Illinois
FRANK PALLONE, . r., New Jersey      FRED UPTON, Michigan
BART GORDON, Tennessee               CLIFF STEARNS, Florida
BOBBY L. RUSH, Illinois              NATHAN DEAL, Georgia
ANNA G. ESHOO, California            ED WHITFIELD, Kentucky
BART STUPAK, Michigan                BARBARA CUBIN, Wyoming
ELIOT L. ENGEL, New York             JOHN SHIMKUS, Illinois
ALBERT R. WYNN, Maryland             HEATHER WILSON, New Mexico
GENE GREEN, Texas                    JOHN B. SHADEGG, Arizona
DIANA DeGETTE, Colorado              CHARLES W. ``CHIP'' PICKERING, 
    Vice Chairman                    Mississippi
LOIS CAPPS, California               VITO FOSSELLA, New York
MIKE DOYLE, Pennsylvania             STEVE BUYER, Indiana
JANE HARMAN, California              GEORGE RADANOVICH, California
TOM ALLEN, Maine                     JOSEPH R. PITTS, Pennsylvania
JAN SCHAKOWSKY, Illinois             MARY BONO MACK, California
HILDA L. SOLIS, California           GREG WALDEN, Oregon
CHARLES A. GONZALEZ, Texas           LEE TERRY, Nebraska
JAY INSLEE, Washington               MIKE FERGUSON, New Jersey
TAMMY BALDWIN, Wisconsin             MIKE ROGERS, Michigan
MIKE ROSS, Arkansas                  SUE WILKINS MYRICK, North Carolina
DARLENE HOOLEY, Oregon               JOHN SULLIVAN, Oklahoma
ANTHONY D. WEINER, New York          TIM MURPHY, Pennsylvania
JIM MATHESON, Utah                   MICHAEL C. BURGESS, Texas
G.K. BUTTERFIELD, North Carolina     MARSHA BLACKBURN, Tennessee
CHARLIE MELANCON, Louisiana
JOHN BARROW, Georgia
BARON P. HILL, Indiana

                                 ______

                           Professional Staff

                  Dennis B. Fitzgibbons, Chief of Staff

                   Gregg A. Rothschild, Chief Counsel

                       Sharon E. Davis, Chief Clerk

                David L. Cavicke, Minority Staff Director

                                  (ii)
        Subcommittee on Commerce, Trade, and Consumer Protection

                   BOBBY L. RUSH, Illinois, Chairman
JAN SCHAKOWSKY, Illinois             CLIFF STEARNS, Florida,
    Vice Chairman                         Ranking Member
G.K. BUTTERFIELD, North Carolina     J. DENNIS HASTERT, Illinois
JOHN BARROW, Georgia                 ED WHITFIELD, Kentucky
BARON P. HILL, Indiana               CHARLES W. ``CHIP'' PICKERING, 
EDWARD J. MARKEY, Massachusetts          Mississippi
RICK BOUCHER, Virginia               VITO FOSSELLA, New York
EDOLPHUS TOWNS, New York             GEORGE RADANOVICH, California
DIANA DeGETTE, Colorado              JOSEPH R. PITTS, Pennsylvania
CHARLES A. GONZALEZ, Texas           MARY BONO MACK, California
MIKE ROSS, Arkansas                  LEE TERRY, Nebraska
DARLENE HOOLEY, Oregon               SUE WILKINS MYRICK, North Carolina
ANTHONY D. WEINER, New York          MICHAEL C. BURGESS, Texas
JIM MATHESON, Utah                   MARSHA BLACKBURN, Tennessee
CHARLIE MELANCON, Louisiana          JOE BARTON, Texas (ex officio)
JOHN D. DINGELL, Michigan (ex 
    officio)
  


                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Bobby L. Rush, a Representative in Congress from the State 
  of Illinois, prepared statement \1\............................
Hon. Jan Schakowsky, a Representative in Congress from the State 
  of Illinois, opening statement.................................     1
Hon. Ed Whitfield, a Representative in Congress from the 
  Commonwealth of Kentucky, opening statement....................     3
Hon. Cliff Stearns, a Representative in Congress from the State 
  of Florida, opening statement..................................     5
Hon. Lee Terry, a Representative in Congress from the State of 
  Nebraska, opening statement....................................     6
Hon. Joseph R. Pitts, a Representative in Congress from the 
  Commonwealth of Pennsylvania, opening statement................     7

                               Witnesses

Alan Marzelli, President and Chief Operating Officer, The Jockey 
  Club, New York, New York.......................................     9
    Prepared statement...........................................    11
    Answers to submitted questions...............................   174
Richard Shapiro, Chairman, Caliornia Horseracing Board, 
  Calabasas, California..........................................    16
    Prepared statement...........................................    17
    Answers to submitted questions...............................   178
Jack Van Berg, Trainer, Inglewood, California....................    27
    Prepared statement...........................................    28
    Answers to submitted questions...............................   180
Randy Moss, Analyst, ESPN........................................    27
    Prepared statement...........................................    28
    Submitted questions \2\......................................
Arthur Hancock, President, Stone Farm, Paris, Kentucky...........    32
    Prepared statement...........................................    34
    Answers to submitted questions...............................   182
Jess Stonestreet Jackson, Stonestreet Farm, Geyserville, Georgia.    36
    Prepared statement...........................................    38
    Submitted questions \3\......................................
Lawrence R. Soma, V.M.D., Professor, School of Veterinary 
  Medicine, New Bolton Center, University of Pennsylvania........    64
    Prepared statement...........................................    67
    Answers to submitted questions...............................   183
Susan M. Stover, D.V.M., Ph.D., Dipl. ACVS, University of 
  California-Davis...............................................    81
    Prepared statement...........................................    83
Wayne McIlwraith, Ph.D., D.V.M., F.R.C.V.S., Gail Holmes Equine 
  Orthopaedic Research Center, Colorado State University.........    93
    Prepared statement...........................................    95
    Answers to submitted questions...............................   195
Mary C. Scollay, D.V.M., Equine Medical Director, Kentucky Horse 
  Racing Authority...............................................   114
    Prepared statement...........................................   116
    Answers to submitted questions...............................   195
Allie Conrad, Executive Director, CANTER Mid-Atlantic, 
  Gaithersburg, Maryland.........................................   125
    Prepared statement...........................................   127
    Answers to submitted questions...............................   198
Alexander M. Waldrop, Chief Executive Officer, National 
  Thoroughbred Racing Association................................   168
    Prepared statement...........................................   169
    Submitted questions \4\......................................

----------
\1\ Mr. Rush did not submit a prepared statement.
\2\ Mr. Moss did not answer submitted questions for the record.
\3\ Mr. Jackson did not answer submitted questions for the 
  record.
\4\ Mr. Waldrop did not answer submitted questions for the 
  record.


BREEDING, DRUGS, AND BREAKDOWNS: THE STATE OF THOROUGHBRED HORSERACING 
             AND THE WELFARE OF THE THOROUGHBRED RACEHORSE

                              ----------                              


                        THURSDAY, JUNE 19, 2008

            House of Representatives,      
           Subcommittee on Commerce, Trade,
                           and Consumer Protection,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:05 a.m., in 
room 2322, Rayburn House Office Building, Hon. Jan Schakowsky 
presiding.
    Present: Representatives Schakowsky, Barrow, Hill, 
Whitfield, Stearns, Pitts, Terry, and Burgess.
    Staff Present: Christian Fjeld, Consuela Washington, 
Valerie Baron, James Robertson, Brian McCullough, Shannon 
Weinberg, Will Carty, and Chad Grant.
    Ms. Schakowsky. The Subcommittee of the Commerce, Trade and 
Consumer Protection Subcommittee will begin and come to order.
    I want to begin my opening statement once again 
acknowledging our subcommittee Chairman, my friend and 
colleague Bobby Rush, who continues to recuperate in Chicago. 
We all look forward to his swift return to Washington. At this 
time I would like to ask unanimous consent to insert Chairman 
Rush's statement into the record. Without objection, so 
ordered.
    [The prepared statement of Chairman Rush was unavailable at 
the time of printing.]

 OPENING STATEMENT OF HON. JAN SCHAKOWSKY, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF ILLINOIS

    Ms. Schakowsky. I will now recognize myself for 5 minutes 
for the purpose of an opening statement.
    The death of Eight Belles on the track of the Kentucky 
Derby 2 months ago was a symptom of a host of problems that 
plague thoroughbred racing. The best racehorses in the sport 
are bred for speed because they make their money in the 
breeding shed instead of on the racetrack. Catastrophic 
breakdowns of thoroughbred horses are becoming more common as 
they become increasingly fragile over the years. Horses are 
doped up on performance-enhancing drugs such as cocaine, 
caffeine, and anabolic steroids to make them as fast as 
possible.
    Whether horses are sturdy enough to withstand the rigors of 
racing, it is really an afterthought, and almost no one pays 
attention to what their lives are like after they retire. As 
the horses falter, more and more jockeys face serious injuries 
and paralysis, and with no central regulatory body overseeing 
the sport, there are almost no real restrictions on any of 
these practices.
    It seems that greed has trumped the health of horses, the 
safety of the jockey, and the integrity of the sport. Although 
breakdowns have always been a part of this sport, long-term 
racing commentators and horsemen assert that the thoroughbred 
horse as a breed is becoming weaker. This may be because 
commercial breeding focuses on creating faster horses at an 
earlier age with little regard to the consequences of their 
practices.
    Take a look at the pedigree of the late Eight Belles, for 
example. Many observers say--is the chart up? It is not on the 
monitor. OK. Many observers say that Eight Belles was a genetic 
disaster waiting to happen. If you look at the chart, you can 
see her bloodlines were too inbred. Her great-great-grandfather 
four generations back on her father's side, Mr. Prospector, was 
also her great-grandfather on her mother's side three 
generations back. This is known as a three-by-four inbred. And 
Mr. Prospector, his father, Raise a Native, and his father, 
Native Dancer, all had something in common. Mr. Prospector was 
a brilliant racehorse, but he was also very unsound. He was 
retired due to chronic ankle injuries; raced only four times 
and won all four races, but then broke down. Native Dancer, 
another fast racehorse that was retired due to chronic 
inflammation in his ankles. Eight Belles came from a brilliant 
but fragile bloodline. All of those sires had problems in their 
ankles. And if this weren't enough to raise alarm, her father, 
Unbridled Song, highlighted up on this board, was another fast 
racehorse who showed brilliance later on, but who was 
permanently retired because of, yes, a fracture in his front 
ankle.
    To professional breeders her pedigree should have raised 
alarms, but they proceeded anyway, and many would argue that 
millions of people saw the horrible consequence of their choice 
live on national television.
    Also disturbing is how these animals are abused while they 
are in their prime. Horses are commonly injected with so many 
performance-enhancing drugs and other medications that it has 
become almost impossible to tell what their natural condition 
is. Many racehorses are regularly injected with painkillers 
which allow them to run injured by masking the pain in his or 
her legs and joints. According to data submitted to the 
committee by the Racing Commissioners International, there were 
nearly 1,900 drug violations in horseracing in the last 5 
years. But whether or not this data is accurate is questionable 
given the absence of reporting requirements throughout the 
industry.
    What is going on here? What is happening to the Sport of 
Kings? Unlike every other professional and amateur sport, 
horseracing lacks a central regulatory authority or league that 
can promulgate uniform rules and regulations. While baseball 
and football now impose strict rules that severely penalize 
players for steroid and performance-enhancing drugs, 
horseracing remains a confusing patchwork of different 
regulations from State to State.
    One of the central questions that the subcommittee wants to 
explore is, does horseracing need a central governing 
authority? Is the racing industry truly capable of making 
reforms on its own under the current regulatory framework?
    There are those who believe that Congress should not be 
involved in horseracing; however, Congress is already involved. 
The Interstate Horseracing Act, which is under this 
subcommittee's jurisdiction, allows racetracks a unique status 
under Federal law. Unlike any other gambling operation in 
America, they are allowed to transmit their racing product 
across State lines and receive wagers from bettors out of 
State.
    It is because Congress allows horseracing this benefit that 
90 percent of the $15.4 billion wagered on horseracing is from 
simulcast betting. As such, I ask all witnesses and all of the 
industry stakeholders to work with us, work with us to clean up 
your sport, work with us to save thoroughbred racehorses from 
destruction on the track. I say that, by the way, as a former 
owner of a thoroughbred who did perform on the track. Work with 
us to protect jockeys that ride them, work with us to create 
uniform tough standards that apply to every State, work with us 
to restore horseracing back to its perch as one of the 
America's most popular spectacles so that it can truly live up 
to its nickname as the Sport of Kings.
    I want to welcome all of our witnesses. I know they are the 
stars of the industry and commentators on the industry, and 
look forward to hearing each of your testimony.
    Ms. Schakowsky. I will now recognize the Ranking Member Mr. 
Whitfield for 5 minutes to make an opening statement.

  OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN 
           CONGRESS FROM THE COMMONWEALTH OF KENTUCKY

    Mr. Whitfield. Chairwoman Schakowsky, thank you very much 
for holding this important hearing. And I, like you, would 
certainly want to welcome our witnesses today on both panels, 
all of whom, I believe, have the best interest of this industry 
at heart. And we look forward to your testimony and what you 
have to say and what suggestions you might make to us about 
this important industry.
    This industry is vitally important to our country, not only 
economically, over a $40 billion-a-year effect on our economy. 
Many people obtain a lot of recreation by attending races 
around the country. And then we know racing is an important and 
cherished part of this Nation's history. But I do believe that 
horseracing is at a crossroads today, and I would like to 
reiterate what the Chairwoman said, that--and I agree with 
her--greed has trumped the health of the horse, the safety of 
the jockey, the strength of the breed, and the integrity of the 
sport.
    Now, why do I say that? I think there are three primary 
problems in this industry today. First of all, our horses race 
on drug-induced ability more than natural ability, and 
therefore, when we select winners for breeding, we are not 
necessarily selecting the best horse from a soundness 
standpoint. I read an article recently, and the author said 
that the question used to be who had the best horse, but many 
people today say, who has the best veterinarian? I don't think 
that that is good for this industry in the long term, and it 
certainly has had an impact in many different ways.
    A second problem area, in my view, is a lack of 
transparency regarding deaths on the track, regarding injuries 
on the track, and the ramifications that has for safety issues, 
particularly for the jockeys. I remember a couple of years ago 
we had a hearing, and Gary Birzer, a jockey, was injured up at 
either Charlestown or Mountaineer. He is a quadriplegic today. 
He had no insurance because the Jockey's Guild let him down, 
and his rehabilitation and his family--basically his medical 
needs are being met by Medicaid, a taxpayer program.
    And then I might also say that I read an AP article that 
said over the last 5 years there have been 5,000 deaths on the 
track, but that did not include all of the States, it only 
included 29. It did not include all of the tracks in Florida, 
only one. Then I read another article that said there had been 
3,035 deaths over 5 years.
    The fact is we don't really know the answer to that because 
there is not a uniform tracking system in this industry. We 
know how many starts there are, but we asked the Jockey Club 
how many horses finished, how many horses were euthanized, how 
many horses were scratched, and they didn't know the answer to 
that. And we know that a horse named Runaway Sue up in 
Charlestown about 4 weeks ago was killed in the starting gate, 
but the official designation of what happened to that horse was 
that she was scratched. So I do agree with Dr. Rick Arthur, the 
California medical director, when he said nobody knows truly 
how big a problem this because the data is simply not there.
    A third issue in this industry is the lack of a central 
authority or an entity that has the regulatory power and 
authority to make decisions and to enforce rules and 
regulations. As has already been stated, there are 38 different 
racing jurisdictions, and there is not any one entity that can 
enforce those regulations. So that is a real problem.
    Now, I know people that have been critical and they said 
the Federal Government has no part in this industry, but we 
know that the industry came to Congress back in 1977-1978 and 
asked that Congress pass the Interstate Horseracing Act to 
allow simulcasting that today provides 90 percent of the 
revenue of the $15 billion that is wagered each year. And then 
they came back in 2006 and asked Congress to amend it to 
address some concerns with the Wire Act because of the problems 
with the Department of Justice. And yet when Congress looks at 
the Horseracing Act as a vehicle to improve the sport, they all 
run away and say, no, the Federal Government does not need to 
be involved. But I would submit that if the Federal Government 
provides the revenue, the vehicle for the revenue, 
simulcasting, we have a responsibility to set minimum standards 
to ensure the safety of those participants, to ensure the 
integrity of the breed and the sport, and to ensure that we 
have a uniform medical rule around the country.
    So I look forward to the testimony of the witnesses today. 
And thank you again, Chairwoman Schakowsky, for holding this 
hearing. And I do also want to thank Chairman Rush, who had the 
hearings on the anabolic steroids and their impact on all the 
sports, including horseracing, and obviously without his 
support and your support, we would not have a hearing today. So 
we are thinking about Chairman Rush today as well. Thank you.
    Ms. Schakowsky. Thank you, Mr. Whitfield.
    And now Mr. Stearns.

 OPENING STATEMENT OF HON. CLIFF STEARNS, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF FLORIDA

    Mr. Stearns. Good morning, Madam Chairwoman, and I thank 
you for this hearing. And I thank the Ranking Member Mr. 
Whitfield for his very illustrative opening statement, which I 
think is echoed by many of us in this room.
    I say to the witnesses and to the people who are listening, 
this hearing is a wake-up call for you. There is abuse in your 
industry. You know it better than I. When I chaired this 
subcommittee during Republican control, we had hearings on 
steroids in baseball, football, basketball, professional 
wrestling, hockey, and what we said to the witnesses was we 
don't want to come in and regulate you, we want you to regulate 
yourself. So this is a wake-up call.
    As Mr. Whitfield said, we have jurisdiction here. You come 
to us and ask us for regulation. And then a lot of you come to 
us and say, oh, don't bother regulating us, but you wanted us 
to pass legislation in 1978 and 2006. And then you come back 
here and say, well, we don't have any jurisdiction. And that is 
oftentimes what we hear from our constituents.
    But I am saying there is a wake-up call here for you. We 
are talking about an industry with over 7 million Americans 
involved in the horse industry. It generates $112 billion in 
economic activity and supports 1.4 million full-time jobs. You 
have a fiduciary responsibility to make this industry 
transparent.
    In my hometown of Ocala, we have--between Levy and Citrus 
County, we have over 1,000 horse farms. And all these people 
are trying to do the right thing, but they are going to need 
leadership from the people in this room.
    I cochair the Congressional Horse Caucus, so I am deeply 
concerned about this industry, and I just want to know, was 
this a freak accident with Eight Belles, and was this 
demonstration something that we are going to see continually, 
or are you folks going to step up to the plate and do 
something? I don't necessarily want you to work with us. Work 
without us and prepare this Sport of Kings so that everything 
is in order and that there are rules and regulations that are 
promulgated from the top so that we don't need to develop a 
central regulatory authority from Congress. We are asking you 
to step up to the plate.
    Over the past 5 years, 3,035 thoroughbred horses have died 
in horseracing tracks across this country. Are you going to 
tell me this is normal, is this OK? Are these deaths the result 
of unsafe commercial breeding practices, of unsafe track 
surfaces, or of trainers administering certain drugs to improve 
the horse's performance?
    Now, obviously in the hearings I had in baseball, football, 
and basketball we made the case. We asked them to come up with 
a drug program, and they did. And so I think that was very 
effectual for our subcommittee on our hearings. There are 
trainers in this industry who give their horses cocaine, an 
illegal drug, to enhance their performance, and all they 
receive for this is a slap on the wrist or a small fine. 
Likewise, there are trainers who administer pain medication to 
mask a horse's injury so that they still can run a race even if 
this is detrimental to the long-term physical well-being of the 
horse.
    Today's horses appear to be much more fragile than the 
great racehorses of the past. Now, is this something that would 
require us to step in, or can you set up some type of 
regulatory authority for horseracing so that this can be 
transparent and prevent these horses from almost committing 
suicide?
    We have a place in this discussion as Members of Congress. 
As Mr. Whitfield pointed out, we passed the Interstate 
Horseracing Act, which allows racetracks to accept bets from 
across State lines. The interstate track betting significantly 
contributes to the $40 billion thoroughbred horseracing 
industry. So I hope the people in this room, and a lot of 
people in the horse industry who are making a fortune, should 
have a moral responsibility to step up here and try to answer 
these questions and put in place some kind of regulatory 
authority so that this does not continue.
    I look forward to the testimonies today, Madam Chairman, 
and I thank you for this hearing.
    Ms. Schakowsky. Thank you, Mr. Stearns.
    Next in order of appearance, Mr. Terry.

   OPENING STATEMENT OF HON. LEE TERRY, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF NEBRASKA

    Mr. Terry. Thank you, Madam Chairwoman. I appreciate the 
opportunity, and I welcome our witnesses. I especially enjoy 
having Jack Van Berg here, as I worked at Ak-Sar-Ben Racetrack 
for 4 years; put myself through 2 years of college and 2 years 
of law school there in its good days. And your horses were 
always stable there, pun intended. And a good friend of mine, 
Bob Kruger, whose grandsons are my interns here, you trained 
their grandfather's horses right now. So they are really 
enjoying working this issue.
    This is eerily similar to some hearings we held almost 2 
years ago with boxing, and how boxing had failed to regulate 
itself, perhaps even taking itself down to the level of 
wrestling, and the McCain bill to try and create a Federal 
commission within the Department of Commerce to regulate 
boxing. And there is, of course, as the opening statements have 
pointed out, some high jinks within horseracing that I think 
belittle the majesty of the sport.
    It is a great sport. I will tell you there is nothing 
better than being along the rail as the horses come around the 
turn, and the sound of it is just thrilling. But to think that 
the bloodlines have been prostituted in a way that maybe makes 
the horse lines more fragile, and risking injury and death is a 
legitimate issue that the industry needs to look at.
    Of course, the doping issue. We have been criticized for 
looking into baseball doping, so I don't know where we are 
going to be on ESPN tonight on criticizing horse doping, but it 
is an issue. And I think it is something that the horseracing 
industry needs to look at so fans like me, when a horse comes 
around the turn, we know is in a legitimate competition and not 
leading the pack because of what drugs had been administered to 
it before the race.
    So I am looking forward to your testimony with some 
nostalgia from my days at Ak-Sar-Ben Racetrack and Jack Van 
Berg's days there as well. And thank you for holding this 
hearing, and I yield back.
    Ms. Schakowsky. Thank you.
    And now Mr. Pitts.

OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN 
         CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

    Mr. Pitts. Thank you, Madam Chair. Thank you for holding 
this important hearing on Breeding, and Drugs and Breakdowns: 
The State of Thoroughbred Horseracing and the Welfare of the 
Thoroughbred Racehorse. I also extend my thanks to Mr. 
Whitfield for his leadership on this issue and in bringing this 
hearing to fruition.
    Along with my colleagues I remain deeply concerned about 
the use of drugs in horseracing. It is vital that the industry 
and its leadership come up with immediate long-term solutions 
to this problem, or those in the industry with major concerns 
will turn elsewhere for permanent change and correction.
    There are a number of major concerns in this industry, 
including the health and safety of horses, the health and 
safety of jockeys, and the fact that this is the only industry 
that is allowed by Congress to conduct interstate gambling to 
the tune of approximately $15 billion. That is a tremendous 
amount of money involved in an industry with little or no 
accountability.
    The National Football League suspends highly talented 
players from games or even entire seasons for their abuse of 
animals, like dogfighting or even for conduct that reflects 
poorly on their sport. In horseracing, however, reports suggest 
that individuals can get away with injecting horses with 
illegal and legal drugs that harm the animals and simply get a 
$2,000 fine or less. This is problematic. Why should people who 
abuse horses be allowed to get away with it? They shouldn't.
    As was discussed during the February hearing that this 
subcommittee held on steroids and drug use in sports in 
general, it is the integrity and honor of competition that is 
at stake. The integrity of horseracing is at stake. It is time 
for the industry as a whole to take a stand and end the abuse 
of horses, whether that be through drugs or through 
questionable breeding practices, which endangers both the 
horses and the humans who ride them. Watching a horse like 
Eight Belles who was cared for very well run a fantastic race 
and then be euthanized during her cool-down because of 
fractures in her ankles is deeply disturbing.
    I look forward to hearing from all of our guests today. I 
would like to extend a particular welcome to Dr. Lawrence Soma 
from the New Bolton Center, which is in my legislative 
district, congressional district. Your work on these issues is 
greatly appreciated. I am delighted that you are here today to 
provide us with testimony and insight on how we can best find 
solutions to the existing problems in this industry.
    In addition, I would like to extend my appreciation to 
Randy Moss for his leadership on this issue.
    Thank you to each of our distinguished witnesses for being 
here today, for providing us with your insight and 
recommendations on how to address these important concerns, and 
I look forward to your testimony and yield back.
    Ms. Schakowsky. Thank you.
    I would like to introduce all of the witnesses and then 
call on each in turn for a 5-minute presentation.
    I want to also associate myself with Mr. Pitts' gratitude 
to Mr. Whitfield for his leadership on this issue, and explain 
that this hearing is completely bipartisan in terms of the 
positions being taken by the Democrats and the Republicans on 
this committee.
    So I want to welcome you. And the first panel includes Alan 
Marzelli, president and COO of the Jockey Club. The Jockey Club 
is the breed registrar of all thoroughbreds in North America. 
In this role the organization promulgates regulations and 
standards on how a thoroughbred qualifies to be registered.
    Richard Shapiro is the chairman of the California 
Horseracing Board. California is the largest racing 
jurisdiction in the United States, and Mr. Shapiro chairs the 
body that regulates horseracing in that State.
    Jack Van Berg, as you heard, is a trainer. Mr. Van Berg was 
inducted into the Racing Hall of Fame in 1985 and is best known 
for training the late great Alysheba, who retired as the 
richest horse in the world in 1988.
    Randy Moss, analyst, ABC and ESPN, is one of the leading 
pundits on horseracing in America and currently works for ABC 
Sports and ESPN. He has been covering horseracing for 30 years.
    Arthur Hancock, III, is the owner-breeder at Stone Farm. 
Mr. Hancock is a fourth-generation horseman, and is perhaps 
most famous for owning and breeding 1989 Horse of the Year 
Sunday Silence.
    Jess Jackson is the owner-breeder at Stonestreet Stables. 
Mr. Jackson of Kendall Jackson wine fame owns Curlin, who won 
Horse of the Year honors for 2007. Mr. Jackson surprised the 
racing world when he brought back Curlin to the track for his 
4-year-old season.
    There is a name plate up there, but someone is missing.
    And we had expected Richard Dutrow. And I just would like 
to note the empty space for him, the trainer for Kentucky Derby 
and Preakness Stakes winner Big Brown. Apparently Mr. Dutrow 
was too ill to travel to Washington, D.C., and will not testify 
with our other witnesses today. Unfortunately Mr. Dutrow never 
informed this committee of his illness, and despite numerous 
attempts to reach Mr. Dutrow, he never notified anyone on 
committee staff that he would not be attending this morning's 
hearing. I am disappointed by his absence, and I am 
disappointed that he did not feel the need to notify the 
subcommittee directly of his decision. Given Mr. Dutrow's 
stature and reputation in the sport, I think it would have been 
a valuable addition to this public dialogue. I hope in the 
future when Mr. Dutrow recovers from his illness, he will join 
us and be part of the solution to clean up the sport of 
horseracing.
    I would like to remind all witnesses----
    Mr. Stearns. Madam Chairman, a point of information?
    Is it possible that we could submit questions to Mr. Dutrow 
in his absence? Perhaps we could send questions that we have 
and ask for his reply in anticipation of him coming back at a 
later date.
    Ms. Schakowsky. Well, as Mr. Whitfield just pointed out, we 
may have another hearing, but I think that submitting questions 
in writing and could become part of the official record. Well, 
we will discuss afterwards how that would become part of the 
official record.
    Mr. Stearns. Speaking in light of the fact that he said he 
would be here, meaning that he would comply, and the fact that 
he hasn't shown up, I assume that he would be interested in 
answering questions. So I would request that the committee put 
together a letter with our questions on both sides and submit 
them to him and see if he will reply.
    Ms. Schakowsky. OK. We will certainly take that under 
advisement. Thank you.
    I want to remind all witnesses that your written statements 
have been shared with committee members and submitted for the 
record. And as I mentioned before, I would like to remind the 
witnesses if they have opening statements to please take up to 
no more than 5 minutes for their statements.
    And we will begin with my left, your right, with our first 
witness, Mr. Marzelli.

   STATEMENT OF ALAN MARZELLI, PRESIDENT AND CHIEF OPERATING 
          OFFICER, THE JOCKEY CLUB, NEW YORK, NEW YORK

    Mr. Marzelli. Good morning, Chairman Schakowsky and members 
of the Committee. I am grateful for the opportunity to be here 
today and to briefly share with you some information about the 
Jockey Club.
    At the outset I want to state that the Jockey Club shares 
the concerns expressed by the members of this committee and is 
committed to being an agent for change throughout this process. 
The Jockey Club was formed in 1894, and it is the breed 
registry for all thoroughbred horses in North America. We are 
also a founding member of the International Studbook Committee, 
which serves to coordinate the policies and practices of 
studbook authorities around the world.
    A key ingredient to accomplishing this is through the 
development of the internationally accepted definition of a 
thoroughbred as contained in Article 12 of the International 
Agreement on Breeding, Racing, and Wagering. There are 
presently 64 countries that are signatories to this important 
article. As signatories, each studbook authority, including the 
Jockey Club, incorporates the provisions of Article 12 into its 
own rules.
    Neither Article 12 nor our own rules themselves promote 
specific attributes. To do so would be at best subjective and 
potentially restrictive to fair trade and free-market 
enterprise not only here, but around the world.
    I would also state that Article 12 of the international 
agreement is perhaps the best example of the global racing 
community harmonizing the rules of different jurisdictions in 
order to facilitate cross-border commerce. Curlin was mentioned 
earlier. The rules that are in place around the world through 
the International Studbook Committee are what permit a horse 
like Curlin to travel internationally and be recognized as a 
thoroughbred everywhere he goes.
    Now, beyond our primary mission as keeper of the American 
studbook, the Jockey Club has since our inception maintained a 
leadership role in numerous and wide-ranging industry 
initiatives. Time and time again the Jockey Club has devoted 
very substantial efforts and resources to projects that we 
believed in. The spring of 2008 was one of those times. The 
tragic breakdown of Eight Belles at the conclusion of this 
year's Kentucky Derby prompted the Jockey Club to announce the 
creation of a Thoroughbred Safety Committee whose purpose is to 
review every facet of equine health, including breeding 
practices, medication, the rules of racing and track surfaces, 
and to recommend actions to be taken by the industry to improve 
the health and safety of thoroughbreds.
    We have been meeting regularly since early May and, as you 
may know, issued our first set of recommendations 2 days ago. 
This wide-ranging set of recommendations includes a ban on 
front toe grabs and other traction devices, reforms in the 
equipment and usage of a riding crop by jockeys, and, 
importantly, the adoption of the RMTC model rule to eliminate 
anabolic steroids in the training and racing of thoroughbreds. 
These recommendations have been endorsed and supported by a 
wide cross-section of over 15 leading industry organizations.
    We are confident that with this unified support, these 
initial recommendations will be implemented in a timely 
fashion. Specifically, we are confident that 2008 will be the 
last year in which anabolic steroids will be permitted in our 
sport during training and racing.
    In closing, I must emphasize that the Thoroughbred Safety 
Committee's work has just begun. Additional recommendations and 
findings will be provided at our annual roundtable conference 
in Saratoga Springs in mid-August, if not before. And the work 
of the committee will continue beyond then as a standing 
committee of the Jockey Club's board of stewards.
    Specifically, the stewards of the Jockey Club and the 
members of the Thoroughbred Safety Committee are of the belief 
that the elimination of anabolic steroids is only a start. In 
order to restore the trust and confidence in our support that 
our fans deserve, in order to protect our equine athletes, and 
in order to ensure the long-term health of the thoroughbred 
breed, we must eliminate all performance-enhancing drugs from 
the sport. We are committed to seeing this effort through, and 
as evidenced by the strong show of support for our initial set 
of recommendations, we are confident that many other 
organizations in the industry share our beliefs.
    Thank you for your attention, thank you again for your 
interest, and I will be glad to answer any questions you have.
    Ms. Schakowsky. Thank you.
    [The prepared statement of Mr. Marzelli follows:]

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    Ms. Schakowsky. Mr. Shapiro.

STATEMENT OF RICHARD SHAPIRO, CHAIRMAN, CALIFORNIA HORSERACING 
                  BOARD, CALABASAS, CALIFORNIA

    Mr. Shapiro. Madam Chairwoman and Members, for three 
generations my family has been involved in nearly every aspect 
of this sport. I have operated a racetrack, competed as a 
harness driver, and have owned and bred thoroughbreds for 
racing. Currently I am the chairman of the California 
Horseracing Board.
    I would first like to acknowledge the thousands of 
dedicated horsemen and horsewomen who keep this beautiful sport 
alive. Horseracing is a $26 billion-a-year industry, directly 
providing nearly 400,000 jobs and satisfying careers from the 
inner city to rural America. As one of the first and oldest 
forms of legalized gambling in the United States, horseracing 
occupies a special place in our history and our culture.
    Nevertheless, I have witnessed the changes and accept the 
challenges that all of us in this industry now address every 
day. How do we help our sport survive and maintain its 
integrity in this era of enormous competition from Indian 
casinos, card clubs, new lottery games, and the potential 
spread of legalized Internet gambling?
    We are in the midst of transforming our ivy-covered brick-
and-mortar racing venues into the flashy Web graphics of live 
sports telecasting and entertainment, entertainment that people 
bet on. We must carefully balance the need to attract newer and 
younger casual fans while satisfying our regular patrons who 
enjoy our game and keep these venues alive. And we must never 
lose our vision or neglect our responsibility to care for the 
horses that people come to see, the beautiful creatures that 
make it all possible and whose health and welfare must always 
be our prime concern.
    As the tragic death of Eight Belles after the Kentucky 
Derby reminded us, horses are fragile, and the game can be 
cruel. But more is in operation here, and the best minds of the 
industry are closely examining why it is the breed appears to 
be weakening. In 1948, Citation won 19 of 20 starts as a 3-year 
old, including the Triple Crown. That same year he beat older 
horses and won at every distance from 6 furlongs to 2 miles. 
This year the Kentucky Derby was won by a horse that had only 
raced three times and now may race only twice more, if at all.
    According to the Jockey Club, horses raced on average 6.3 
times in 2007, down from a peak in 1960 of 11.3 times, and this 
despite diagnostic and veterinary medicine that rivals the 
human care offered at the Nation's best hospitals and clinics. 
A long-time track vet once testified 20 years ago we had twice 
the horses and half the vets; now we have twice the vets and 
half the horses. Today it is not uncommon for some vets to 
examine their patients for free and charge only for the 
medications they prescribe, an inherent conflict of interest.
    Without a doubt, medication has changed our sport and 
presented us with profound challenges that threaten the game 
itself. For the sake of speed and for having the fastest horse 
on the first Saturday in May, fewer horses are bred for 
durability, longevity and stamina. We push 2-year-olds onto the 
track before many can handle the rigors of racing. The game has 
become more horse breeding than horseracing. To give you a 
personal example, my family bred and owned the first horse to 
earn $1 million in California. His name was Native Diver. He 
raced 81 times and won 34 stakes races, a record that still 
stands today 40 years later. Today the career of a stakes-
caliber horse is considered long if he runs 25 times before 
retirement.
    Over the past 40 years, we have traded the time-tested 
regimen of hay, oats, and water for a virtual pharmacopoeia-- 
Lasix, Butazolidin, Clenbuterol--that has created, as one 
commentator recently noted, the chemical horse. After banning 
it as a performance enhancer, racing later permitted the 
widespread use of Clenbuterol, a drug originally marketed to 
fatten cattle, after its proponents claimed nothing else worked 
as well to clear out a horse's respiratory system. Despite 
evidence suggesting that this drug can alter the muscle mass of 
the heart, it is commonly used in racing.
    And we have created the chemical horse in the name of 
medicine and therapy, when too often it has been done to gain a 
competitive advantage. How else do we explain the widespread 
use of steroids on horses? As Dr. Donald Catlin, whose tests 
are used by the U.S. Olympic Committee, said recently, quote, 
``we have seen how anabolic steroids work in humans. It is 
going to work the same way in horses,'' end quote.
    Ms. Schakowsky. Let me just note for you that your time is 
up. So if you could just take a minute to wrap up, that would 
be great.
    Mr. Shapiro. Clearly there is no place for anabolic 
steroids. But there is one issue larger than all the others. 
Our industry is a chorus of many voices and not always singing 
from the same music. We have no central governance, no uniform 
policy rules and laws that ensure an even playing field in all 
respects. Our structure is dysfunctional and must become 
functional.
    I submit we need a national racing charter; one uniform set 
of rules and policies that governs all who choose to enjoy this 
sport. The regulatory scheme to prevent the use of performance-
enhancing medication is only as good as the ability to find and 
detect the drugs in use. More research and more scientific 
study is needed now.
    We must modernize the way the game is regulated. I do not 
believe a national regulatory scheme should be imposed. It is 
not my preference unless it is the last resort. The industry 
has had decades to find a way for self-uniform governance, and 
it has not happened. If the industry can't do it, we should all 
welcome it. I submit we need a national racing commission. I 
submit to retain its fans, to prosper, racing must act now.
    Ms. Schakowsky. Thank you.
    [The prepared statement of Mr. Shapiro follows:]

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    Ms. Schakowsky. Mr. Van Berg.

   STATEMENT OF JACK VAN BERG, TRAINER, INGLEWOOD, CALIFORNIA

    Mr. Van Berg. Thank you.
    Good morning Chairwoman Schakowsky, all the Members, my 
fellow from Nebraska over there. I hope he didn't work for me 
back them days. He would think I was mean.
    In order to bring integrity back to the sport of 
horseracing, the first and the most important thing should be 
to implement the most sophisticated drug testing available. It 
should be funded by a small percentage of the simulcast money, 
approximately one-eighth of 1 percent. Three labs should 
conduct the testing: one in the West, one in the East, one in 
the Midwest. It would be the responsibility of the trainer or 
his representative to monitor the collection of the sample 
after the race. Half of the test sample would be immediately 
frozen and put in a locker that contains two keys, one for the 
lab technician and one for the trainer. If the test--if the 
other half sent in, if the test comes back positive, then they 
go unlock it together to go to one of the other labs and have 
it taken. If the test is positive, then they should face a 
stiff penalty be imposed on them instead of a slap on the hand. 
But they have got to have the money to do the finest testing 
that can possibly be made.
    As for medication, it would be in the best interest of this 
grand sport and these grand equine athletes to abolish any and 
all medications. This would mean no race-day thresholds of 
Lasix, Bute, steroids, or any other medication. The present 
rule permitting the use of steroids and other drugs have 
compromised the integrity of horseracing and has been a major 
factor in attendance and for interest falling to an all-time 
low. The crowds, most of these racetracks now, you can shoot a 
cannon through them and can't hit anybody.
    Steroids given to these nonconsenting athletes, the time 
they need to develop, the horse can't tell you that he doesn't 
want to take them. Your football players, baseball players, and 
all people can say, no, I don't take them, that is their 
privilege. But the horse hasn't got that. Steroids given to 
young horses can cause an unnatural increase in muscle mass and 
makes them much heavier than their still-maturing bone 
structure. They just get so heavy, and on their young bones 
that haven't matured yet, they just can't take it. But as my 
father once said, fat is the best color in the world, so when 
they go to the auction, the bigger and better and bulkier they 
look, the better they sell. Let the horse develop on his own, 
and the trainer should be enough horseman to know when he has 
matured and ready to proceed in more massive training and pick 
him up.
    As for racing surfaces, they should be a good sandy loam 
and maintained for the soft cushion. I do not think it helps 
our fans to be concerned how fast the race is run. The safety 
of the horse should be the priority, not how fast the track is. 
On big days most racetracks see how fast they can get the 
track. The surface should be maintained at the same depth at 
all times.
    I would like to thank all of you for listening to the 
little bit I have to say. I will be happy to answer any 
questions that anybody desires. Anything that I can do to help 
with this great sport and the integrity of it and these great 
athletes I will be happy to. Thank you.
    Ms. Schakowsky. Thank you.
    [The prepared statement of Mr. Van Berg follows:]

                       Statement of Jack Van Berg

    In order to bring integrity back to the great sport of 
horse racing, the first and most important act should be to 
implement the most sophisticated drug testing available. It 
should be funded by a small percentage of the simulcast money: 
approximately one-eighth of one percent. Three labs should 
conduct the testing-one in the west: one in the east; one in 
the Midwest. It would be the responsibility of the trainer, or 
his representative to monitor the collection of the sample(s) 
after the race. Half of the test sample should be immediately 
frozen and put in a locker that requires two keys to open. One 
key should be held by the trainer and another one held by the 
lab technician. The other half of the sample should be sent to 
the designated lab and tested. If this sample is positive, then 
the trainers and lab technician would unlock the other half of 
the sample and send it to one of the other designated labs. If 
the sample is also positive, then very strict penalties should 
be imposed.
    As for medication, it would be in the best interest of this 
grand sport and these grand equine athletes to abolish any and 
all medications. This would mean no race day threshold levels 
of Lasix, Bute, Steroids, or any other medication. The present 
rule permitting the use of steroids and other drugs have 
comprised the integrity of horse racing and has been a major 
factor in attendance and for interest falling to an all time 
low. Steroids do not give these ``non-consenting'' athletes the 
time they need to develop and mature. Steroids given to young 
horses, they cause an unnatural increase in muscle mass and 
make them heavier than their still maturing bone structure can 
often tolerate. Let the horse develop on his own and the 
trainer should be enough of a horseman to know when he has 
matured.
    As for racing surfaces, they should be a good sandy loam 
and maintained for the soft cushion. I do not think it helps 
for fans to be concerned about how fast a race is run. The 
safety of the horse should be the priority and not how fast the 
track is. On big days, most race tracks see how fast they can 
get the track. The surface should be maintained at the same 
depth at all times.
    I would like to thank everyone for inviting me to testify 
before the House Committee. The sport of Horse Racing is one of 
the greatest sports of all times. I will always be willing to 
do whatever I can to bring back the greatness and integrity of 
this great sport.
                              ----------                              

    Ms. Schakowsky. Mr. Moss.

             STATEMENT OF RANDY MOSS, ANALYST, ESPN

    Mr. Moss. Thank you Vice Chairwoman Schakowsky, Ranking 
Member Whitfield, and other members of the subcommittee. I am 
not Randy Moss, the football player. I have not owned, bred, 
trained, or ridden racehorses. I am not a veterinarian. But I 
do have 30-plus years around racing in various capacities, and 
as a TV analyst for ESPN and ABC, I think I have a degree of 
objectivity here. As Fred Thompson might say, I don't have a 
dog in this hunt, but I think I know when the dog is barking up 
the wrong tree, and I am not afraid to express opinions on how 
the hunt should be conducted.
    And let me add another voice to the chorus you have already 
heard. One problem in this sport that can be dealt with 
immediately is American racing's love affair with medication. 
No other country in the world has permitted thoroughbreds to 
legally race with as many drugs in their systems, and many 
believe the soundness of the breed has been profoundly affected 
in a negative way. The Racing Medication and Testing Consortium 
that you will hear about, the RMTC, is doing admirable work in 
medication reform, but I believe their proposals could be taken 
one step further by returning American racing to running horses 
with nothing in their systems but good old-fashioned hay, oats 
and water; no traces of Butazolidin, Banamine, steroids or 
Lasix, turning back the clock on the culture of drugs and doing 
what is right by the Sport of Kings and what is right for the 
horses themselves.
    As Jack said, at the same time racing also needs to create 
funding mechanisms to streamline and enhance drug testing for 
illegal medications as well. America has its Kentucky Derby, 
the greatest race in the world. We have our Breeder's Cup, the 
greatest day of racing in the world. But regrettably our racing 
is also known worldwide for its obsession with and reliance on 
drugs, and this must change.
    Another major point I want to stress that has already been 
mentioned is the dysfunctional manner in which American racing 
is currently being conducted. Imagine if the NFL permitted 
every State to field as many pro football teams as it wanted, 
to play as many games as it wanted all year round, to create 
different rules of play in each State with no National League 
guidelines to speak of. Incredibly enough this is how American 
racing is currently being played.
    Regulatory power is in the hands of 38 racing States with 
38 sets of rules, 38 different priorities that typically 
consider only the interest of those respective States and not 
the overall health of the game as a whole. American racing has 
no central authority with the power to do what the NFL or the 
NBA or Major League Baseball has, to poll its members and to 
mandate policies with the long-term interest of the sport in 
mind.
    This not only makes problems in racing notoriously 
difficult to rectify, the sport is cannibalizing itself in the 
process with cutthroat competition among racetracks that 
diminishes greatly the quality of racing and also puts too much 
pressure on the horses themselves.
    It is true that few in racing, as I have seen, are eager to 
see Federal involvement. And I would imagine that there are 
more than a few in the Federal Government that don't really 
want to be in the horseracing business, although, if I recall, 
Thomas Jefferson once had a stable of racehorses that I think 
was actually on the grounds of the White House.
    But more to the point, the States that have been entrusted 
with regulating horseracing have proven unable and unwilling, 
more importantly, to rectify many of the problems. And however 
a national focus can be accomplished, this issue desperately 
needs a solution. When horseracing had a monopoly as the only 
legal gambling game around, none of this mattered, but today 
racing faces intense competition for the gambling and 
entertainment dollar. It needs a single-minded and effective 
strategy in the marketplace and not 38 different strategies.
    Thoroughbred racing, in my opinion, is a wonderful sport 
with a rich tradition. Some of that tradition has often meant 
resistance to change. But now with the public outcry, the media 
scrutiny over the deaths of Eight Belles and Barbaro, the 
prevailing attitude within racing, and this is a good sign, is 
that significant change must occur. This is an unprecedented 
opportunity to set a new course in thoroughbred racing. Racing 
needs to capitalize on it, and the public rightly expects 
nothing less.
    Thank you.
    [The prepared statement of Mr. Moss follows:]

                        Statement of Randy Moss

    Thank you, Vice-Chairwoman Schakowsky, Ranking Member 
Whitfield, and Members of the Subcommittee.
    My name is Randy Moss. I work as a horse racing analyst and 
reporter for ESPN and ABC Sports.
    I'm not the football player. I also have never trained 
racehorses, have never ridden racehorses, and I have had no 
veterinary training. I have been asked to join today's 
discussion because I have been close to thoroughbred racing for 
30 years, as a newspaper reporter, handicapper and freelance 
writer; through brief stints as a racetrack manager, jockey 
agent and publicist; and for the last decade in television.
    Because of these positions, I have had extensive 
conversations with trainers, jockeys, owners, breeders, racing 
executives, racing administrators, and veterinarians about a 
variety of issues, some of which are being discussed here. Just 
as importantly, I have a regular dialogue with horseplayers, 
the bettors who are the lifeblood of horse racing but whose 
opinions are too often overlooked.
    As a result of all this, I have developed plenty of my own 
opinions along the way that--for better or worse--I seldom 
hesitate to express.
    For starters, one opinion is that thoroughbred racing 
occupies a unique position in sports--combining tradition, 
excitement, pageantry, the majesty of one of the world's most 
beautiful creatures, and, of course, gambling.
    But in one respect, thoroughbred racing is no different 
than the NFL, NBA or major league baseball: each sport has 
problems and challenges that must be confronted head-on for 
that sport to thrive.
    And thoroughbred racing has its share of issues. Some can 
be easily corrected and others can't. But this is no time for a 
head-in-sand approach.
    The way I see it, the single biggest dilemma facing this 
sport is the haphazard and dysfunctional manner in which racing 
is scheduled and administrated.
    Unlike other sports, racing has no ``league office'' with 
power to make decisions for the long-term best interests of the 
sport. Instead, racing rules and racing dates are set by 
politically-appointed racing commissioners in each state, whose 
decisions are typically motivated by what they perceive to be 
best for that particular state and often are at odds with the 
best interests of the sport as a whole.
    Imagine if the NFL were set up to permit each state to 
field as many pro teams as it wanted, play as many games as it 
wanted all year long, and set its own individual football rules 
with no enforceable league guidelines. In modern-day America, 
horse racing has always been set up in this fashion.
    During the glory days of racing, when horse racing was 
practically the only outlet for legal gambling, it didn't 
matter. In that scenario, racing was almost impossible to screw 
up.
    But now, racing faces intense competition for the gambling 
and entertainment dollar. At a time when the sport desperately 
needs a single-minded and consistent strategy in the 
marketplace, it has 38 racing states with 38 sets of rules and 
38 different priorities. And that is a recipe for disaster.
    Thoroughbred racing is cannibalizing itself. This Saturday 
alone racing will be conducted at Belmont Park on Long Island; 
at Charles Town and Mountaineer Park, both in West Virginia; at 
Delaware Park; at Colonial Downs in nearby Virginia; at Laurel 
Park just across the border in Maryland; at Finger Lakes in 
upstate New York; at Monmouth Park in New Jersey; at Penn 
National, Philadelphia Park, and Presque Isle Downs, all in 
Pennsylvania; and at Suffolk Downs in Massachussetts. And these 
are only the racetracks in the Northeast region of the country.
    Incredibly, each track has determined that this type of 
scheduling is best for itself and its horsemen, even though 
these tracks are essentially competing for the same horses. 
There aren't enough good horses to go around, and thus the 
quality of racing at each track is cheapened, average field 
sizes in the best races are reduced, and consequently 
frustrated horseplayers bet less money.
    At tracks such as Saratoga Race Course, Keeneland Race 
Course, and Del Mar, the sport thrives on short boutique racing 
seasons that create a festival atmosphere and yearly 
anticipation. Unfortunately, too many other tracks are content 
to grind out a profit through quantity instead of quality, with 
endless cards of cheap races run for a dwindling fan base. 
Horsemen are complicit in this, as well, since they typically 
resist efforts to reduce racing dates, as do state racing 
commissioners, who are often reluctant to endorse less tax 
revenue today in exchange for a more positive long-range 
outlook.
    Another effect of these extended racing seasons is the 
pressure it puts on horses, especially in areas of intense 
track-to-track competition such as the Northeast. In a struggle 
to fill races, racetracks are forced to pressure trainers to 
run horses more frequently than they might otherwise feel 
comfortable doing.
    Thoroughbred racing in America is proof that there can 
indeed be too much of a good thing.
    Racing's lack of a powerful central authority is also a 
primary reason for medication controversies currently engulfing 
the sport. In the 1970s, American horsemen began convincing 
state authorities that legalization of raceday medications 
would help them run horses more frequently in support of 
racetracks that were scheduling ever-longer racing seasons. 
Because longer racing seasons pitted tracks against each other 
in intense competition for horses, every state eventually 
conceded to the easing of medication restrictions so as not to 
be at a competitive disadvantage with other states. Thus 
America became the only racing country in the world to permit 
raceday use of drugs such as analgesic Butazolidin and diuretic 
Lasix, which lowers blood pressure and is believed by many to 
reduce the occurance and severity of the EIPH (exercise-
inducted pulmonary hemorrhaging) that hampers the breathing of 
some racehorses.
    Included among accepted raceday medications were anabolic 
steroids such as Winstrol, which is still legal in 28 racing 
states. Steroids would eventually gain widespread use as an 
appetite stimulant and to help horses recover more quickly from 
the effects of exercise and put on muscle mass.
    But well before the highly-publicized breakdowns of Barbaro 
and Eight Belles, many within the sport were becoming convinced 
that lax medication rules were having a negative rather than 
positive effect on American racing.
    Despite the initial arguments that medication would enable 
horses to race more often, the opposite happened. From 1975 to 
2007, average starts per horse per year dropped a staggering 
62%--from 10.23 to an all-time low of 6.31 last year.
    The vast majority of trainers now complain that their 
horses have become much more fragile. Potential explanations of 
this perceived increased fragility are numerous and 
complicated, including the possibilities that medication has 
weakened the gene pool and that commercial breeding practices 
driven by the marketplace have shifted too much toward 
brilliance rather than durability.
    At the same time, raceday use of Lasix has been allowed to 
spiral out of control--even though the drug is banned by the 
World Anti-Doping Agency because it is allegedly used to mask 
the presence of more powerful illegal stimulants. Of the 92 
horses entered to run today at Belmont Park, 88 were designated 
to run on Lasix. This is not what was originally intended.
    Now for the good news: the Racing Medication and Testing 
Consortium (RMTC) was founded in 2002 and under the guidance of 
Dr. Scot Waterman it has made great strides in medication 
reform and recommended penalties for drug offenders. Owners and 
trainers have become frustrated and confused at the different 
medication guidelines for various states, and they have 
gradually begun to embrace uniform rules suggestions developed 
by the RMTC, even though these rules are rolling back raceday 
medication use considerably. Now, according to Waterman, the 
primary difference between medication rules in the U.S. and 
Europe is in the use of Lasix and steroids. The RMTC is 
recommending strong restrictions on steroids, and many states 
are listening.
    One of the holdups, as always, is funding. The RMTC needs 
continued--and additional--funding to continue its good work. 
The sport needs to find the revenue to consolidate its 18 
testing laboratories and enhance testing procedures for items 
such as EPO, or Epogen, which is lesser-known by the public but 
is perceived to enhance performance much more than steroids.
    Also, in the wake of the Eight Belles tragedy, the 
Thoroughbred Safety Committee was formed to tackle the tough 
issues regarding medication, breeding practices and track 
surfaces. The committee's initial recommendations issued 
Tuesday regarding steroids, safety whips and proper racing 
shoes have met with widespread praise, and more recommendations 
are to come. However, the lack of a central racing authority 
forces the Thoroughbred Safety Committee and other industry 
leaders to announce that they ``support,'' ``strongly 
support,'' ``endorse,'' ``urge,'' ``encourage'' and otherwise 
beg and plead for the various racing states to adopt the 
changes. The reason for this language is obvious: the sport has 
no power to ``require'' that changes be made. In the current 
industry framework, any state that wishes to thumb its nose at 
such recommendations is free to do so, with no official 
ramifications.
    After the one-two punches of Barbaro in 2006 and this 
year's Kentucky Derby, mainstream media began a closer 
examination of thoroughbred racing. The public was concerned 
about the humaneness of the sport, and too often were appalled 
at what they were seeing. Racing can and must do better. But 
remember that these issues being debated existed long before 
the demise of Barbaro and Eight Belles, but the sport lacked a 
system as well as a desire to implement needed changes. The 
attention now being focused on these issues, by this committee 
as well as the public, now gives horse racing a rare 
opportunity to conquer its inefficiencies and pull together in 
a positive direction.
    And along with the opportunity comes a sober 
responsibility: this is something the sport can ill afford to 
mess up.
    Some conclusions:
    1) Most in the sport have no desire for federal regulation 
of horse racing. But through whatever means it can be 
accomplished, thoroughbred racing desperately needs a strong 
central authority with regulatory power to make binding 
decisions necessary for the short- and long-term best interests 
of the sport.
    2) The explosion of racing dates must be reversed--and in 
some cases dramatically--perhaps through the formation of a 
league of world-class U.S. racetracks with coordinated racing 
dates, stakes schedules and simulcasting rates.
    3) The use of Lasix as a raceday medication should be 
abolished. At the very least, no horse that has ever competed 
with Lasix or any other race-day medication should be allowed 
to propagate as a sire or broodmare in order to restore the 
integrity of the thoroughbred genetic pool. In addition, all 
graded stakes races--the designation given to the country's 
premier stakes--should be run with no raceday medication.
    4) The Thoroughbred Safety Committee's recommendations on 
steroids, whips, and proper racing shoes should be immediately 
instituted.
    5) Nationwide funding mechanisms must be instituted to: 
ensure the RMTC's continued beneficial research and 
recommendations, including development of additional post-race 
tests for illegal drugs; consolidate the country's 18 
laboratories used for post-race testing into one or two 
``superlabs'' with capabilities and resources to conduct 
testing for all prohibited substances; pay for enforcement of 
drug penalties, including legal costs associated with appeals.
    6) The study of racetrack surfaces must continue to 
determine if synthetic surfaces actually reduce instances of 
catastrophic injury in thoroughbreds as compared to well-
maintained dirt surfaces.
    7) Rules should be instituted to hold veterinarians 
accountable in drug offenses as well as the trainers who employ 
them.
    8) The U.S. should convene a summit with other major racing 
countries to develop regulations that could extend the careers 
of top racehorses, i.e., a rule requiring all sires or 
broodmares to be at least 5 years of age to conceive a 
registered thoroughbred racehorse.
                              ----------                              

    Ms. Schakowsky. Mr. Hancock.

  STATEMENT OF ARTHUR HANCOCK, PRESIDENT, STONE FARM, PARIS, 
                            KENTUCKY

    Mr. Hancock. Good morning, Madam Chairwoman Schakowsky, and 
Ranking Member Whitfield and members of the subcommittee. I am 
a fourth-generation horseman, and I have children who are 
interested in this way of life, and I hope to protect it for 
them, and that is why I am here.
    There are many wonderful aspects about the horse business: 
the beautiful farms, the rich tradition, the pageantry, the 
excitement of competition, the thrill of victory. But there are 
many negatives in the industry that I am concerned about, such 
as inbreeding, overbreeding, oversupply, operations on young 
foals which are not required to be divulged, bribing at 
auctions, and other issues which we need to fix ourselves. But 
my primary worry and the main issue which concerns me is the 
complete lack of uniformity on many issues, specifically the 
permissive medication policies that vary from State to State 
and the catastrophic result that this medication is wreaking 
upon our industry.
    There are 38 racing jurisdictions in the United States, and 
they all have their own rules. As you know from recent stories 
in the news, use of steroids is rampant, and the rules 
governing its use vary from State to State.
    So why are we in this situation, and how can it be 
remedied? What is this thoroughbred industry? It is a 
conglomeration of different entities, each of which has its own 
function as well as its own agenda. They are the breeders, the 
owners, the veterinarians, the trainers, the jockeys, the 
racetracks, and all of their affiliated organizations. It is a 
mega agribusiness worth billions of dollars that employs 
thousands of people who are represented by all of these 
separate and different entities. There is TOBA, the Jockey 
Club, the Jockey's Guild, the NTRA, the Breeder's Cup, the 
American Horse Council, the AAEP, the HBPA, the RCI, and the 
racing commissions of 38 different States. They are like 
fiefdoms, and they each have their own Nero-like CEO who 
envisions himself as the savior of racing and usually doesn't 
even own a horse.
    As I see it, the real problem with the thoroughbred 
industry is that nobody is in charge. We are a rudderless ship, 
and the way we are going, we will all end up on the rocks. It 
is impossible for us to govern and regulate ourselves. We are 
simply too fragmented and too diverse. Not one of these groups 
has the power to bring uniformity and integrity to our sport. 
In my opinion, only the Federal Racing Commission or 
Commissioner can save us from ourselves.
    Congressman Ed Whitfield of Kentucky says that the 
Horseracing Act of 1978 is a vehicle through which we may 
remedy this situation. Each State can be controlled by the 
Federal Government, because if the State does not comply with 
the rules, the racing signal can be cut off. For instance, if 
there is a Federal ban on steroids, and the State does not 
comply, it would lose its signal.
    I have said for years that we must remove drugs from our 
game. In 1960, horses made 11.3 starts a year; last year they 
made 6.31 starts. This is a drop of 44 percent, and it is a 
startling statistic which shows that the breed is becoming 
softer and weaker. This leads one to the inescapable conclusion 
that there will be more frequent and more severe catastrophic 
injuries in the future, and that these will do us irreparable 
harm irregardless of the track's surface. It is a vicious 
cycle. Chemical horses produce chemical babies. Performance-
enhancing drugs must be banned if we are going to survive as an 
industry and if thoroughbreds are going to survive as a robust 
breed. Believe me, we are in peril.
    I am reminded of a story. There was once a large, fine 
house, and a lot of mice lived in there, and they had lots of 
cheeses, but the owner got a cat, and the mice didn't know what 
to do. Somebody made the brilliant suggestion that they put a 
bell on the cat, and they thought that was a great idea. Oh, 
good, we will put a bell on the cat. Then somebody came up and 
said, one of the mice said, but who is going to be the one to 
put the bell on the cat?
    This is our dilemma, ladies and gentlemen. We have no one 
to put the bell on the cat. It is impossible for us. The 
fiefdoms cannot come together, and yet they will violently 
object to the prospect of any infringements upon their domains. 
Our only hope is the Federal Racing Commissioner or Commission, 
and I have said this since 1990.
    In the early 1980s, Senator Mathias of Maryland spoke to 
the Jockey Club Roundtable in Saratoga and warned us to clean 
up our act, or the government would do it for us. The industry 
mobilized, went to Washington and said we would do it 
ourselves, and the results speak for themselves. That was 28 
years and hundreds of committee meetings ago, and things have 
gotten worse, not better. It never happened and never will 
unless you mandate through the Horseracing Act that we have the 
means to bell the cat.
    Professional basketball, what would it be without a 
commissioner, without the NBA, or professional football without 
the NFL, or baseball without a commissioner?
    Mr. Rush. Mr. Hancock, your time is expired, so if you 
could just wrap it up.
    Mr. Hancock. OK. Let me just close with a point Winston 
Churchill wrote. He said:
    ``Who is in charge of the clattering train,
    The carriages creak and the couplets strain.
    And the pace is fast and the points are near,
    But sleep has deadened the driver's ear.
    And the whistle shrieks through the night in vain,
    For death is in charge of the clattering train.''
    Ladies and gentlemen, death is not in charge of our 
business yet, but he is on board. Please give us an engineer. 
Thank you very much.
    Ms. Schakowsky. Thank you.
    [The prepared statement of Mr. Hancock follows:]

                      Statement of Arthur Hancock

    Good morning, honored Members of Congress.
    I am here before you because I am gravely concerned about 
the future of the Thoroughbred industry. I am a fourth 
generation breeder and owner and I also have children who are 
interested in this way of life.
    There are many wonderful aspects about the horse business--
the tradition, the pageantry, the competition, and the thrill 
of victory--but there are many negatives in the industry that I 
am concerned about such as inbreeding, over breeding, 
oversupply, operations on young foals which are not required to 
be divulged, bribing at auctions, and other issues which we 
have the means, if not the desire, to rectify. But my primary 
worry and the main issue which concerns me is the complete lack 
of uniformity on many issues; specifically, the permissive 
medication policies that vary from state to state, and the 
catastrophic results that this medication is wreaking upon our 
industry.
    There are 38 racing jurisdictions in the United States and 
they all have their own rules. As you know from recent stories 
in the news, use of steroids is rampant and also varies from 
State to State.
    So, why are we in this situation, and how can it be 
remedied? What is this Thoroughbred industry? It is a 
conglomeration of different entities, each of which has its own 
function as well as its own agenda. There are the breeders, the 
owners, the veterinarians, the trainers, the jockeys, the race 
tracks, and all of their affiliated organizations. It is a mega 
agri-business worth billions of dollars that employs thousands 
of people who are represented by these separate entities. There 
is T.O.B.A. (Thoroughbred Owners and Breeders Association), The 
Jockey Club, the Jockey's Guild, the N.T.R.A. (National 
Thoroughbred Racing Association), the Breeders' Cup, the 
American Horse Council, the A.A.E.P (American Association of 
Equine Practitioners), the H.B.P.A (Horsemen's Benevolent 
Protective Association), the R.C.I. (Racing Commissioners 
International), and the racing commissions of 38 different 
racing jurisdictions. All of these fiefdoms have their own 
Nero-like CEOs, each of whom envisions himself as the savior of 
racing and most of whom don't even own a horse.
    As I see it, the real problem with the Thoroughbred 
industry is that nobody is in charge. We are a rudderless ship, 
and the way we are going, we will end up on the rocks. It is 
impossible for us to govern and regulate ourselves. We are too 
fragmented and too diverse. In my opinion, only a Federal 
racing commission or commissioner can save us from ourselves.
    Congressman Whitfield of Kentucky says that the Horse 
Racing Act of 1978 is the vehicle through which we can remedy 
the situation. Each state can be controlled by the Federal 
Government because if it does not comply with the rules, its 
racing signal can be cut off. For instance, if there is a 
Federal ban on steroids and a state does not comply, it would 
lose its signal.
    I have said for years that we must remove drugs from our 
game. In 1960, horses made 11.3 starts per year and in 2007 
they made 6.31 starts per year. This is a dramatic drop of 44% 
and is a startling statistic which shows that the breed is 
becoming softer and weaker. This leads one to the inescapable 
conclusion that there will be more frequent and severe 
catastrophic injuries in the future. These will do us 
irreparable harm. It is a vicious cycle. Chemical horses 
produce chemical babies. Drugs must be banned if we are going 
to survive as an industry and if thoroughbreds are going to 
survive as a robust breed. Believe me, we are in peril.
    I am reminded of a story. There was once a large fine house 
wherein lived a number of mice. There were plenty of scraps of 
fine cheeses, breads and cakes, and the mice flourished. Then 
the owner decided to get a cat and this cat wreaked havoc on 
the mice and their comfortable lifestyle. All of the mice 
convened in an effort to find a solution to this life-
threatening problem, and they decided to put a bell on the cat. 
This was considered to be a wonderful idea and was hailed 
throughout mousedom. Then one of the mice said, ``But who will 
be the one to put the bell on the cat?''
    That is our dilemma: we have no one to put the bell on the 
cat. It is impossible for us, and we cannot do it. Our only 
hope is a federal racing commissioner or commission, and I said 
this publicly in 1990.
    In the early eighties, Senator Mathias of Maryland spoke to 
The Jockey Club Round Table in Saratoga and warned us to clean 
up our act or the government would do it for us. The industry 
mobilized and went to Washington and said it would do it..and 
the results speak for themselves. That was twenty eight years 
and hundreds of committee meetings ago. It never happened and 
will not happen in another 28 years unless you mandate through 
the Horseracing Act of 1978 that we have the means to bell the 
cat. Where would car racing be without NASCAR, professional 
basketball without the NBA, professional football without the 
NFL and AFL, or baseball without a commissioner?
    Some years ago, baseball had a problem with steroids and 
because of a federal inquiry it has now cleaned up its act, yet 
baseball has a commissioner.
    So, why can't we do something about the drug situation on 
our own? The answer is, there is big money behind these drugs 
and there is a lot of pressure to continue with the status quo. 
When I worked at the race track in 1966, the only time the 
veterinarian came to the barn was to check the horse on race 
day or if he was sick. Now, they are there every day, and 
veterinary bills for owners can run over $1,000.00 a month on a 
single horse. Last year, I told a veterinarian that I did not 
want my horses to get any medication unless they were sick and 
he replied, ``You want to win races, don't you Arthur?''
    Now I don't mean to say that all race track veterinarians 
are bad people and I don't in any way mean to disparage them. I 
respect them. The drugs they give a horse are for the most part 
legal, although there are some who will use the masking power 
of legal drugs to mask other more sinister and illegal 
substances. For instance, cobra venom was recently discovered 
in the possession of a trainer and it was given to him by his 
veterinarian. If evil can exist, it will. If evil is permitted, 
it will prevail. America, by the way, is the only nation on 
this planet which permits the use of most of these medications. 
Steroids are banned in every other country.
    The drug issue is destroying public confidence as well as 
the breed. People wonder why we haven't had a Triple Crown 
winner since the seventies. Well, when a horse gets Lasix in 
the Kentucky Derby and loses 30 to 40 pounds and the same thing 
happens in the Preakness 2 weeks later, how can he be at full 
strength for the Belmont where he gets it again; all of this in 
the span of 5 weeks, and Lasix is not the only drug the horse 
gets. He may get steroids and many other drugs, like 
butazolidin.
    So, I am convinced and terrified that we are losing our 
industry, the public confidence, and the American breed called 
the Thoroughbred. The horse is the star. He is our show, and 
look what we are doing to him. Please help us right these 
wrongs. Let us remember that the definition of insanity is 
repeating the same behavior over and over again expecting 
different results. Let us have zero tolerance and a national 
lab for testing. Any expense to create integrity and save the 
breed would be cheap. Ben Johnson said that nothing can be 
great unless it is right. Please help us make horse racing 
right and great again. The very survival of our industry is at 
stake here, ladies and gentlemen.
    I would like to close with a poem written by the late 
Winston Churchill.
    ``Who is in charge of the clattering train,
    The carriages creak and couplets strain.
    And the pace is fast and the points are near,
    But sleep has deadened the driver's ear.
    And the whistle shrieks through the night in vain,
    For death is in charge of the clattering train.''
    Thank you for listening to me. Your time and efforts are 
deeply appreciated and it has been a privilege and honor for me 
to appear before you.
    Thank you, and good day.
                              ----------                              

    Mr. Schakowsky. Mr. Jackson.

   STATEMENT OF JESS STONESTREET JACKSON, STONESTREET FARM, 
                    GEYSERVILLE, CALIFORNIA

    Mr. Jackson. Chairwoman Schakowsky, Ranking Member 
Whitfield, members of the committee, as you know, I am an 
advocate for reform, probably one of the more outspoken, and 
the best of the advocates for reform are sitting here at this 
table. I commend you on your wisdom in choosing to open the 
dialogue and deal with the problem.
    I am Jess Jackson, proprietor of a winery called Kendall 
Jackson, but more recently returned to thoroughbred racing. I 
own Stonestreet Farms, with farms in Kentucky, Florida, and 
California. I have stables. One of the 60 horses we are 
training and running right now is Curlin, the world champion. I 
am very proud of him. Curlin represents a horse that can run 
without drugs, not that he didn't in the past, but we changed 
that, and when he went to Dubai, he won without drugs. Dubai 
does not tolerate drugs.
    We appreciate the opportunity, my family, to address you 
today. I am an eighth-generation horseman. My great-great-
grandfather ran the King Ranch after Captain King died in 
Texas. I have been around horses since I was 6 years old, and I 
saw Sea Biscuit run when I was 9 years old. I have seen a lot. 
I was one of the voices to oppose Bute when it came in in the 
1950s and 1960s.
    The vast majority of the people in our business are honest, 
hard-working and wish that the change in the industry would 
happen. They have no leadership. None. Mr. Hancock explained 
that to you. We have so many diverse, disparate princedoms and 
fiefdoms in the industry that we can't organize. If you raise a 
point on one industry, somebody else will oppose it.
    I believe that in Congress, if you raise amendments or 
bring leadership, you will have opposition from parts of the 
industry. That always happens. We always say we can do it 
ourselves. We always say we can plan. We need to study it more. 
We are experts at delay. We never get it done. We need 
leadership and help.
    Your concerns are very well founded. I believe we need 
Congress to take an active role in two specific areas 
immediately. First, on drugs: ban them. For centuries horses 
ran without drugs. Drugs are not needed to run thoroughbred 
horses. The competition between trainers, when one is convinced 
by a veterinarian to enhance the performance of his horse, the 
others want to have a fair chance against that competition, and 
so it is like a plague, it spreads.
    We have to also discipline the veterinarians who supply the 
drugs. Why do we arrest the user and discipline him with a slap 
on the hand when the real problem comes from the seller?
    We have to deal with it bluntly. I am against drugs. We 
need uniform standards. We need new laboratories to test. And 
we need zero tolerance of drugs.
    Again, for centuries, horses ran without drugs. We don't 
need Lasix. We don't need Bute. We certainly don't need 
steroids or enhancers. We don't even need coffee. The horse can 
run.
    And he runs naturally. He wants to run. That magnificent 
animal lives to run. Just watch a young foal in the field about 
sundown when he is getting ready for bed. The last thing he 
does is run madly around the entire pasture.
    Drugs mask other drugs. Don't think that an aspirin might 
not mask another designer drug. It can; we don't know. We can't 
keep up our science with enough advancement to answer all of 
the designer drugs that they are creating out there for humans 
as well as horses.
    And the ethics of dealing with an animal shows the ethics 
of the human. We need to have ethics, honesty, and trust in 
this industry.
    My second point is that Congress should eliminate two words 
in the Interstate Horse Racing Act. As presently written, the 
IHA provides that a host racing association must have an 
agreement with the, quote, ``horsemen's group,'' which is 
defined as the group which represents the majority of owners 
and trainers. Take out those two words, ``and trainers.''
    The trainers work for owners. Jockeys work for owners. The 
horse is owned by the owners. The owners are the lifeblood of 
the industry. Why give the power to an agent to commit the 
owners?
    Ms. Schakowsky. Let me just call to your attention your 
time is up. So if you could wrap up, we would appreciate it.
    Mr. Jackson. All right, well, OK.
    The IHA needs to be amended; it truly does. The trainer is 
under the thumb of the track, to get his gait, to get his 
stall, to get his stable. He is not the qualified agent for the 
owners. We need a national organization to represent the owners 
like any number of other--ASCAP, for instance, to deal with all 
of the various tracks.
    And let the owners--if you take those two out, the owners 
will unite themselves. You won't need a bureaucracy to run it. 
The TLC in California, the horse group in Ohio, Florida, Texas, 
New York, they will come together. They fear antitrust action, 
and you might pay attention to that as well. But the point is 
that they will voluntarily cure all these problems and organize 
if you just let them and take away the fear that, if they do 
organize, they are going to be litigated. That is a serious 
concern.
    We need to fix the broken economic model. But the industry 
can do that if you adjust that.
    Now, you need to study breeding and other issues. It is a 
very serious thing. We have inbred impurities. We concentrate 
speed instead of the upper body. We look for an Arnold 
Schwarzenegger's upper body and then we look for Don Knotts's 
legs and knees. We don't need all of the inbreeding we have. We 
need outcrossing. I go to Argentina to buy horses, I go to 
Germany to buy horses, because they have stronger bones and 
better knees.
    And we need a league and a commissioner.
    I will wrap it up: it is a tragedy these issues are before 
you today. None of these ideas are new. We have been debating 
them for almost my entire life; I am 78 years old. We need 
action. Please, Congress, help us.
    Thank you.
    [The prepared statement of Mr. Jackson follows:]

                 Statement of Jess Stonestreet Jackson

                                Summary

    Thank you for the opportunity to testify today. I welcome 
congressional help and there are two areas that require 
immediate action: first, a broken business model must be fixed 
and second, drug use and other safety standards need to be 
addressed.
    These problems have common root causes: The lack of a 
national and responsible horse owners' organization; the lack 
of transparency in industry practices; the lack of uniform 
standards; and most importantly, the lack of accountability and 
enforceability. All of which can be corrected by an effective 
horse owners' organization. It is clear to me that most of the 
industry's present ills stem from the fact that we are a 
national, or international, sport, that has no competent 
central regulating body or federal authority mandating 
uniformity in the United States. While one or more of the 
present organizations may, with the best of intentions, 
``study'' various issues, few have the authority and none 
enforce uniform national standards. Some of these issues have 
been studied, as with the banning of performance altering 
drugs, for decades without action. As this Committee properly 
senses, we need less STUDYING and more DOING.
    While I do not favor more federal regulation or 
bureaucracy, I do think that a carefully crafted charter, or 
other vehicle, for a federal horse racing association 
(representing horse owners) is urgently needed to ensure better 
treatment for the horses and enhance the revenues for both the 
tracks and the horse and improve the integrity and safety of 
the sport.

                               Testimony

    Chairwoman Schakowsky, Ranking Member Whitfield and Members 
of the Subcommittee, good morning. My name is Jess Jackson. I 
am here today because of my lifelong passion for the sport of 
thoroughbred racing and breeding and my role as a relative 
newcomer to thoroughbred ownership. My life experiences include 
many vocations. I was a law enforcement officer, a practicing 
attorney, and a member for the Center for Democracy. I am also 
the founder of Kendall-Jackson Winery. At heart, I am a farmer.
    I appreciate the opportunity to address you today on 
matters of importance concerning the sport and business of 
thoroughbred racing. While we are all deeply saddened that the 
tragic injuries to horses such as Barbaro and Eight Belles may 
be the impetus for this hearing, I believe most owners of 
horses nationwide, including a large silent majority connected 
to thoroughbreds, are very encouraged that Congress is holding 
this hearing today. We need Congress to take an active interest 
in assuring the integrity, safety, and economic viability of 
this magnificent sport.
    My passion for horses and the sport of horse racing dates 
back more than seven decades. As a boy growing up in 
California, I had the privilege to watch Seabiscuit--one of the 
most popular thoroughbreds of all time--run in a race not too 
far from my home. That memory has stayed with me all these 
years, and helped forge a strong affection for horses and a 
deep appreciation of their beauty, power, elegance, and 
athleticism.
    I am a life-long fan of thoroughbred racing. Through hard 
work and perhaps a fair dose of good luck, I have found myself 
in a position to pursue my passion for thoroughbred horses as 
more than just a fan. I am 78 years old. I had hopes to ease 
into my retirement but instead, a few years ago, my family and 
I returned to raising and racing horses which led to the 
establishment of Stonestreet Stables. I wanted to join and 
participate in a great agriculture industry whose vast majority 
are honest, hardworking people producing what was and can again 
be a top sport and entertainment industry.
    Today, Stonestreet Farm owns over 100 broodmares and their 
foals, and our Stonestreet Stables currently races and trains 
60 or so thoroughbred horses. Among them is Curlin, in whom we 
own an 80% interest. Curlin is an amazing horse. In 2007 he was 
Horse of the Year, placed in all the Triple Crown races and won 
the Breeders Cup. He won the Dubai World Cup in March and is 
ranked as the number one thoroughbred in the world. This past 
weekend, at Churchill Downs, he raced to first place to the 
applause of thousands of spectators.
    The Committee's concern about the health and welfare of 
thoroughbred horses, as well as the overall status of the horse 
racing industry, is very well-founded. As excited as my family 
is about getting into the thoroughbred racing arena, and about 
the enormous success of Curlin, our enthusiasm has been 
tempered by the realization that the sport of thoroughbred 
breeding and racing faces serious challenges that imperil its 
future in America.
    There are two areas that require immediate action: first, a 
broken business model and second, drug use and other safety 
standards.

                        A BROKEN BUSINESS MODEL

    A Commissioner and a horse owner-based governing body are 
urgently needed. It is the only way to fix the industry's 
broken business model. The absence of a legitimate national 
governing body with federally-sanctioned authority to make and 
enforce consistent rules, regulations and standards is 
desperately needed. Correspondingly, we need Congress' support 
to amend the Interstate Horseracing Act (IHA) in order to 
immediately permit those who are the real investors, the real 
parties in interest, race horse owners, to organize. For 
instance, the thoroughbred horse owners provide all the capital 
for the horses that race, but are unable to organize for fear 
of anti-trust litigation. An immediate example is the lawsuit 
filed by Churchill Downs against the Kentucky and Florida horse 
owners' groups. If permitted to organize through their 
respective state thoroughbred owners groups, private non-
federal entities, and participate in and help make the complex 
business decisions in today's marketplace, revised integrity 
and economic models would soon be enacted nationally. To show 
the economic advantages of such amendments to the IHA I have 
attached to my testimony an article by Fred Pope entitled, 
``Change the Law--Engage Racehorse Owners.'' In this article, 
Mr. Pope describes in detail the economic plight of the 
thoroughbred racing industry. In pertinent contrast, The Jockey 
Club in England is an effective private organization that sets 
the rules and enforces them. In the United States, our Jockey 
Club acts as a mere registry of birth and ownership transfer. 
If horse racing is to regain the immense popularity it 
historically proved, we, the horse owners, must be permitted to 
organize and to have a league of our own. While such a league 
may be either private or public, to succeed it is clear that we 
will need your help--the right to organize safely from spurious 
anti-trust litigation. And as thoroughbred owners we must be 
permitted to participate at the negotiations between the 
tracks, the off track betting industry and the TV betting media 
(advance deposit wagering or ADWs).
    In the absence of a healthy new economic model, the most 
promising source of return on a horse owner's investment 
increasingly comes from breeding their horses. Current 
estimates are that horse owners in racing invest over $4.3 
billion a year for the chance to compete for approximately $1.1 
billion in purses. The result is that most horses' racing 
careers are geared toward maximizing, at all costs, the horses' 
early retirement potential for a successful breeding career, 
and not continuation of racing. In practical terms it means we 
are racing juvenile horses too soon and racing 2-year-old 
horses before their bones and joints are fully developed should 
end. Moreover, racing 2- and 3-year-olds can result in serious 
career ending injuries as witnessed on national TV with 
Barbaro, Eight Belles and others. There is every incentive to 
compress horses' racing careers, racing them to young and 
retiring them too soon, in order to get them to stud sooner and 
avoid the risk of breakdown. I join with others including many 
prominent and successful trainers who urge that horses be 
barred from racing until they are much older.
    When we decided to race Curlin as a 4-year-old, it 
astounded many in the industry that we would put aside a year's 
breeding revenue of about 15 million dollars, an amount far 
greater than we could earn on the track, run the risk of loss 
or injury from racing and incur the multi-million dollar cost 
of insuring Curlin for racing. But my family and I wanted to 
give the industry a boost and share Curlin's speed, brilliance 
and stamina with the fans. In defining Curlin we personally 
risk his serious injury and even his death. Since making that 
decision, we have been overwhelmed with congratulations and 
support from fans and owners around the world. Curlin continues 
to earn his legacy as an American champion for the ages, 
bringing pride and good will both to the industry and our 
country, both here and abroad. Most importantly, his stamina, 
power, durability, and speed have proven the value of racing 
stronger and more experienced horses, and (so far) has 
validated our decision. His ultimate impacts may be to 
propagate his DNA through his progeny for a sturdier breed and 
serve as an example for racing older horses.
    The fans are important to me and to the industry. Let's 
look at racing for a moment from their point of view. Purses 
have dwindled to the point where fewer owners enter their 
horses in any but the most lucrative venues. With the advent of 
off-track betting and fewer horses racing and smaller gates and 
purses, many tracks do not have the financial resources to 
maintain much less expand their facilities, which results in a 
less enjoyable and less friendly family and social experience 
for spectators. Contrast this to Hollywood or Del Mar in the 
days of Bing Crosby.
    We need an open and frank dialogue about the gaming side of 
our sport. While betting exists in all sports, there is no 
doubt that it has corroded our industry more than others. If 
you go to any track in America today, the front and the back of 
the house are in deteriorating conditions. Why? Because off-
track betting is getting more money then the tracks themselves 
which in turn prevents the tracks from becoming state of the 
art facilities both for the horses and the fans. (See Mr. 
Pope's article). It is also a disincentive for tracks to put on 
an entertaining live show for its spectators. Even if they 
could afford to do it, why should host tracks spend money on 
live racing or greater purses when the lion's share of gaming 
revenue is diverted from the tracks and horses who put on the 
show (and risk their capital) to mostly benefit off-track 
revenue which does little to enhance track or horse revenue. 
Last year, racehorse owners lost out on about $540 million 
purse accounts due to off-track wages. That is double the 
amount of annual prize money on the Professional Golf 
Association (PGA) tour. I personally admire the PGA and the 
Association of Tennis Professionals (ATP) as private models 
which uphold both the integrity and financial viability of 
their respective sports and their participants. We need a 
better business model and we need it now. Horseracing may not 
survive without one.

             THE HORSE INDUSTRY'S DRUG AND SAFETY PROBLEMS

    a. We Must Ban Improper Use of Drugs
    Speaking bluntly, the horse industry has a drug problem. We 
must replace the existing patchwork of state standards with a 
uniform national standard that is in accord with international, 
ZERO-TOLERANCE rules. Congress should start by banning steroids 
immediately, at any level, for horses in competition. Lasix and 
Bute should be banned as well--now--and should have been banned 
50 years ago. These drugs mask pain and, worse, may mask 
designer drugs including hormones and steroids, all of which 
should be banned if they affect the track performance or 
physical appearances of a horse at public auction or private 
sale. The very fact that there is a debate about steroid use in 
the Triple Crown, regardless of the merits, is damaging to, and 
casts a shadow over racing. If one veterinarian (prospering 
from its sale) convinces one trainer to use a drug other 
trainers may feel compelled to do likewise in order maintain a 
``level playing field.'' But does the horse have a say? It is 
essential to conform to international standards and ban these 
drugs now for other than true medicinal use. No horse entering 
racing should have one iota or trace of artificial steroids, 
hormones, or drugs.
    Medication testing must be centralized and independent, 
possibly using the USADA (United States Anti-Doping Agency) 
model. Infractions must be adjudicated swiftly and decisively. 
Punishments must be severe, predictable and uniform. Currently, 
most violations go to state-run administrative law proceedings 
which can take years to resolve. It is unbelievable to me that 
trainers who have been permanently barred in other 
international racing venues are merely ``suspended'' for 3 
months in the United States for illegal drug use, such as Cobra 
venom!
    b. We Must Make Racing Safer For Horses
    The state of the breed is not what it used to be. To put it 
in simple terms, the industry focuses excessively on breeding 
horses for early, brilliant speed at relatively short 
distances. Today, too many breeders end up producing heavily 
conformed upper body muscled horses with relatively fragile 
legs (Barbaro) and feet (Big Brown). The current structure of 
the graded stakes races in the United States encourages 
breeding this type of horse, and indeed practically demands it. 
We can improve the breed by mandating transparency in medical 
histories, revising the racing calendar and understanding track 
surfaces' effect on equine health.
    Due to the absence of transparency about the frequency and 
cause of racing related injuries as well as the lack of 
consistent access to medical records, conscientious breeders do 
not have sufficient information available to make fully 
informed breeding decisions. The careers of racing horses are 
too short to provide much of a racing history on which to base 
predictions of the performance of their offspring. All 
contributing to the weakening of the breed.
    The larger problem is that obtaining accurate medical 
records for horses is extremely difficult. Most jurisdictions 
do not adequately regulate medical record keeping for horses 
and in some states (including California) medical records 
belong to the person who paid the veterinarian and are not 
available to the new buyer/owner. Worse, an uninformed buyer 
may race a horse with an increased risk of injury or death. 
Just as Google is moving to establish a confidential, 
centralized, online database for human medical records, so 
should there be a repository of accurate horse medical records 
and ownership. Also, maintenance of accurate medical and 
ownership records available to the industry and all its 
prospective owners and breeders of the horses during both sale 
and racing is essential. Through ownership records the physical 
and medical history of equine can be verified. True ownership 
records also would help prevent fraud occurring at auctions and 
private sales where wrongdoers can falsify bids and documents 
of a horse's prior sale and medical histories. It is important 
at sale to provide a potential purchaser with an accurate 
picture of the horse and to disclose potential health problems. 
For example, chronic steroid use, in addition to creating 
health risks to horses, can cause irreparable fertility damage, 
and is certainly information that is material to a high dollar 
stallion purchase deal and his fertility performance as a 
stallion.
    Similarly, the racing calendar needs to be revised in the 
best interest of the horse and coordinated across tracks and 
states. A national racing commissioner could do this. A league 
of racing could restore excitement and marketing to this noble 
sport. One option is have the Triple Crown spread out with the 
Kentucky Derby on the first Saturday in May, the Preakness the 
first Saturday in June, and the Belmont the first Saturday in 
July. This will promote rivalries, give the horses more rest 
and recovery time between races and allow for a better approach 
towards marketing the sport. The Triple Crown is, rightfully, a 
difficult achievement and I am not advocating that the path be 
made easier simply because we have not had a Triple Crown 
winner in decades. However, as the Triple Crown currently 
stands, these magnificent ``too young'' horses must overcome 
the gauntlet-like nature of the grueling schedule rather than 
the level of competition.
    We also need to place the emphasis back on the competition 
between more mature older horses to reduce juvenile injuries, 
breakdowns, and catastrophic deaths. Accordingly the Triple 
Crown races could be limited to 4-year-olds. Today these races 
effectively mark the end of the viable racing career of high-
value successful, but young race horses. Looking at the 
schedule of graded stakes, there are relatively few races for 
horses older than 3 years and the disparity in earning 
potential between what 4-year-olds and older horses can make at 
the racetrack and what they may earn in the breeding sheds 
generally forces most horses into retirement at or before the 
end of their third year of age. Curlin and other 4 year and 
older horses are having trouble finding sufficient races in 
which to run in the U.S. and must go overseas for races with 
purses three to ten times higher than current purses in the 
United States.
    Moving the age of the participants up to 4 would permit 
horses to develop at a more reasonable pace before being 
pointed towards the Triple Crown and allow for more seasoning 
and conditioning. The result would be stronger, healthier and, 
more skilled equine athletes. This will have the additional 
effect of lengthening the racing careers--and starts--for 
almost all thoroughbreds, which then gives a prospective 
breeder more information about the soundness, ability, 
strengths and weaknesses in a given horse or bloodline which 
would tend to help breeder's avoid inbreeding genetic defects 
thus strengthening the breed.
    As it stands now, the racing careers of sire prospects are 
so short that it is difficult to reasonably predict the long 
term genetic characteristics of their prospective progeny. I am 
told a famous, old time breeder long ago said he would not 
breed a horse less then 4-years-old and had not run at least 
fifteen races. In the last thirty years the total number of 
races a typical thoroughbred runs before retirement has been 
reduced from over twenty to about six.
    Finally, we need to better understand the effect of track 
surfaces on race horses. While we are in favor of whatever 
track is safest for horse and rider, we are also wary that by 
focusing on developing safer track surfaces we may ignore that 
we now have a less durable breed. We must do both: study race 
surfaces and improve durability genetics. The thoroughbred has 
raced on dirt and grass for centuries. Is the current lack of 
stamina and bone due to historic racing surfaces or more likely 
to weak inbreeding for speed? We have handsome upper bodies but 
fragile legs. Both bone and sinew have degraded. We should 
focus on the cause (breeding weakness) not merely a racing 
surface. The root problem should be fixed--breed more durable 
horses.

                               CONCLUSION

    All of all these problems have common root causes: the lack 
of a responsible horse owners' national organization; the lack 
of transparency in industry practices; the lack of uniform 
standards; and, most importantly, the lack of accountability 
and enforceability can all be corrected by an effective horse 
owners' organization. Through that new founded organization, 
horse owners must change a poor business model eliminate 
``drugs and thugs'' and restore safety. It is clear to me that 
most of the industry's present ills stem from the fact that we 
are a national, or international, sport, that has no competent 
central regulating body or federal authority mandating 
uniformity in the United States. Individual states each have 
their own regulations that differ, and there are multiple and 
inept trade groups currently existing that represent limited 
elements of the industry, mostly the breeders, (the sellers) 
not the owners (the buyers). But unlike every other major 
sport, we have no organization or entity that effectively 
regulates and markets the sport. While one or more of the 
present organizations may, with the best of intentions, 
``study'' various issues, few have the authority and none 
enforce uniform national standards. Some of these issues have 
been studied, as with the banning of performance altering 
drugs, for decades without action. As this Committee properly 
senses, we need less STUDYING and more DOING.
    I do not favor more federal regulation or bureaucracy. 
Where possible, I do think that a carefully crafted amendment 
to charter a federal horse racing association (representing 
horse owners) is urgently needed to ensure better treatment for 
the horses and enhance the revenues for both the tracks and the 
horse and improve the integrity and safety of the sport. A 
national organization would also overcome the most common 
objection to reform at the state level--namely, that reform in 
any one state will simply drive owners, breeders and business 
to other more lenient state jurisdictions.
    If we are to restore thoroughbred racing to its 
longstanding position as a cherished national pastime, we must 
start by protecting the health and dignity of the wonderful 
athletes that delight and thrill us all. Establishing a 
meaningful governing body with authority to set and enforce 
standards in the interest of all stakeholders is the best way 
to accomplish this most worthy goal. We must also return the 
sport to our buyers (the owners of the horse) and to our racing 
fans (our ultimate entertainment consumers). As in any sport 
the both the participants and the fans are the backbone of the 
industry. And in the end, if we can accomplish these noble 
objectives, we will have properly honored the great legacies of 
true heroes such as Man o' War and Seabiscuit.
    Thank you for the honor and the opportunity to testify 
today.

                                 # # #

                Change the Law--Engage Racehorse Owners

  Amending the Interstate Horseracing Act will Engage Racehorse Owners

                            By Fred A. Pope

                         Revised June 12, 2008

    In the Kentucky Derby, the brave filly Eight Belles became 
classic-placed and then a few minutes later was put down on 
national television. Every breakdown hurts, however the 
Kentucky Derby is different. Throughout the world not just 
racing fans, but families, gather around televisions on the 
first Saturday in May. It is Thoroughbred racing's opportunity 
to connect. It is the special day.
    In my opinion, racing dodged a bullet on Derby day because 
had the filly gone down a few seconds earlier, under urging at 
full speed, we would have faced a problem on a different level. 
Horrific images of such a spill would have been burned into the 
memories of millions of people watching live and then replayed 
again and again. The risk is there every time the race is run.
    In 1987, Alysheba's near fall in the stretch of the Derby 
raised the question: ``How can we make Thoroughbred racing 
strong enough to withstand such a disastrous event?''
    Whether working on a political campaign or a brand of 
peanut butter, that's how marketing people think because we 
know bad things happen and you either build an image strong 
enough to handle it, or risk having your product disappear.
    The safety issue is being addressed; but, it isn't the 
reason our sport is in crisis and fixing it will not provide 
the answer to how can we make racing strong enough to insure 
its future.

                           The Public Gets It

    In the blame game, the industry knows the Derby breakdown 
is complicated. But the public takes a more direct view. The 
public knows racehorse owners are to blame. It is the racehorse 
owners' game and they are responsible for their horses. That's 
the way the world works. The public gets it.
    The problem is racehorse owners don't get it. Racehorse 
owners, against all reason, have given control of their sport 
over to the tracks and seem to take no responsibility for what 
happens to it. You can own a racehorse and your only 
responsibility is to pay the bills.
    We have a long list of national organizations, but nowhere 
among them is a national Racehorse Owners Association (ROA). 
Several national organizations say they speak for racehorse 
owners, however those organizations are actually controlled by 
breeders, tracks or trainers. It seems everyone in our industry 
wants to speak for racehorse owners, except racehorse owners.
    While there many stakeholders in the Thoroughbred industry, 
the racing segment has only two stakeholders: racehorse owners 
and track owners.
    Sports' marketing is successful when the players, or owners 
of the talent, acquire the rights of the facilities where they 
play, then package and present the sport to the public.
    Every sport operates that way except ours. In Thoroughbred 
racing, the owners of the talent (racehorse owners) give away 
their rights to the facility (racetrack) where they race.
    It is the structural flaw that dooms the sport. When people 
complain there is no one in charge, how could there be someone 
in charge? Think about it.
    At one time, the golf courses controlled professional golf 
tournaments. The golf courses jerked the players around the 
country for low purses and low attendance. Then the 
professional golfers engaged, pooled their rights and adopted 
the major league model for the PGA Tour. The PGA Tour then 
acquired the image rights of the golf courses and today it 
packages and presents a great schedule for high purses and high 
attendance. If, God forbid, a golf shot killed a person in one 
of their events, the PGA Tour will be strong enough to survive 
it.
    As many of you know, I am a proponent of racehorse owners 
forming a major league like the PGA Tour. Yes, a major league 
would do the things everyone wants for the sport of 
Thoroughbred racing. It would have someone in charge. It would 
have all rights pooled into the proven business model. It would 
grow the sport and make it strong. However, until that happens, 
there is an urgent need to engage racehorse owners right now.

                  How Can We Engage Racehorse Owners?

    Racehorse owners' purse money is a good place to start. 
This year about $540 million is leaking out of purse accounts 
that are funded by off-track wagers. To put that amount of 
money into perspective, $540 million is twice the money in all 
stakes races in North America. It is also double the annual 
prize money on the PGA Tour. A change in the off-track business 
model is needed now to stop this money from leaking out and 
racehorse owners must engage to change it.
    The fastest way to get racehorse owners to engage in the 
business is to change one word in the Interstate Horseracing 
Act (IHA) into two words. Currently under the law, simulcast 
approval requires ``horsemen'', which are defined in the law as 
owners and trainers. Changing from the term ``horsemen'' to 
``racehorse owners'' with no definition required will 
immediately engage racehorse owners in their own sport.
    When interstate simulcasting started in 1978, the approval 
of ``horsemen'' at the host track and at the receiving track 
was a pretty basic decision. Today, off-track distribution is a 
sophisticated business venturing far beyond the borders of 
tracks. It is doubtful anyone is going to say trainers are 
better than racehorse owners to make the complex business 
decisions needed today.
    A simple amendment to the IHA will engage racehorse owners, 
some might say bring them kicking and screaming, into the 
business of Thoroughbred racing. It is the racehorse owners' 
game and they have both the right and the responsibility for 
simulcast approval.

           Simulcasting Changed The Business Model Of Racing

    The business model for pari-mutuel wagering started with a 
deal between the two stakeholders: the tracks and the racehorse 
owners. With each stakeholder having a significant investment 
in putting on the show, they agreed to a 50-50 split of the 
after tax takeout from wagers. The 50-50 split of on-track 
wagers netted and equal 8% into the purse account and 8% to the 
host track putting on the show.
    The business model for on-track wagers has stayed the same; 
however, simulcasting changed the business model for off-track 
wagers. Simulcasting has grown from nothing to where about 90% 
of all racing handle is made off-track today.
    Each year as the percentage of handle from off-track 
wagering increases, the percentage of off-track wagers going 
into purses has decreased from 8% to about 4% today. Those 4 
percentage points matter.
    Why is this $540 million (4% of $13.5 billion) in off-track 
wagering leaking out of Thoroughbred purses? The culprit is an 
insane business scheme that the small tracks and resident 
horsemen devised, giving the lion's share of the money (18%) to 
``where the bet is made'', instead of ``where the show is 
produced'' (3%).
    A direct analogy to this off-track model would be if a 
convenience store took the lion's share of a lottery ticket 
sale because the store punched in the numbers and sold the 
ticket.
    In the real world, the Lottery organization pays the 
convenience stores only 5% for punching in the numbers and 
taking the Lottery ``bet''. (YouBet.com has said they can make 
a profit with just 5% of the off-track wager.) If racehorse 
owners change to a business model where the bet takers receive 
5% for taking off-track wagers, there will be little or no 
leakage of racehorse owners' purse money.
    Before simulcasting, each track lived and died based upon 
its ability to put on a good show and attract a large crowd of 
bettors. The transient racehorse owners were drawn to the 
tracks with rich purses derived from the 50-50 split from 
wagers. The bigger markets delivered high attendance and with 
the high purses they offered, the largest number of people got 
to see the best horses race. It is a business model that makes 
sense and it worked well for the sport.
    The introduction of simulcasting in 1978 could have taken 
Thoroughbred racing to the next level by dramatically 
increasing distribution of our best racing products. Purses at 
the tracks putting on the show in our biggest markets would 
have soared to heights unimaginable today. That's the way the 
world works and it could have worked that way for Thoroughbred 
racing.
    When simulcasting started, ``where the bet was made'' was 
either at a host track or a receiving track. The receiving 
tracks and horsemen seemed to have the philosophy ``we own our 
customers and if they are going to bet on races at other 
tracks, we are going to get the lion's share from their bets''. 
While that was true in the beginning, the Internet and mobile 
technology has shown us no one owns the consumer today. 
Consumers today are free and mobile.
    There is a need to pay taxes to the state where the bet is 
made and just like purchases made on the Internet, we can 
continue paying the state their tax on the bet. All the while, 
we can be changing to an off-track business model that gives 
the lion's share ``where the show is produced''.

             ``Where The Bet Is Made'' Is Killing The Sport

    The tracks and horsemen are so addicted to the large margin 
they make on imported races (about 18%, versus the 3% going to 
the host track) that it has blinded them to the amount leaking 
out of the sport through other bet takers. The only way to 
bring change is for racehorse owners to engage in the business 
and establish a new off-track model that will allow the host 
track to make a profit and ensure a fair amount goes into 
purses.
    It isn't just the money, it is the most basic question for 
racehorse owners: Are we in the business of putting on a racing 
show, or are we in the business of making money on someone 
else's show? Trying to have it both ways isn't working.
    Racehorse owners, by not engaging, have put the tracks into 
the position of planning for a future where there is no 
incentive to grow live racing and the sport. The current 
incentive is for the tracks to convert into facilities where 
the live racing show is subservient to betting on other 
racetracks' races and other gambling, i.e. the new Gulfstream 
Park.
    Today, one of the tracks benefiting the most from ``where 
the bet is made'' is Keeneland, with only 30 days of live 
racing, but 11 months of taking the lion's share from imported 
races. This allows their limited live race days to benefit with 
large purses, but as much as we like Keeneland racing, is that 
what we want? Do we want our national sport to be downsized to 
a few weeks of festival racing?
    Keeneland is not to blame for the off-track business model 
and they have tried many times to raise the off-track price on 
their quality races. But, as we dig deeper into this mess, it 
is clear that the current model rewards the tracks with the 
least live racing.
    I favor a Major League structure within the sport of 
Thoroughbred racing. However, we also need a strong program of 
minor league racing, a feeder-system if you will. We need to 
continue having 35,000 foals born each year to give us the best 
6,000 to race at the highest level.
    Legal gambling makes lower levels of Thoroughbred racing 
economically viable, but the lower levels are not viable as a 
sport. Every sport has found they need a major league structure 
to package and present the highest level of their sport as the 
beacon that connects with the public.

            Breeders Should Urge Racehorse Owners To Engage

    Although commercial breeders are not one of the two 
stakeholders in the racing segment, they have great interest in 
the sport. Breeders should be very concerned about the $540 
million dollars leaking out of purses, because racehorse owners 
wanting to purchase new racing prospects could reinvest a good 
percentage of that money. Today, none of the money leaking out 
of purses is being reinvested in horses.
    With the incentives for the tracks changing away from live 
racing, inevitably tracks will discontinue live racing. They 
can make more money taking bets on other tracks races, so the 
live sport will become more and more regional.
    We still have great facilities in our major markets and it 
is vitally important to restore a business model that will 
allow them to not just survive, but to prosper.
    At this year's Belmont Stakes, the once-a-year crowd of 
94,000 people overwhelmed the water system. In America's 
biggest market, a track built to handle large attendance has 
been brought to its knees by the current off-track model. 
Restoring a business model that favors ``where the show is 
produced'' will restore our major tracks and the sport.
    Giving the majority to ``where the bet is made'' is a 
distribution model gone crazy and it has done its damage in 
just twenty-five years. It has allowed gimmicks such as 
``source market fees'', to leak purse money when there is no 
track in the state where the bet is made. As tracks start 
closing, more and more of the erroneous ``source market fees'' 
will be leaked from purses. ``Source market fees'' must be 
stopped and the term ``source market'' should once again come 
to mean the source of the live racing show.
    If a state such as New Jersey has passed legislation that 
prohibits paying a host track in another state more than 3%, 
then the racehorse owners should not approve their races being 
sent into that state until such laws are changed.
    Gross handle means nothing to racehorse owners and the 
sport if those wagers are not contributing enough to put on the 
live racing show. By instituting a fair off-track business 
model, racing could see the annual gross handle drop from $15 
billion to $12 billion, and still have more money going to 
support purses and host tracks. Isn't that what is important?

                          How Did This Happen?

    Just after simulcasting started, a war developed between 
the big tracks that were ``net exporters'' of races and the 
small tracks that were ``net importers''. The net importers 
were those tracks making more net money from their customers 
wagers on races ``imported'' from other tracks, than they were 
making from the bets made off-track on their exported live 
races.
    The big ``net exporters'' were tracks in New York and 
California. Those were the tracks with high purses and high 
attendance benefiting from large population centers.
    Soon the insane business model giving the lion's share to 
``where the bet was made'' brought the California and New York 
tracks to their knees. Purses dropped, horses left, and 
attendance fell off at our major tracks. Suddenly, the world 
was upside down and with racehorse owners on the sidelines, 
there was no one to correct the problem.
    Racing's business model was changing and the small tracks 
and the new gambling ``racinos'' started pulling horses away 
from our major markets to remote rural facilities, such as Iowa 
and West Virginia. The little guys were winning and our most 
successful host tracks were losing. The problem is when the 
best tracks in the major markets are losing; the national sport 
of Thoroughbred racing is losing. No one seemed to care.
    In 1992, I wrote an article called ``Whose Game Is It?'' 
and for a time racehorse owners started to engage. Later that 
year, Ed Friendly resigned from the California HBPA Board and 
with Mace Segal and other friends started Thoroughbred Owners 
of California (TOC). Soon they successfully changed California 
law to mandate TOC as the rightful organization to represent 
racehorse owners for simulcast approval. Funding was provided 
for the HBPA to continue their role with backstretch issues.
    The following year, Don Rudder and friends started 
Thoroughbred Owners of Florida (TOF) to do the same thing in 
that state. Just when it looked like we were going to engage 
racehorse owners, a strange thing happened. Commercial breeders 
in Florida and Kentucky convinced the leading racehorse owners 
who had signed up to start the TOF, to quit and as quick as it 
started, that was the end of the racehorse owners' movement. No 
other state racehorse owners' organizations were started.
    The TOC represents every racehorse owner who starts a horse 
in California and they have done a fine job, however the TOC is 
powerless to change the current business model alone. The 
Interstate Horseracing Act (IHA) empowers and requires approval 
from the horsemen at receiving tracks in other states and they 
looked at California as the enemy.
    By amending the IHA to rightfully empower racehorse owners 
across the country by law, we can avoid the state-by-state turf 
battles between breeders, trainers and racehorse owners. The 
structure in California is a good model. Each group--racehorse 
owners, tracks, trainers, jockeys and breeders--have a distinct 
organization. In other words, when they sit down to do 
business, they are not wearing more than one hat in California.
    Today, with the current off-track business model, it has 
evolved to where there are no more ``net exporting'' tracks. 
Think about what that means to our sport. With the host track 
receiving only half (one-and-a-half of the three percent) from 
off-track wagers, incentives to put on a good live show are 
gone. The host tracks cannot even afford to market their own 
races, so declining attendance at live racing and declining 
interest in the sport should not be a surprise.
    The consumer research I have seen shows that the majority 
of the generation born since simulcasting started in 1978 does 
not have a favorable opinion of Thoroughbred racing.
    We are losing the majority of a generation because we do 
not have a structure to protect and grow the sport.
    Is it any wonder the tracks and horsemen are at each 
other's throats? They are literally picking at the bones and 
trying to establish new businesses to go after the $540 million 
leaking out of racing because of the insane model of the lion's 
share going to ``where the bet is made''.
    Currently the horsemen's groups are fighting with account 
wagering companies to start putting more into purses. But, the 
amount they are asking from account wagers ($30 to $40 million) 
pales in comparison to the $540 million leaking from the system 
because of the basic problem of ``where the bet is made''. 
Unfortunately, the horsemen have no appetite to change from the 
business model that favors ``where the bet is made''. The 
original simulcast business model was a form of welfare for the 
small tracks that got out of hand.
    How can we stop leaking $540 million this year and assure a 
fair amount of all wagers on a host track's races go into its 
purse account? We simply change the off-track business model 
from a buyers' market over to a sellers' market, where the 
lion's share will go to the host track and racehorse owners 
putting on the show.
    By engaging racehorse owners, we will start to have 
businessmen and businesswomen who understand the business model 
of the past twenty-five years is wrong. The host track and 
racehorse owners must control their product and its 
distribution. That is one of the most basic principals of 
business.

                        A Better Business Model

    If racehorse owners develop a two-tier pricing model at the 
host track, we can continue a favored distribution system 
through other racetracks, while closing the leakage that occurs 
with other bet takers, such as account wagering companies and 
outlets with no live racing. Every phase of the distribution 
system must start contributing a fair amount to producing the 
show.
    The first tier could be changing to an off-track model 
similar to the one the Breeders' Cup uses, where half of the 
takeout goes to the host track and the other half to the 
receiving track. That should keep about 8% in purse accounts 
when tracks trade signals.
    The second tier-pricing model for other bet takers should 
start with a license fee of close to 8% going into purses at 
the host track. Exotic wagers have increased the total takeout 
to about 21% today, thus with a 5% commission paid to the off-
track bet takers, the host track would receive about 8% for its 
role in putting on the show.
    So, with about 8% going into purses, regardless of whether 
the bets were made on-track or off-track, each track will be on 
a level playing field for the first time. That's the model we 
should have had in place from the beginning. It is a model we 
can have in place soon.
    When this change occurs, we may lose some distribution as 
off-track buyers adjust. If some current outlets are lost along 
the way, technology will allow bettors to continue wagering 
with the host tracks.
    Why do you need 8% going to purses? Say you project the 
off-track handle on one day at the host track will be $5 
million. That would deliver $400,000 to purses. Combining that 
with projected on-track handle of say $500,000 at 8% ($40,000), 
the purse account would get $440,000, or enough for 9 races 
averaging $40,000 each. Not bad, but less than it costs for 
racehorse owners to keep the horses in the game.
    Under the current model, the purse account would only get 1 
1/2 % of that $5 million in off-track handle on its races, or 
$75,000, plus the on-track contribution of $40,000, for a total 
of $115,000. Then the purse account and host track would be 
dependent on whatever came in from bets on other tracks' races. 
The track and racehorse owners do not have control over their 
own destiny under the current off-track model.

                  The Incentive To Produce A Good Show

    What happens if the host track starts producing a good 
show? In a model where the host track purse account would get a 
fair 8% from the off-track handle on its races, if the host 
track can put on and market a good show and the off-track 
handle goes up to $10 million, then the purse account would get 
$800,000. Combining that $800,000 with $40,000 from on-track, 
would give you $840,000, or 9 races averaging $93,333. That's 
the incentive needed for putting on a good show. In addition, 
the host track and purse account would get 3 to 4% of wagers 
made on imported races.
    Also, under the current off-track pricing model there is no 
incentive for the host track to market its races. Currently, 
the host track has more incentive to market other tracks' races 
to their simulcast customers, than to market their own races. 
Not surprisingly, there are a lot of people scrambling to come 
up with a new business to go after the $540 million being 
leaked out of purses.
    Who will lose when the leaking is stopped? The only people 
who will lose when the offtrack business model is changed are 
those not involved in live racing. If any entity involved in 
live racing loses under the change, then they were doing 
something they should not have been doing. TrackNet, a joint 
venture of Churchill Downs and Magna Entertainment, wants the 
account wagering companies (ADW's) it owns to pay 7% to host 
tracks (3 + % to purses), then a wild mix of ``source market 
fees'' and 2% to 3% of handle to the television company they 
own. For areas of the country without a track nearby, all the 
rest of the money goes to TrackNet. That means the purse 
account at the host track would only get 3 + %, but their 
``partner'' host track could get upwards of 15%. That doesn't 
seem to fit the agreed upon split of 50-50 does it?
    Churchill Downs and Magna Entertainment own the television 
company, HRTV, jointly. They want it funded by a percentage of 
handle, 2 to 3%. Under such a model, HRTV would either be 
underpaid or overpaid. Television production is a fixed expense 
and should be paid a set amount. It would be good for the host 
tracks to sit down with their partners, the racehorse owners, 
and agree on the value of television production and how it can 
be funded properly to grow the business and the sport. It is 
not good business to fund television production with a 
percentage of handle.
    If racehorse owners will engage now in the business side of 
running the sport, we can then hope it will spill over into 
other issues like safety of the participants and a host of 
other issues. With a national racehorse owners' organization, 
they can decide how best to protect and grow the sport at every 
level. It's their game.
    Over the years, I have commissioned a great deal of 
consumer research on Thoroughbred racing. I can assure everyone 
there is a clear path for Thoroughbred racing to restore itself 
as a successful, national sport. But, it cannot be done without 
putting in place a business model that provides an incentive to 
put on the live racing show. The process starts when racehorse 
owners engage, fix this obvious problem and take responsibility 
for their game.
    The nature of an action sport like Thoroughbred racing 
means bad things are going to happen from time to time. We need 
to make our sport strong enough to overcome problems.
    I like the word ``engage'' as it applies to racehorse 
owners. It brings to mind the movie Top Gun. The crisis in the 
movie came when the lead character, Maverick, would not engage 
to protect his partner and his lack of commitment was putting 
his carrier ship in danger. When Maverick overcame his fears, 
took responsibility and engaged, his partner was saved, the 
ship was saved and the story had a happy ending.We need some 
racehorse owners with a little maverick in them to engage now 
and save the sport of Thoroughbred racing.
     2008, Fred A. Pope
                              ----------                              

    Ms. Schakowsky. Thank you.
    We are going to move to the question period. And be assured 
that many of you all will have an opportunity to expand on your 
remarks during that time.
    I am going to first ask 5 minutes of questions.
    I am going to do just a quick ``yes'' or ``no'' throughout 
the entirely panel to make sure we have it clearly on the 
record. Do you believe horse racing should be governed by a 
central body similar to the National Football League or the 
Professional Golfers Association or similar to the way horse 
racing is governed by a central body in Great Britain?
    Let's start with Mr. Marzelli.
    Mr. Marzelli. Industry-led, yes. Federally, Federal 
oversight, no.
    Ms. Schakowsky. That is a good division, too. You can say 
that.
    Mr. Shapiro?
    Mr. Shapiro. I absolutely believe that there needs to be a 
central governance body.
    Ms. Schakowsky. Mr. Van Berg?
    Mr. Van Berg. I believe the same thing. There needs to be a 
central governing body to make them all alike.
    Ms. Schakowsky. Mr. Moss?
    Mr. Moss. Yes.
    Ms. Schakowsky. Mr. Hancock?
    Mr. Hancock. Yes.
    Ms. Schakowsky. And Mr. Jackson?
    Mr. Jackson. Yes, but I think you ought to give industry a 
chance, and if they don't step up, you better step in.
    Ms. Schakowsky. Do you believe that the benefits of the 
Interstate Horse Racing Act should be conditioned, as was 
mentioned earlier, on racing jurisdictions adopting strict, 
well-understood medication and drug guidelines, stiff 
penalties? I guess we are really talking about simulcast.
    Mr. Marzelli. No.
    Mr. Shapiro. As a last resort, yes.
    Mr. Van Berg. I believe yes, with no medication whatsoever. 
Zero.
    Mr. Moss. As an outside observer looking into the industry, 
I can't think of any other stick that would work. So my answer 
would be a conditional yes.
    Mr. Hancock. Yes, ma'am. I think that is the only thing we 
can do to get it right.
    Mr. Jackson. I am a firm yes, unless something happens 
quickly by the industry.
    Ms. Schakowsky. Do you believe breeding should be regulated 
in the United States the way it is in other racing 
jurisdictions overseas, Mr. Marzelli?
    Mr. Marzelli. I am not sure I understand the question.
    Ms. Schakowsky. In Germany they regulate how breeding is 
conducted, et cetera.
    Mr. Marzelli. There is not one----
    Ms. Schakowsky. For soundness.
    Mr. Marzelli. I am sorry to not give a yes or no, but there 
is not one of the 64 recognized stud books that imposes 
restrictions. Germany has incentives, the way many of our 
States have breeders incentives. So I guess the answer would be 
I still am not sure of the question.
    Ms. Schakowsky. OK, you know what? I am going to move on 
then, if that question is somewhat unclear.
    Let me ask this. Should all performance-enhancing drugs, 
including steroids, all of them be eliminated?
    Mr. Marzelli. Yes.
    Mr. Shapiro. Without question, yes.
    Mr. Van Berg. Yes.
    Mr. Moss. Not just performance-enhancing drugs, all drugs, 
period. Yes.
    Mr. Hancock. Yes.
    Mr. Jackson. Yes, a firm yes, including anything that 
alters the appearance of a horse at a sale, as well.
    Ms. Schakowsky. OK.
    Mr. Marzelli, I wanted to ask you, you heard very clearly 
from Mr. Hancock and Mr. Jackson and all the rest concerns 
about whether or not the current regimen is really capable of 
making the kinds of changes that are needed. And yet you 
expressed a certain confidence that the new safety committee 
that says that certain drugs anyway should be eliminated would 
be swiftly adopted.
    What I hear from the body of the rest of the testimony is 
that these kinds of efforts have been unsuccessful in the past. 
Why do you think it would succeed this time?
    Mr. Marzelli. Well, for starters, I am an optimist. And if 
you are not, in this business, you need to find something else 
to do.
    Ms. Schakowsky. Based on?
    Mr. Marzelli. I am just an optimist at heart.
    We certainly make it difficult on ourselves. The 38 
jurisdictions in which we have to go to to achieve uniformity 
is not efficient. There is no question of that. But I guess it 
was about 20 years ago when Rupert Murdoch bought the Daily 
Racing Forum from Walter Annenberg, the industry got very, very 
concerned, certainly not at the magnitude we are concerned with 
now.
    Nobody said the industry could achieve what we have 
achieved today--that is, an industry-owned database of racing 
information, resting that control away from what was then a 90-
year-old third-party publisher monopoly. We did that; we got 
industry consensus to achieve it. And today the Daily Racing 
Forum is not only Equibase's biggest customer, but they operate 
in a virtual enterprise with us.
    I would like to think we are at that same kind of 
crossroads today. I have seen a lot of support for our 
recommendations, not only since Tuesday but since we announced 
the formation of this committee. And I would like to see if we 
are able to get those----
    Ms. Schakowsky. I am sympathizing right now with the 
witnesses because I have run out of time. And so I will ask Mr. 
Whitfield.
    Mr. Whitfield. Thank you.
    And thank you all for your testimony. We appreciate that 
very much.
    Mr. Marzelli, back in 1980, legislation was introduced at 
the Federal level to create uniform drug rule. And the industry 
came to Congress. Senator Mathias and Senator Pryor of Arkansas 
induced it. And the industry came and said, ``It is not 
necessary. We can adopt a uniform rule.'' We are 28 years 
later, and it still has not been done.
    Now, the question I have for you is this. You all formed a 
committee after Eight Belles went down, which was commendable. 
And I read the other day, as you mentioned, you all have come 
down with certain recommendations: banning steroids, toe grabs 
and so forth, and something relating to the whip.
    My question is, do you have the power to put this into 
effect around the country?
    Mr. Marzelli. No. We have the power of persuasion and 
consensus-building.
    Mr. Whitfield. And I think that your record would reflect 
that you do not have even that power. We are 28 years later, 
and still very little progress has been made. Now, I know that 
they talk about there is a uniform rule adopted by various 
jurisdictions in the 38, but each one of those rules is 
different. And I notice in Louisiana, for example, they adopted 
a uniform rule and then the legislature reversed it down there.
    So I would suggest that I think it has been clearly 
demonstrated over all these years that The Jockey Club, the 
NTRA do not have the authority. I mean, the NTRA is a marketing 
agent. You can do all you want to about consensus and so forth.
    But the question I would have for you is, if we can use the 
Interstate Horse Racing Act, which provides this industry with 
the revenue that it needs, 90 percent of the revenue--and the 
industry asked for it--and if we can set minimum standards that 
would make it mandatory that jurisdictions ban steroids, ban 
toe grabs, it is accomplishing what you want, why would you 
oppose that?
    Mr. Marzelli. I would like to see the industry regulate 
itself.
    Mr. Whitfield. Now, Mr. Van Berg, you are a hall-of-fame 
trainer. It is my understanding that you won more races than 
any living trainer. Is that correct?
    Mr. Van Berg. That is correct.
    Is this on now?
    Ms. Schakowsky. Yes.
    Mr. Whitfield. Is drug use as widespread as it appears to 
be?
    Mr. Van Berg. I will put it mildly or put it to the point: 
It is like chemical warfare. I will just put it straight out to 
you. It has got, as far as I am concerned, plum out of hand.
    Mr. Whitfield. Why are people using these drugs? I mean, if 
a horse can run on natural ability, why would they be pumping 
them up with all of these drugs?
    Mr. Van Berg. Why do these people that have been in the 
Olympics, now finding out that they used steroids, they used 
EPO, which is an enhancer for your blood to build your blood up 
and those things, and they are finding out now, and they are 
taking their medals away from them.
    I have an article I showed the rest of them about this girl 
that was the fastest girl in the country, that admitted finally 
now she was on EPO and steroids and what it did to her as far 
as the female part. And, in the horse business, you know, it is 
like keeping up with the McCoys.
    Mr. Whitfield. And if a horse on its own natural ability 
has a pain, he's not going to run, but if he can shoot 
something in there----
    Mr. Van Berg. They can overcome that. And it is the same as 
Clenbuterol.
    Mr. Whitfield. Mr. Jackson--this time gets to us, doesn't 
it?
    Ms. Schakowsky. Right.
    Mr. Whitfield. Mr. Jackson, I read your testimony, and you 
had included an article written by Fred Pope----
    Mr. Jackson. Yes.
    Mr. Whitfield [continuing]. And about amending the 
Interstate Horse Racing Act. Here is the question I want to ask 
you: when the HBPA comes and testifies in Congress, they say 
that they represent all the owners and all the trainers. And I 
would like to ask you----
    Mr. Jackson. When who comes in?
    Mr. Whitfield. The HBPA. Do you pay any dues to the HBPA?
    Mr. Jackson. Not that I am aware of.
    Mr. Whitfield. Mr. Hancock, do you play any dues to the 
HBPA?
    Mr. Hancock. No.
    Mr. Whitfield. Well, the reason that they are designated in 
the Interstate Horse Racing Act, they are the ones that 
primarily wrote the Interstate Horse Racing Act, and that is 
how they became designated as the ones that approved the 
simulcast contract.
    Mr. Jackson. A lot of organizations, Representative 
Whitfield, pretend to represent the owners, and they don't.
    Mr. Whitfield. Who are the stakeholders in racing today?
    Mr. Jackson. The owners. We pour $4 billion a year, over $4 
billion, $4.3 billion, into the industry for racing and 
training horses, and we get $1.1 billion back. The owners are 
the lifeblood of the industry, the new people coming in. But 
what happens is the organizations maintain control in their 
fiefdom and we can't alter the change.
    Mr. Whitfield. So the owners and the racetracks are the 
real stakeholders, I am assuming?
    Mr. Jackson. Well, actually, central Kentucky breeders and 
the racetracks are the primary voices that exclude the owners 
and the horse itself.
    Mr. Whitfield. OK.
    I guess my time has expired.
    Ms. Schakowsky. Mr. Stearns?
    Mr. Stearns. Thank you, Madam Chairwoman.
    Well, I can see why Mr. Dutrow perhaps didn't show up. This 
is a staggering amount of information to hear from you folks.
    Steroids in horse racing is widespread--Mr. Shapiro. We 
even heard that Mr. Jackson says he doesn't want to buy horses 
in Florida or any other State in the Union because there is so 
much inbreeding. So he goes to Argentina and Germany to buy 
horses and not the United States. That is a telling comment, I 
would think. And I would think, Mr. Marzelli, that that would 
be a very disturbing comment, that there is so much inbreeding 
in the United States that he doesn't feel comfortable, with all 
of his experience in horse racing.
    So my question for you is, the Jockey Club places all sorts 
of restrictions on thoroughbreds in order to qualify to be 
registered. For instance, your organization lists extensive 
rules on how a horse can be named. Isn't that true?
    Mr. Marzelli. That is true, subsequent to registration.
    Mr. Stearns. You also won't register a horse that was a 
product of artificial insemination. Is that true?
    Mr. Marzelli. True.
    Mr. Stearns. Why won't your organization put similar rules 
for sound breeding principles in place?
    Mr. Marzelli. Because we believe they would be selective 
and arbitrary.
    Mr. Stearns. And the fact that Mr. Jackson says he won't 
even buy a horse in the United States, doesn't that concern 
you? Wouldn't you think would have to put some sound breeding 
principles in place?
    Mr. Marzelli. It concerns me that Mr. Jackson says that, 
but the fact is that the number of exports that left North 
America in the last 5 years have increased by 27 percent. There 
is still a great demand for a North American bloodlines around 
the world.
    Mr. Stearns. Mr. Jackson, you are welcome to reply.
    Mr. Jackson. The Jockey Club is a fiefdom, one of the many. 
And it does a good job of making recommendations; it has no 
power to execute those recommendations. We need a national 
organization with the strength of the owners backed to get any 
change.
    Mr. Stearns. Mr. Moss, you indicated that there are 38 
racing commissions and they are all Nero-like CEOs. I think 
that was your statement. Is that correct?
    Mr. Moss. Yes, sir.
    Mr. Stearns. Is The Jockey Club one of those Nero-like 
organizations?
    Mr. Moss. Well, I am a member of The Jockey Club, and it is 
great for what it does, but it has no way to control the rest 
of the industry. None of us do, none of these fiefdoms.
    Mr. Stearns. So it is not his fault; he just doesn't have 
the authority.
    Mr. Moss. That is right. That is right.
    Mr. Stearns. He has responsibility with no authority.
    Mr. Hancock. That is right, yes, sir.
    Mr. Stearns. Mr. Marzelli, why not put some hard and fast 
rules on only 4-by-4 inbreeding, on only horses that have never 
been on steroids?
    Mr. Marzelli. Once again, we are a member of the 
International Stud Book Committee, and we subscribe to the 
international definition of the ``thoroughbred,'' which does 
not impose selective and arbitrary measures or attributes in 
what constitutes a thoroughbred.
    If we impose selective and arbitrary attributes, we not 
only would open ourselves up to criticism that we were being 
selective, but we would prohibit or restrict trade around the 
world, because our definition of a thoroughbred would differ 
from the rest of the world.
    Mr. Stearns. Well, our drug rules differ, don't they?
    Mr. Marzelli. The drug rules differ on track. And I am not 
a fan of them, by the way.
    Mr. Stearns. OK.
    Mr. Marzelli. And I take a lot of heat when I travel 
internationally about them.
    Mr. Stearns. Mr. Jackson mentioned that the Interstate 
Horse Act, if we just changed two words, ``and trainer,'' that 
would go a long way. Do all of you agree with what he said?
    Is that correct, what you said?
    Mr. Jackson. Basically, yes. Although I am not pretending 
to give the Congress words.
    Mr. Stearns. No, no. I would say to the witnesses that 
there probably will be a bill after the second hearing, and 
this bill will probably, might even be sunset to help you get 
started with a national horse racing commission. I had a bill 
to do this with the boxing commission, and I had it sunset. It 
was my bill in the House and Senator McCain in the Senate. And 
it was defeated on the House floor. It passed overwhelmingly in 
the subcommittee and the full committee, but it was defeated in 
the House. But I would suspect that some kind of bill that 
perhaps would sunset would help you get started on this.
    But my question is, and ask each of you if you agree with 
Mr. Jackson, just deleting the words ``and trainer'' as a step 
for this committee is a good idea.
    Mr. Marzelli. I would like to see the text before I 
comment.
    Mr. Stearns. All he is saying is delete two words.
    Mr. Marzelli. Which are?
    Mr. Stearns. ``And trainer'' from the act.
    Mr. Marzelli. I----
    Mr. Stearns. I guess you are not familiar enough with it.
    Mr. Marzelli. No.
    Mr. Whitfield. Instead of ``horsemen's group,'' it would 
say ``horse owner.''
    Mr. Stearns. Yes, good point.
    Mr. Shapiro. I appreciate Mr. Jackson's perspective, but I 
think it is really superfluous to what the act needs to be 
revised to really make fundamental change and create central 
governance, which I believe is the goal of what Mr. Jackson and 
what all of us believe. And, therefore, I think----
    Mr. Stearns. We are all struggling to understand your 
issue, and we are asking for your help on what to do. Soif you 
don't know, you can say you don't know. So I am just asking if 
you agree with him.
    Mr. Shapiro. I don't know that I agree with that particular 
part, but we are certainly late in getting out of the starting 
gate to create a central body of governance, which this 
industry sorely needs.
    Mr. Stearns. OK.
    Quickly, Mr. Van Berg?
    Mr. Van Berg. I would say I don't know that much about it, 
but I think that, as far as you are talking about the breeding 
and stuff, you need a central governor.
    And if you stop all medications, zero of anything, that 
will eliminate the unsound horses themselves. They will 
eliminate themselves. I don't think you can sit here and talk 
toe grabs and whatnot. You need to eliminate the medication, 
zero. The unsoundness of horses will eliminate themselves and 
make your racetracks deep enough where speed is not the thing.
    Mr. Stearns. Mr. Moss?
    Mr. Moss. I seldom pass up a chance to give an opinion, 
but, in this particular situation, I am not that familiar with 
the subtle nuances of the language of the Interstate Horse 
Racing Act. So I would have to give you an ``I don't know'' 
there.
    Mr. Stearns. Mr. Hancock?
    Mr. Hancock. Yes, sir. Well, I think the Army needs a 
general. I mean, we have a lot of great organizations, but, as 
I say, they are scattered and not organized and oppose one 
another. And so I just think the Army needs a general. Does 
that answer your question?
    Mr. Stearns. Sort of.
    I yield back my time.
    Mr. Jackson. On that one point, I just wanted to eliminate 
the impression that just that would be all we might be asking.
    Mr. Stearns. No, no, but as a start.
    Mr. Jackson. Yes, as a start, I think it will encourage or 
embolden the owners to organize and bring their respective 
States together to a national organization. And then if it 
didn't, then I think Congress should----
    Mr. Stearns. Yeah, give the owners the authority they need.
    Thank you, Chairwoman.
    Ms. Schakowsky. There are four votes right now that the 
members are going to have to go down to the floor for. We will 
resume right after that.
    I am not going to be able, I don't think, to come back 
until later, so someone else will be in the Chair. But I want 
to thank all the witnesses. And please wait, and we will 
complete this round of questioning.
    Thank you very much.
    [Recess.]
    Ms. Schakowsky. If everyone could take their seats so we 
can resume.
    We will resume the questioning now with Mr. Pitts.
    Mr. Pitts. Thank you, Madam Chairman.
    Mr. Marzelli, in your testimony, you talk about the 
importance of uniform rules, both domestically and 
internationally, with regard to breeding. Do you believe that a 
uniform set of rules should also govern the use of medications?
    Mr. Marzelli. Yes.
    Mr. Pitts. Should there be a ban on steroids and other 
medications? If so, which ones?
    Mr. Marzelli. We are moving to a ban on anabolic steroids. 
Eleven of 38 States have already put in place regulations to 
ban those steroids on race day. And we hope that the remaining 
jurisdiction will do so by the end of the year.
    Mr. Pitts. In March, Curlin won the Dubai World Cup in the 
United Arab Emirates, but there are different rules that govern 
the sport there. Does The Jockey Club have a position on this 
inconsistency? If other countries can have zero tolerance, what 
is holding us back from adopting the same stance?
    Mr. Marzelli. The Jockey Club has a long history of being 
anti-medication. We have engaged ourselves in a number of 
industry initiatives, from the racing medication testing 
program, the quality assurance program, the Equine Drug 
Research Institute. And in every one of those industry 
organizations, we have advocated a strong--I wouldn't go so far 
as to say a ``hay, oats and water'' mentality, but a as-close-
to-zero-tolerance-as-possible mentality, distinguishing between 
performance-enhancing and therapeutic.
    Mr. Pitts. So what is the difference between banning race-
day medications and banning steroids during training? Would 
there be a difference in approach to training situations?
    Mr. Marzelli. Actually, the recommendation we came out with 
is an effective ban on race day and training.
    Mr. Pitts. Both. OK, thank you.
    Mr. Shapiro, in your observations, what do you believe the 
most fundamental concern is, the pharmacological culture in 
horse racing today or the breeding practices?
    Mr. Shapiro. Oh, I think clearly it is the pharmacological 
issues that are hurting racing. I think that if you were to 
look at a graph of the number of starts per year of horses 
dating back to 1960 and you were to then look at when 
medications that were brought on board for therapeutic uses but 
used in fact in racing, I think you would see a direct 
correlation in the downward trend in the number of starts.
    I think that the root of the problem today is medication. 
And my fear is that, as medications are used in the breed and 
they are being bred into the breed, I think that what they are 
doing is they are masking infirmities and problems in the 
breed, and it is being perpetuated as the breeding continues.
    So I believe the Number 1 thing is medication. But 
overriding that is there has to be a central body to regulate 
it nationally. I am the only regulator here from this 
particular State. And our problem is that we are disadvantaged 
in California because we test more. And as we are more vigilant 
than other States, we are disadvantaged. And we need other 
States to join with us to rout out medication.
    Mr. Pitts. Currently for what violations does the NTRA 
primarily discipline members, and what are the penalties?
    Mr. Shapiro. Who are you asking the question to?
    Mr. Pitts. You.
    Mr. Shapiro. Me?
    Mr. Pitts. Yes.
    Mr. Shapiro. I am not aware of the NTRA doling out any 
penalties. I don't believe it is their job, or I don't believe 
that they are an enforcement agency. They are an agency to 
promote the industry and make recommendations, but I am not 
aware of their having any power to enforce the penalties.
    Mr. Pitts. Thank you.
    Mr. Van Berg, what kind of strict penalties do you 
envision? Suspension, a permanent ban, what type?
    Mr. Van Berg. Number one, you have to eliminate the 
medications, zero tolerance of anything, to eliminate it. That 
is where you have to start. The unsoundness of horses, they 
will eliminate themselves if you stop the medication where they 
can't bring them along.
    And then you have to make the penalty where they have to 
stand up and give them a severe penalty. Nowadays, if they have 
a bad test, they get a slap on the hand or make a little 
agreement that they won't have another one, and they just go on 
with it.
    And I think, for the welfare of the animal and the horse-
racing industry, they have to be on a level playing field. And 
you have to have somebody, a commissioner or whatever you need, 
to enforce the thing throughout all the States.
    Mr. Pitts. Do you support the idea of some kind of a 
national governing body for horse racing?
    Mr. Van Berg. I would support it as a commissioner so 
everybody has to be on the same level, yes, I support that, 
with the right kind of commissioner that knows what is going 
on.
    Mr. Pitts. Thank you.
    Mr. Moss, in your opinion, is it possible to reform within 
the NTRA, or do we need a completely new construct?
    Mr. Moss. The NTRA is populated with people who have the 
best interests of the sport in mind. There are a lot of bright, 
intelligent people at the helm of the NTRA.
    But the problem, as I see it, is that the NTRA and other 
agencies in thoroughbred racing have no teeth. They have no 
power to mandate any sort of meaningful changes in thoroughbred 
racing. And however that is accomplished, that is a path that, 
in my opinion, thoroughbred racing needs to go down.
    Mr. Pitts. In your opinion, what incentives under the 
current structure do the members of the NTRA have to adopt 
stricter standards?
    Mr. Moss. I think the public outcry over the Eight Belles 
incident, following the Barbaro incident, has really created a 
groundswell of support within the racing industry for change. I 
mean, keep in mind, as you probably know, this is an industry 
that has often been allergic to change. That is a positive 
sign. And I think the NTRA feels that it has a mandate within 
the industry to try to enact change whenever possible.
    But in the end, when you look at the Thoroughbred Safety 
Committee's recommendations the other day, which were 
admirable, which were very good, you look at the response of 
all the industry leaders, they use words like, ``we support,'' 
``we strongly support,'' ``we urge.'' There is no requirement, 
there is no mandate there. They can only beg and plead, 
basically, the 38 different State jurisdictions to go along 
with these recommendation. And that is the problem that 
thoroughbred racing has, in my opinion.
    Ms. Schakowsky. Mr. Pitts, we are going to do another 
round.
    Mr. Pitts. Thank you. I will yield back.
    Ms. Schakowsky. Mr. Hancock, in your testimony you state 
that the veterinarians are running the show. Can you explain 
that?
    Mr. Hancock. Well, a couple years ago, I was at Keeneland, 
and I told the veterinarian that I didn't want my horses to get 
anything unless they were sick. And he said, ``Well, Arthur, 
you want to win races, don't you?'' And I said, well, sure. And 
I got the picture. Other horses are going to be getting 
anabolic steroids and Lasix and these performance enhancers. 
And I have my family's business in this, and I can't fight with 
my hands tied behind my back. So, you know.
    The veterinarians, like in Lexington, one of the bigger 
banks, the biggest accounts up there, the veterinary 
pharmaceuticals, they convince the trainers, who want to win of 
course, and then the trainers convince the owners. And I am an 
owner and I don't want to lose races. So I don't want to be at 
a disadvantage.
    It is just a vicious cycle. But if these drugs were banned, 
you know, you could eliminate all that.
    Ms. Schakowsky. But the veterinarians are making 
significant profits from this as well, are they not?
    Mr. Hancock. Very significant, yes, ma'am. I mean, vet 
bills can run $1,000 a month, or I have heard them running 
$2,000 a month.
    Ms. Schakowsky. And is that primarily because of the drugs?
    Mr. Hancock. Sure. I got out of Vanderbilt in 1965, and I 
worked the racetrack for a year until 1966. And the only time a 
veterinarian came around the barn was if the horse was sick or 
they came to check him for race day. And now veterinarians are 
now at the barns almost every day. I could show you the vet 
bills. I mean, they run $700, $800, $900, sometimes $1,700 a 
month.
    Ms. Schakowsky. Thank you.
    Mr. Moss, you come from ESPN and ABC Sports, so can you 
elaborate on your advocacy for a horse racing league similar to 
the NFL or PGA? What would that look like?
    Mr. Moss. What would it look like? Well, for starters, 
whether it be done with Federal mandates or however it be 
accomplished, it would have to be a regulatory agency with the 
power, perhaps, to take votes from the various State 
organizations, whatever, but the power to mandate significant 
changes for the best interest----
    Ms. Schakowsky. And what kind of sanctions would you 
envision that would make it possible to enforce such rules?
    Mr. Moss. The only potential sanction that I have heard 
discussed that would make any sense at all would be the 
sanction that some of you recommended about simulcasting 
rights. I can't think of any other stick that is out there that 
would work.
    Ms. Schakowsky. OK.
    Mr. Moss. Maybe there isn't one.
    Ms. Schakowsky. Does anybody else want to comment on what 
this national structure would look like?
    Yes, Mr. Van Berg?
    Mr. Van Berg. Well, the first and most important thing is 
to have the testing procedure funded where they can do the most 
sophisticated testing there is. So each State pays for their 
own testing. And some of them don't have enough money to test 
for everything they do, so they have to take some money from 
the simulcast, which I say there is plenty there for them to 
use, in a very minute percent, and have the most sophisticated 
testing there is. That is where you have to start.
    And then you have to have a commissioner to start to 
enforce the rules for each and every State so they are the 
same. And if somebody doesn't abide by the rules, then they go 
down the road. And it is just plain and simple, where they 
can't get a lawyer and take a thing--when you sign for your 
license, that is what you go by.
    But they have to have the testing, because a lot of 
testings are not right.
    Ms. Schakowsky. And you are suggesting that a funding 
mechanism for that could be a percentage of the simulcast?
    Mr. Van Berg. I would say, I just know from California, 
when they took a small, minute percent of the off-track 
stabling and banning stuff, and it was a very minute percent, 
and they had an abundance of money for banning the horses, 
stabling them at the racetracks, paying them to keep the track 
open and stuff. I just suggested in my testimony that one-
eighth of 1 percent would be a lot of money of all the 
simulcast, but have the best testing procedure there. It is 
like for the Olympics, they slowed them down and caught them, 
and made a big difference in them.
    Ms. Schakowsky. Thank you.
    I am going to turn it over to Mr. Whitfield.
    Mr. Whitfield. Thank you.
    Mr. Moss, let me ask you a question. You have been an 
observer of this industry for 30 years. You have been a 
reporter; you have followed it very closely.
    Given those observations, what, in your view, is the 
largest obstacle in the industry to go to uniform standards 
through some minimum standards at the Federal level? Why do 
some of these groups like The Jockey Club and others object to 
this so vehemently?
    Mr. Moss. That is a good question. I think there is 
probably, in a lot of areas, there is a fear of Federal 
involvement, the fear of a loss of control of their own 
destiny, of their own sport. I think----
    Mr. Whitfield. But it is so puzzling because if they make 
recommendations that we can help institute to accomplish their 
goal, then why would they object to it?
    Mr. Moss. That is a good question. I mean, I think what we 
have seen is that the difference--the fragmented way that the 
sport is being conducted right now is just simply not working.
    Mr. Whitfield. Mr. Van Berg, I get the impression in the 
horse-racing industry, unlike most--when people violate the 
rules and are suspended for drug violations, there is usually 
some stigma attached to it. Yet, in this industry, an Eclipse 
Award trainer can be given that award even though he has 
violated all sorts of rules. Why is that, in this particular 
industry?
    Mr. Van Berg. Well, because they tolerate it, is the best I 
can tell you. That is what I am talking about when they give 
them a slap on the hand and they get one infraction after 
another and nothing ever happens to them.
    And they go along and people come to the racetrack--a young 
man comes to the racetrack, and he has no reputation, nothing 
to lose. A young veterinarian comes out of school. And if they 
can collaborate something that makes the horses do better, the 
first thing you know, the guy is the leading trainer and the 
veterinarian has all the business. So it is just a snowballing 
effect.
    Mr. Whitfield. I have a letter that a vet wrote to one of 
his clients who had questioned the vet bill. And the vet 
stated, ``The vet's job is to work with the trainer to achieve 
whatever level of risk they desire.'' That is quite a 
statement.
    Mr. Van Berg. I can tell you this much, Mr. Whitfield, that 
a lot of people with a trainer's license, the veterinarians are 
mostly training horses. Because when you ride by the barn, the 
veterinarian is jogging them go out on the path, looking at 
them. When you ride back by them, they have their tray out and 
injecting them or whatever they need to do to them.
    And, to me, that is not a good horseman. If you don't know 
what is wrong with your horse yourself, you shouldn't have a 
trainer's license.
    Mr. Whitfield. I am going to go into another area.
    Mr. Hancock, in your testimony you mentioned that certain 
foals have surgery and yet, when they go to sale, no one is 
ever aware of it. Would you elaborate on that a little bit?
    Mr. Hancock. Yes. If a young foal is crooked, he doesn't 
have good conformation, you can have the veterinary procedures 
done called PEs or they have screws and wires they can put in 
the knees and things like that. And nobody ever hears about it. 
I mean, they go to the sale and----
    Mr. Whitfield. There is no requirement that it be 
disclosed?
    Mr. Hancock. No. And I recommended 15 or 20 years ago that 
that should be put on the registration papers, the foal papers, 
so we would have transparency.
    Mr. Whitfield. But that is not required.
    Mr. Hancock. And it didn't happen, no. It is money, you 
know.
    Mr. Whitfield. Mr. Jackson, I think you or someone 
testified about the importance of having medical records 
available for these horses.
    Mr. Jackson. Yes. We certainly are breeders and prospective 
buyers. In fact, the public itself and certainly the regulatory 
agencies, if any, and certainly the organization should have a 
full documentation of the trail of ownership, like you have on 
a used car, on a horse.
    Mr. Whitfield. Right.
    Mr. Jackson. And you need the medical records, as well.
    I was a member of this Sales Integrity Task Force recently, 
and I was the only one dissenting. I wanted mandatory records 
in what is called the depository at an auction, where any 
prospective buyer could go in and see what medical treatments, 
what surgeries, what drugs, the whole medical history of a 
horse, so that they could make an informed decision as to 
whether that horse had both natural running skills or breeding 
potential. I was the only dissenting voice in 40 members of 
that committee.
    Mr. Whitfield. Let me ask you another question. How 
widespread is this problem that you encountered where agents 
that you hired to buy horses for you were taking kickbacks from 
breeders that were selling the horse to you?
    Mr. Jackson. It is not as widespread as you might imagine, 
but it is too prevalent for the few that do it. And the 
industry hasn't paid as much attention to it as it should.
    Just recently, both auction houses, Fasig-Tipton and of 
course Keeneland, took action to try to solve the problem. But 
it takes a regulatory body with an investigative arm to ferret 
out where this happens to process the claims or suspicions or 
accusations. Then they also have to have a body to adjudicate 
that. And then they have to have an enforcement mechanism.
    The industry hasn't done that. They have taken baby steps 
instead of giant strides.
    Mr. Whitfield. Am I correct in saying that you hired an 
agent to buy horses for you, and the breeders were giving that 
agent kickbacks if he bought horses from----
    Mr. Jackson. Some breeders, and then other breeders 
overseas. It even got Byzantine. It went all the way through 
undisclosed Swiss banks, bank accounts in Belgium and France, 
certified accountants in Ireland, fictitious LLCs where money 
was transferred. You couldn't trace back to the owner what the 
history of a horse had been. And that allows people to be 
bribed.
    Ms. Schakowsky. Mr. Pitts?
    Mr. Pitts. Thank you, Madam Chair.
    Mr. Hancock, you listed the many different conflicting and 
overlapping organizations and associations in the industry. In 
your view, are there particular groups that have been an 
impediment to reforming the sport?
    Mr. Hancock. No, sir, I wouldn't say that, except that some 
of the groups--I think ego has a lot to do with it. They all 
envision themselves as the saviors of racing each respective 
group. They have their own CEO of the group and the members. 
And it is like some good people trying to pull a wagon, but 
they are all pulling in different directions.
    So I wouldn't say there is any particular one, but it is 
just everybody is pulling in a different direction. The Army 
has no general. That is the way I see it, sir.
    Mr. Pitts. Do you feel that a Federal racing commission of 
some sort is definitely the way to go? Do you believe that a 
private-sector organization, similar to the NFL or NBA, could 
perform this function?
    Mr. Hancock. No, sir, I don't. I wish that I thought that 
it could, but I have watched it for too many years. As I say, 
when Senator Mathias came up there, the industry came to 
Washington and said that we will get it in order and get it 
straight. But after hundreds of meetings and 28 years, nothing 
has happened. And there just doesn't seem to be an urgency.
    I think now, since you all have called this hearing, there 
is more urgency now, I think, than there ever has been. But I 
still don't hold any hope, because, as I say, everybody is 
pulling in a different direction. The train has no engineer. 
That is my view.
    Mr. Pitts. Thank you.
    Mr. Jackson, on the vet bills, your average vet bills, is 
that per horse each month or for the farm?
    Mr. Jackson. Well, the vet bills have gone--let me say 
this. Back in the late 1930s, early 1940s, Santa Anita 
racetrack when Seabiscuit was running had three veterinarians 
on hire by the track, and they took care of all the horses 
while there. Now, if you go to Santa Anita, I bet there are 26 
vets. The three used to drive Chevrolets. They all drive BMWs 
and Cadillacs now.
    There is a huge impact on racing, and the vet is impacted 
by convincing the trainers that if they want to win they can 
get this special thing this time and everybody else is doing 
it. So we have to stop it, stop it cold, zero tolerance.
    Mr. Pitts. What is your average vet bill a month?
    Mr. Jackson. I would guess, because of surgeries, as Mr. 
Hancock mentioned, wires and screws--I am learning the 
business. I am re-emerging into--it is like ``Alice in 
Wonderland.'' It has changed from the time when I was in it 
before to where it is now. Now I have bills for knees, special 
hoofs, special wires, special surgeries, special removal of 
chips, OCDs. I would guess it is in the $1,000 to $5,000 per 
horse per year. And it could be a lot more. I am talking about 
surgeries, not medicines or therapeutic medicinal things.
    Mr. Pitts. That is in addition.
    Mr. Jackson. In addition. And I am not talking about what 
they do generally to come out and help the birth of a foal or 
to make sure a mare is in comfort at foaling.
    Mr. Pitts. How do you, Mr. Jackson, suggest the industry or 
the governing body, if there were one, deal with off-track 
betting?
    Mr. Jackson. Off-track betting is the money that has 
mushroomed to be the largest segment of the potential handle, 
but it is escaping the track and the purse.
    The track and the owners have a common interest in 
elevating what used to be 20 percent, part of that went to the 
State or the city, maybe 3 or 4 or 5 percent, and they would 
split 80--8 percent, and the purse was 8 percent of the handle.
    Well, now the handle does not include whatever goes 
offshore. It only includes part, a very reduced percentage, 
maybe 2 or 3 percent, and it varies, of what goes into computer 
betting or betting shops in New York or on TV.
    You can bet so many ways now, and the fastest growing part 
of the revenue that is generated by the show, the horse at the 
track is going, I would say, off and out of the handle. And 
that percentage that used to be 8 percent, it is distorted now. 
The horse probably get 3 percent of the total handle. It is 
off-track.
    On-track we still have the same regimen. And there is 
plenty of money there, please, to fund the veterinary clinics 
we need, the analysis, the labs. There is plenty of money to 
fund all the rest of it. We just don't get it. It goes to the 
good old boy system on the breeding side, or it goes over to 
the betting parlors, or it gets maneuvered through the State on 
a disproportionate level.
    And why is that? Owners cannot be at the table to negotiate 
the percentage because the trainers are there. The IHA allows 
them to be there, and we are absent. We need a commissioner, we 
need a national organization, so that the owners can have a 
fairer return on their money.
    Mr. Pitts. I think I have time for one more question.
    You have suggested that making medical records more 
accessible would improve transparency and help breeders make 
better decisions. Are there issues of confidentiality that such 
a change would implicate? And, if so, how should 
confidentiality issues be dealt with?
    Mr. Jackson. I think that is a bogus argument. I am proud 
of the product I produce at Stonestreet. We put a headline on 
our catalog that we bred that horse and that we stand behind 
it.
    Confidentiality was explained to me by one breeder who 
argued that against our position in the Sales Integrity Task 
Force that, ``Oh, no, then we would have to tell our employees 
how much we are making.'' Oh, boy. That is not an excuse for 
having an informed buyer and an informed breeder be fully 
informed in order to make decisions to correct the wrongs that 
exist in the breeding system and in the racing system.
    Mr. Pitts. Thank you.
    Thank you, Madam Chair.
    Ms. Schakowsky. I am going to have--it is not all the time 
that we have these long-time--if we combine all your years in 
the business, it is probably quite a few. And so Mr. Whitfield 
has another question, and I am going to go ahead and have him 
ask it.
    Mr. Whitfield. Thank you, Madam Chairman.
    I am going to approach this from a little bit different 
perspective, and this won't take long. But there are certainly 
different levels of racing. There is the Churchill Downs, the 
Keenelands, the Saratogas, the big stakes races. And then there 
is racing at other tracks in which there are a lot of 
$2,000,$4,000 claiming races.
    And in those tracks, you frequently have horses--not 
frequently, but you do have horses sometimes who have won in 
their lifetime $500,000 or $600,000 and then end up in $2,000 
claiming races. And when they get down to that level, there is 
a lot of injection of corticosteroids and other things to keep 
them running.
    And I know there are volunteer organizations out there, 
like CANTER up in Michigan and in the middle Atlantic States. 
And their sole mission is to go to the racetracks and try to 
convince trainers for horses who obviously can't run anymore to 
let them try to retrain them for other uses. So the trainer, at 
that point, sometimes they will sell, sometimes they won't 
sell. Sometimes they will take them and let them go to 
slaughter.
    But I want to say that CANTER, up in Michigan, for example, 
in 1 year--they raised their money voluntarily; the industry is 
not paying for any of this--that they spent over $50,000 on 
surgeries for horses that they took off of the track. So that 
is kind of backside, the dirty side, of racing at a very low 
level.
    I know that some breeders like Mr. Hancock and Mr. Jackson 
and others have established humane equine centers up in 
Lexington, Kentucky, where they will euthanize horses who have 
reached the end of their racing career and they have serious 
problems and they can't do anything else.
    Mr. Marzelli, I would ask you, does The Jockey Club have a 
foundation or contribute money to organizations like that to 
take care of these horses running at the lower levels of 
racing?
    Mr. Marzelli. The Jockey Club has two foundations. It has 
The Jockey Club Foundation, which takes care of people that 
have fallen on hard times that have devoted their lives to the 
track. You mentioned Gary Birzer. I believe you mentioned it, 
Congressman Whitfield.
    Mr. Whitfield. I did.
    Mr. Marzelli. We helped him. We were one of the 
organizations that helped him.
    And we also have the Grayson-Jockey Club Research 
Foundation, which is one of the worldwide leaders in equine 
research. Our research that we support supports not only 
thoroughbreds but it supports all breeds.
    The Grayson-Jockey Club Research Foundation, together with 
The Jockey Club, organized the welfare and safety of the 
racehorse summit that held its first meeting, 40 industry 
leaders, in 2006. A number of recommendations and good action 
programs came out of that meeting. And----
    Mr. Whitfield. Do you provide money to the Humane Equine 
Center in Lexington or groups like CANTER who are picking these 
horses up at the track?
    Mr. Marzelli. We believe that every owner is responsible 
for their horse. And, as the member of the NTRA, we support the 
NTRA's position on slaughter.
    Mr. Whitfield. And that is?
    Mr. Marzelli. The NTRA is against slaughter.
    Mr. Whitfield. OK. OK.
    Well, thank you very much, Madam Chairman.
    Ms. Schakowsky. And let me just add, I think it is pretty 
well-known that Mr. Whitfield and I, for a long time, have been 
trying to stop the slaughter and export for slaughter of 
horses. And we are concerned that occasionally a byproduct of 
the mistreatment of horses in your industry results in just 
that, the slaughter and the export for slaughter of horses.
    So we thank you very much, gentlemen, for your appearing 
here today and for your testimony.
    And I would like to excuse this panel and welcome our 
second panel of witnesses and invite them to come to the 
witness table at this time.
    And I am going to turn the Chair over. Mr. Hill of Indiana 
will come to chair this meeting at this time.
    Mr. Hill [presiding]. OK. I would like to welcome our 
second panel of witnesses and once again invite them to come to 
the witness table at this time. Our witnesses are Lawrence 
Soma, a veterinarian of New Bolton Center, University of 
Pennsylvania. Dr. Soma is an equine pharmacologist and thus an 
expert on the effects of drugs and medications on thoroughbred 
racehorses.
    Sue Stover, a veterinarian at the University of California 
Davis. Dr. Stover is a specialist on orthopedics and has 
extensively studied the cause of breakdowns and other injuries 
afflicting thoroughbred racehorses. Doctor, it is good to have 
you with us.
    Wayne McIlwraith, a veterinarian at the Colorado State 
University. Dr. McIlwraith is an orthopedic surgeon and, like 
Dr. Stover, is an expert on the nature and causes of injuries 
and breakdowns. Doctor, it is good to have you with us.
    Mary Scollay, medical director, Kentucky Horseracing 
Authority. Dr. Scollay was recently hired in her new position 
and was formerly the track veterinarian at Calder Racehorse 
Course in Florida.
    Allie Conrad, executive director of Mid-Atlantic CANTER. 
CANTER adopts thoroughbred racehorses from the track and trains 
them for new careers in retirement.
    And Alex Waldrop, president and CEO of National 
Thoroughbred Racing Association. Mr. Waldrop testified before 
the February 27th Senate committee hearing on performance-
enhancing drugs in sports. NTRA is an association whose 
membership includes racetrack operators and the Jockey Club.
    Once again, ladies and gentlemen, I would like to remind 
you that your written statements have all been shared with 
committee members and submitted for the record. If you have 
opening statements, please take up to no more than 5 minutes 
for them.
    We will begin from my left, your right, with our first 
witness Lawrence Soma.

  STATEMENT OF LAWRENCE R. SOMA, V.M.D., PROFESSOR, SCHOOL OF 
     VETERINARY MEDICINE, NEW BOLTON CENTER, UNIVERSITY OF 
                          PENNSYLVANIA

    Dr. Soma. Mr. Chairman, members of the committee, I am 
going to discuss two issues today, and that is anabolic 
steroids and furosemide as it pertains to in the bleeding 
horse.
    The State of Pennsylvania is presently regulating the use 
of anabolic steroids in racehorses. Pennsylvania began 
addressing the steroid issue in 2003. The impetus was the 
common knowledge of their use. At that time we developed 
analytical methods for detection, quantification and 
confirmation of injected and naturally occurring steroids in 
plasma. Those methods were published in 2005 and 2006.
    Pennsylvania is currently regulating the use of anabolic 
steroids by analyzing postcompetition plasma samples. Plasma 
samples were chosen over urine because of the pharmacological 
action of any drug. It is generally based on the plasma 
concentration of the active drug and not its concentration in 
urine. The complex excretion pattern of steroids makes the 
analysis of urine more difficult, and in the use of plasma we 
can screen for the presence of the drug.
    We screen for approximately eight or nine anabolic steroids 
currently, and we allow its quantification; that is, we can 
tell how much is in there. Analysis of plasma samples from 
winning horses in 2003 confirmed that 60 percent of the horses 
racing in Pennsylvania had steroids in them, and some had more 
than one. That is in our first survey done in 19--I mean, 
excuse me, 2003.
    Anabolic steroids are very slowly eliminated from the body. 
Because of this problem the racing commission agreed on a 
transition period using the plasma concentration of steroids as 
guideposts. This transition period would allow the horse to 
compete during this period as the plasma concentration of 
previously administered steroids decreased.
    The average plasma concentration of anabolic steroids has 
progressively dropped from the month of March, where we started 
screening all horses running in the State of Pennsylvania, 
through July 10th. As of July 10th the average concentration is 
below 100 picograms per milliliter. Now, 100 picograms per 
milliliter is parts per trillion. In our survey in 2003, we had 
2,000 or 3,000 to 4,000 picograms of anabolic steroids or 
testosterone in some of our horses that are racing. We are now 
on the way. Just about most of the horses in the State of 
Pennsylvania are running free of anabolic steroids.
    So, in summary, I think we have made considerable progress. 
We are leveling the playing field as far as anabolic steroids 
are concerned, and to the best interests of the bettor and the 
horse.
    Now, the second issue is bleeding in the horse, and you 
have heard of the drug furosemide bandied around or Lasix 
bandied around numerous times today. In the horse small amounts 
of blood appear in the nostrils following vigorous exercise, 
and this has been noted for years. The source of blood is the 
lung, and this is termed ``exercise-induced pulmonary 
hemorrhage,'' meaning when the horse exercises vigorously, a 
small amount of blood is found in the airways, and then it 
works its way up into the trachea. The mechanism is the rupture 
of small capillaries, and this is because of the changes in 
blood pressure that occur in the lung in the horse, which are 
very high. Pressures of that magnitude, 100 millimeters of 
mercury or so in us, would produce pulmonary failure.
    Furosemide is used as a prerace medication with the 
expectation of reducing arterial lung pressures, thereby 
reducing or eliminating bleeding. The reduction in pulmonary 
pressure, pharmacologically and physiologically produced by 
furosemide are not of significant magnitude to prevent or 
markedly reduce bleeding.
    The effect of furosemide in EIPH. No studies have shown an 
absence of blood or a reduction of bleeding in horses diagnosed 
with EIPH following the administration of furosemide.
    The effect of furosemide on racing times. There have been a 
total of five studies to examine racing times. The largest 
examined the record of 22,000 horses running in North America. 
The conclusion from all studies was that horses that were 
administered furosemide raced faster, earned more money, and 
were more likely to win or finish in the top three positions 
than horses that did not.
    The detection of drugs in urine. A concern with the 
administration of furosemide is the dilution of urine produced 
by the extensive urination and the possible influence this 
dilution might have on detection of drugs in the urine. This 
aspect has been minimized as technology has increased. And as 
you know, if a horse is administered furosemide, it has to run 
3 to 4 hours later. So this will minimize the effect on the 
finding of drugs in urine. But still it is a concern to all 
laboratories.
    In summary, furosemide does not prevent bleeding, improves 
performance in some horses, can dilute urine to compromise 
detection of drugs, and violates the rules of most States that 
there should be no medication on race day.
    Thank you very much.
    Mr. Hill. Thank you.
    [The prepared statement of Dr. Soma follows:]

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    Mr. Hill. Dr. Stover.

   STATEMENT OF SUSAN M. STOVER, D.V.M., PH.D., DIPL. ACVS, 
                 UNIVERSITY OF CALIFORNIA DAVIS

    Dr. Stover. Thank you, Mr. Chairman and members of the 
committee.
    California has monitored racehorse deaths for over 15 years 
through a postmortem program mandated by the California 
Horseracing Board and implemented by the racetracks and the 
School of Veterinary Medicine at the University of California 
Davis. Over 4,200 racehorses have been necropsied through this 
program. This is a sobering statistic. As a veterinarian this 
is devastating, and each fatality is totally unacceptable.
    My research laboratory is devoted to understanding the 
causes and development of injuries so that strategies can be 
developed for injury prevention. Seventy-nine percent of deaths 
are associated with injuries incurred during racing and 
training. Until recently fatality rates had slowly increased 
over time in California. Approximately 3 to 5 horses die per 
1,000 thoroughbred race starts. The fatalities are just the tip 
of the iceberg. Because milder injuries cause many horses to 
leave racing after short careers, approximately 20 percent of 
racehorses leave racing every 3 months.
    Pathologic evidence indicates that many catastrophic, fatal 
musculoskeletal injuries are the acute manifestation of a 
sudden occurrence following preexisting milder injuries that 
develop over several weeks to several months. Mild injuries are 
typically repetitive, overuse injuries common to elite athletes 
of any species. Microscopic damage occurs when bones are loaded 
during exercise. When this damaged bone is replaced by healthy 
bone tissue through a normal process, there is a transient 
period of osteoporosis that makes bones highly susceptible to 
fracture even under normal racing and training conditions. 
Consequently horses are actually inadvertently susceptible in 
periods of time to injury under normal conditions; that is, 
without intentional abuse by trainers, owners, or 
veterinarians.
    The clinical science preceding fracture development may be 
subtle and difficult to detect. Consequently there is a need to 
optimize the ability to detect injuries during the early stages 
of development. Advanced imaging techniques and accessibility 
to advanced imaging equipment are continually improved; 
however, permitted medications likely mask signs of mild injury 
and contribute to injury development.
    Injuries, however, are multifactorial, with numerous 
contributing factors that create opportunities, however, for 
injury prevention, and I am optimistic that we can prevent 
injuries. Epidemiologic evidence indicates the horse 
characteristics, training and racing history, hoof management, 
horseshoe characteristics, preexisting musculoskeletal injuries 
and race characteristics all affect risk for injury. Key 
factors affect the magnitude and frequency of loading and can 
be managed for injury prevention.
    Racing jurisdictions are actively addressing the injury 
problem, at least in California. In fact, racehorse owners, 
trainers and veterinarians, officials, and industry regulators 
have embraced scientific evidence and implemented changes for 
the benefit of equine welfare that countered long-standing 
traditions. Advanced imaging equipment has been installed at 
some major California racetracks to enhance early detections of 
injuries. Jurisdictions have mandated limitations on the height 
of a traction device, toe grabs, on horseshoes after a study 
demonstrated an association with increasing risk for injury 
with increasing height of toe grab. Recent scientific evidence 
indicated that a synthetic race surface imparts significantly 
lower loads and accelerations to the hoof during exercise. 
California mandated that all major racetracks replace 
traditional race surfaces with a synthetic race surface, at 
huge expense to racetrack management. And other racetracks have 
voluntarily replaced traditional race surfaces with synthetic 
surfaces. Initial preliminary injury data support the concept 
that race surface design and management have large potential 
for injury prevention.
    Racing communities are working collaboratively on a 
national level to address industry problems. National summits 
that addressed equine welfare in 2006 and 2008 were held by the 
Grayson Jockey Club Research Foundation. These strategic 
planning sessions brought together scientists and leaders from 
all facets, breeding to racing, workforce to management of the 
racehorse industry, to identify problems, recommend--develop 
recommendations for problem resolution.
    However, the racing industry consists of complicated parts. 
I am unaware of an industry model that identifies relationships 
between the components of the industry. It is conceivable that 
management decisions inadvertently affect racehorse training 
and management and thus have effects on equine health and 
welfare. The number of horses required to fulfill racing 
inventory while minimizing racehorse attrition is unknown. The 
underlying racehorse population is largely unknown, and medical 
data are difficult to retrieve.
    Further scientific research is desperately needed to guide 
the industry. Changes, for example, on racetrack surface design 
are largely based on marketing factors because of sparse 
scientific data. However, research funds are sparse relative to 
the size of the industry. Equine research proposals are not 
competitive for Federal funds because horses are not considered 
an agricultural product nor related to human health. 
Dissemination of findings needs to be broader.
    In summary, musculoskeletal injuries are devastating to 
equine welfare and to the thoroughbred racehorse industry. 
There are, however, great opportunities for intervention and 
injury prevention. The key to tracking the prevalence of 
injuries and the success or lack of success of interventions is 
identification of the underlying racehorse population. The 
industry should consider a mechanism for identification of 
horses that can be used for a horse's medical record, location, 
exercise and movement, and racetrack horse inventory. The 
racehorse industry and Federal granting agencies need to make a 
substantial adjustment in research related to equine welfare 
and mandatory continuing education of those people in the 
industry.
    Thank you for the opportunity to speak before this 
committee.
    Mr. Hill. Thank you, Dr. Stover.
    [The prepared statement of Dr. Stover follows:]

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    Mr. Hill. Dr. McIlwraith.

STATEMENT OF WAYNE MCILWRAITH, PH.D., D.V.M., F.R.C.V.S., GAIL 
   HOLMES EQUINE ORTHOPAEDIC RESEARCH CENTER, COLORADO STATE 
                           UNIVERSITY

    Dr. McIlwraith. Thank you, Mr. Chairman and members of the 
subcommittee. By way of introduction, I am director of the Gail 
Holmes Equine Orthopaedic Research Center at Colorado State 
University, and also hold the Barbara Cox Anthony University 
Chair in Orthopedics. I am also an active equine orthopedic 
surgeon, and so I am involved in the immediate repair and 
treatment of equine musculoskeletal injuries, although I am not 
too sure how good that is anymore based on the last panel.
    I feel privileged to work on these horses, but probably 
more importantly I direct a program to discover productive 
answers for prevention and early diagnosis of these injuries. 
As a personal example of my mixed job description, last weekend 
I did surgery on eight horses at the Equine Medical Center in 
California, and on Sunday I stayed in the hotel room to prepare 
the written statement for this hearing.
    I would like to comment on three critical areas that I 
think make a difference regarding catastrophic fractures in the 
thoroughbred racehorse and what we are doing to address these 
issues. There is no question, as Dr. Stover has previously 
said, that we have an unacceptable rate of injury in the U.S. 
And these three areas are areas where we have done some 
research and we have got ongoing efforts to try and solve.
    The first one is fracture prevention, and it is based on 
the premise of prior damage leading to catastrophic injury and 
early recognition of this damage being key to prevention. There 
is an accumulating body of evidence that the presence of 
microdamage could lead to catastrophic fractures. This is the 
same cycle of remodeling that Dr. Stover talked about. And 
there is evidence. This evidence is actually based originally 
on postmortem material done at UC Davis that Dr. Stover was 
involved in, and more recently in work on looking at the 
changes in bone with exercise that is being done experimentally 
at CSU.
    We have a number of ongoing research projects looking at 
factors that might predispose to this microdamage and therefore 
consequently fracture. These include joint and muscle modeling 
to calculate the real forces, generic analysis, as well as the 
effect of early exercise on bone changes. And interestingly 
enough we have found that early exercise can benefit the 
musculoskeletal system of young horses.
    The most exciting and important part of this work, in my 
opinion, is what we have done to diagnose this microdamage 
early, using blood biomarkers as well as novel imaging 
techniques. The principle of biomarkers is when the bone and 
cartilage degrades early in disease with this microdamage, 
degradation products are released, and these can be picked up 
by antibody tests that we have developed.
    We have recently completed a study that was funded by the 
Grayson Jockey Club Research Foundation looking at these 
biomarkers in a predictive fashion. We found that there was an 
elevation of these markers in horses that sustained an injury 6 
to 8 weeks after the elevation. We are up to 70 percent 
predictability, but want to work to 100 percent. The long-term 
vision here is that we could use regular blood samples to 
analyze the biomarkers and identify a horse at risk. That horse 
could then go into a bone scan, and this has previously been 
shown to help diagnose early microdamage, or a CT to further 
define the problem.
    We have already saved horses with nuclear scintigraphy, and 
this early work was based on research of Dr. Stover identifying 
that stress fractures led to catastrophic fractures, and 
consequently if we diagnose those early stress fractures, we 
could diagnose a problem and stop catastrophic injury.
    Unfortunately, not all horses show lameness, and so the 
biomarkers, we think, are critical to screening the horse at 
risk.
    The second area I wanted to discuss is racetrack surfaces. 
There has been considerable discussion on synthetic tracks. I 
have been working with Dr. McPetersonat the University of Maine 
on developing objective means of evaluating racetrack surfaces. 
So we have created tests that reproduce the loads and speeds of 
a horse's hoof at a gallop and measure the response on a 
surface area. We are also in the process of doing further 
research to set standards and make recommendations of optimal 
maintenance of both dirt and synthetic surfaces. This work was 
funded initially by the America Quarter Horse Association, and 
more recently by a grant from the Grayson Jockey Club Research 
Foundation, as well as contributions from selected racetracks.
    I am chair of the track surface subcommittee that developed 
out of the welfare summits, and we recently voted to establish 
a laboratory to provide individual analysis of both dirt and 
synthetic racetrack surfaces to give the feedback back to the 
superintendents of the racetracks.
    The third area, of course, is medication, which has been 
discussed previously by the previous panel. The American 
Association of Equine Practitioners initiated and coordinated 
our industry's first ever racing medication summit in 2000. 
From this summit came the formation of the Racing Medication 
and Testing Consortium, and its mission is moving the racing 
industry to uniformity in the areas of medication policy, 
testing, security, and penalties. To date, 32 of 38 States have 
banned all race-day medication except the antibleeding 
medication Lasix. This policy was initiated by AAEP, whose main 
goal is the health and welfare of the horse.
    More recently the RMTC wrote a model rule to regulate 
anabolic steroids and recommended adoption by January 1, 2009. 
The new safety committee formed by the Jockey Club has already 
adopted this policy. And as you heard previously, 11 out of 38 
States have already adopted this policy.
    In summary, these are three critical issues from my 
perspective as an equine orthopedic surgeon and researcher that 
are critical and are positive. These issues among many others 
have already been worked on, and there is ongoing progress in 
them. As veterinarians we continue to promote the health and 
welfare of every equine athlete. Thank you.
    Mr. Hill. Thank you.
    [The prepared statement of Dr. McIlwraith follows:]

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    Mr. Hill. Dr. Scollay.

STATEMENT OF MARY C. SCOLLAY, D.V.M., EQUINE MEDICAL DIRECTOR, 
                KENTUCKY HORSE RACING AUTHORITY

    Dr. Scollay. Mr. Chair and committee members, good 
afternoon. I served as racetrack regulatory veterinarian for 20 
years and will begin serving as equine medical director to the 
Kentucky Horseracing Authority on July 8th, so you can either 
say I am on vacation or unemployed at the moment.
    I want to talk for a minute about the role of the 
regulatory veterinarian at the racetrack. The regulatory 
veterinarian is charged with preventing injury; mitigating 
injury should it occur; and affording prompt, humane euthanasia 
when an injury cannot be mitigated. Very simply, my obligation 
was to the horse, and I answered to my conscience.
    In order to fulfill my responsibility to the horse, my 
activities include pre- and postrace soundness evaluation; 
triage of racing injuries; medical recordkeeping; 
implementation of pre- and postrace testing programs; research 
collaboration with academic institutions; management of herd 
health; equine infectious disease and environmental disease 
issues; policy development and rulemaking, and liaison between 
horseman, racetrack management, governmental regulatory 
agencies, and private veterinary practitioners.
    As the focus of this panel is racing injuries, the 
following is a basic description of race-day injury prevention 
measures taken by regulatory veterinarians. Morning prerace 
exams are performed on all entered horses. Horses are then 
monitored by a veterinarian from the time they arrive in the 
paddock until they have safely exited the course. And this 
would include observation during the post parade, any activity 
in the starting gate, during the race, after finishing, and 
prior to returning to their barns.
    At any time up to the start of the race, the regulatory 
veterinarian has the authority to require a horse to be 
withdrawn for health, safety, or soundness concerns. And I 
can't help but think in hearing horses of the past being 
referenced today, and having read Laura Hillebrand's book on 
Sea Biscuit, that had he been entered in a race today, it is 
unlikely that the regulatory veterinarian on the track would 
have permitted him to run.
    Horses with questionable status postrace are reevaluated in 
a follow-up exam, and any horse determined to be injured or 
unsound is declared to be ineligible to enter until the 
decision has been addressed to the satisfaction of the 
regulatory veterinarian. This protocol might be compared to an 
individual being accompanied through each workday by a risk 
assessment advisor and emergency care physician.
    Racing regulatory veterinarians have maintained racing 
injury records for many years; however, there has been little 
commonality in the ways that records were established and 
maintained, making data analysis and information disclosure 
problematic. At the 2006 Grayson Jockey Club Welfare and Safety 
Summit, I presented a proposal for a national standardized on-
track injury reporting program that would provide an objective 
scientific approach to addressing the emotionally charged 
problem of racing injuries. The program was initiated June 1, 
2007. Sixty racetracks have committed to reporting in 2008, and 
this number represents all but three racetracks that were 
invited to participate.
    The reporting racetracks represent a large number of race 
starts, but data submitted is representative of only those 
reporting tracks. To be a national program, all tracks must 
participate. Currently this program is voluntary, thus showing 
a consensus among the industry to participate, but reporting 
should be required for all premises that conduct pari-mutuel 
wagering on live thoroughbred racing.
    Since inception and through June 15, 2008, 2,755 reports 
have been submitted. These reports reflect a wide range of 
conditions ranging in severity from minor abrasions to fatal 
injuries.
    The on-track injury reporting program has been underwritten 
by the Jockey Club, and Incompass, a subsidiary of the Jockey 
Club Information Systems, has developed and will be launching a 
secure online reporting module. It is being provided as a 
service to the industry. There will be no user fees associated 
with reporting it to the database.
    Industry support has been strong. RCI, HBPA, Jockeys' 
Guild, in addition to racing commissions, track management, 
individual owners and trainers, have endorsed the program. We 
will continue to reach out to them and others in our efforts to 
increase program participation. While initiated as a 
thoroughbred-specific system, the system is currently under 
review to identify data collection modifications that may be 
required for implementation in quarter horse racing.
    Phase 2 of the reporting program has been initiated as a 
pilot program and expands reporting to include training, 
postrace detection and nonrace-related injuries. The collection 
of comprehensive and reliable data regarding training injuries 
is substantially more complex than that of race-related 
injuries; however, scientific studies indicate that 
catastrophic racing injuries are the result of cumulative 
events, therefore injury occurrence must be tracked 
comprehensively if precursors to catastrophic injuries are to 
be identified. Medication usage out of competition must also be 
scrutinized.
    It is intended that this injury database will generate 
valid composite statistics that identify national injury rates. 
Beyond that it is hoped that this epidemiologic database will 
enhance injury prevention strategies. There is no end point for 
data collection. It is by design a standing program. With 
continued industry support this database will serve as a key 
scientific tool in protecting the health of the equine athlete.
    Thank you.
    Mr. Hill. Thank you, Doctor.
    [The prepared statement of Dr. Scollay follows:]

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    Mr. Hill. The panel should know that in about 5 to 20 
minutes, somewhere there, we are going to be called for votes. 
So we will see how this comes along, and we will make decisions 
as facts present themselves.
    Ms. Conrad.

   STATEMENT OF ALLIE CONRAD, EXECUTIVE DIRECTOR, CANTER MID-
                ATLANTIC, GAITHERSBURG, MARYLAND

    Ms. Conrad. Thank you, Congressman Hill and members of the 
committee. I am honored to be here to speak on behalf of the 
horses that you do not see on TV, those running on the bottom 
of the low-level claiming tracks. I am here to point out the 
issues we see every day so that they can be discussed by the 
esteemed members of this panel and resolved through an 
independent oversight agency.
    I am sure you are wondering what qualifies me to be sitting 
here amongst these panelists. I am qualified to be here because 
I rehabilitate and rehome racehorses from what is thought to be 
one of the most infamous tracks for breakdowns in the country, 
Charlestown, just 90 minutes from where we sit. I am qualified 
to be here because I touch these animals every day. I see the 
condition they are in every day. I am qualified to be here 
because I must make the heartbreaking decision to turn them 
away from our organization due to lack of financial resources.
    One thing made very clear to me is that racehorses are not 
protected from horrific ends by their pedigree. They are not 
protected by their high sales price at the auctions. They are 
certainly not protected by the money they win for owners.
    You can take a minute to look at the racing chart of this 
horse, 11-year-old horse, running. He has been running his 
entire life. His name is Ask the Lord. A year ago he was 
running for $55,000 per race. He is now running for $7,500 and 
is most certainly running on injected joints. He will run 
again, and he will run again, and he will run again until he 
breaks down, in my opinion. He has been claimed and claimed and 
claimed. It is a terrible, terrible thing.
    We have cared for and rehomed sons and daughters of Derby 
winners. We have rescued horses who have won $1 million. None 
of it mattered once they could no longer perform.
    The only thing that protects a racehorse from a horrific 
death is having the good fortune of being owned and trained by 
caring, honest people. And there are caring people in this 
sport. And while I would like to acknowledge and thank these 
people, we are not here to talk about them. We are here to 
discuss the people that do not care, the people ruining what 
used to be the Sport of Kings. They are running their horses on 
injected joints to hide fractures. They are using claiming 
races to dump crippled horses. They are dumping their horses 
into low-end auctions when they can no longer perform.
    I have stood next to too many of these horses mangled by 
irresponsible decisions and have had them euthanized. These 
horses were not injured from a freak accident or a tragic 
misstep. They were injured over time with the assistance of 
trainers, owners and veterinarians. These horses were injected 
with legal and illegal substances, both anabolic and catabolic 
steroids--that would be cortisone EPO, very highly illegal--
race-day painkillers, and diuretics. They raced on fractures 
masked by joint injections, and they raced to exhaustion, but 
they always run as fast as their bodies will allow. It is the 
nature of the racehorse.
    I would like every person in this room to take a moment 
today to read the handout I have provided looking at our 
Michigan horses that we have euthanized. You can see the lives 
that were wasted. This is not speculation or hearsay; this is 
hard evidence of what is happening to our horses, and it is 
applicable to every low-level track in this country.
    Perhaps the most disturbing part of our hard work is that 
we are trying our best to clean up racing's mess without 
financial support from the racing industry itself. An informal 
poll of five different nonprofits revealed that less than 5 
percent of our funding came from racing itself. Consider this: 
The rehoming groups, there are several of them, many of them, 
thank goodness. We need more. They receive less than 5 percent 
from a multibillion-dollar industry to care for the horses that 
they have made their living from.
    Racing is not bothering to take care of its own horses, and 
they are allowing the public, often not even racing fans, to 
take care of the problems. This must change. It should be an 
owner's responsibility to provide veterinary or surgical care 
when they injure a horse through racing. It should be their 
responsibility to maintain that horse during its 
rehabilitation. Funds to care for these animals, if they do not 
come from the owner and trainer, need to be set aside through 
some mechanism such as starting fees or percentage of purses. 
Caring for these animals should not be an afterthought, it 
should be the first thought.
    Racehorse rehoming programs are too scarce in this country. 
It is time to put programs in place at every track in the 
United States. It would not be difficult to do. To do anything 
less is a disservice to the horses and to the people who want 
the options to do the right thing.
    The New York Times article published on June 15th states 
that over 3,000 horses died at racing facilities in 2007. That 
included many breeds; however, not every track was reporting. I 
would like to respectfully object to this number. Nowhere are 
they accounting for the horses that pulled up, vanned off, and 
got sent to the sales. They are not accounting for the animals 
whose ironic misfortune was to die in my barn instead of the 
racetrack when X-rays of their joints revealed the abuses they 
have suffered were irreparable.
    This is happening daily, and this needs to stop. I am here 
to speak for the horses who cannot speak for themselves, and I 
am here to represent every group in this country dedicated to 
their welfare. I am here to implore racing to address this 
issue.
    Thank you.
    Mr. Hill. Thank you, Ms. Conrad.
    [The prepared statement of Ms. Conrad follows:]

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    Mr. Hill. Mr. Waldrop.

  STATEMENT OF ALEXANDER M. WALDROP, CHIEF EXECUTIVE OFFICER, 
            NATIONAL THOROUGHBRED RACING ASSOCIATION

    Mr. Waldrop. Mr. Chairman, Ranking Member Whitfield and 
members of the subcommittee, thank you for this opportunity to 
speak on behalf of the National Thoroughbred Racing 
Association, its 65 member racetracks, 40 horsemen's groups, 
and 1 million individual supporters. NTRA is thoroughbreds' 
only centralized authority representing virtually all industry 
stakeholders, including owners, breeders, trainers, racetracks, 
riders, racing fans, and veterinarians. As such, we serve the 
industry as a consensus builder around solutions to problems of 
national importance for the horseracing industry.
    With an industry as diverse as ours, consensus is often 
difficult; nonetheless, our stakeholders agree that the health 
and safety of our equine athletes is paramount to our sport. 
From its earliest days pari-mutuel wagering has partnered with 
State governments to sanction and regulate horseracing both as 
a sport and as a pari-mutuel wagering industry. State 
governments ensure the public of the integrity of our 
operations through independent oversight and verification.
    States also play a critical role in ensuring health, horse 
health, and safety. States regulate our industry through State 
racing commissions, and these individual commissions operate 
under the umbrella of the Association of Racing Commissioners 
International, or the RCI, which develops and promulgates 
national standards called model rules for racing. And the 
challenge of our State-regulated structure is to implement 
uniform rules in all 38 racing jurisdictions.
    Some are questioning whether our industry has the governing 
structure necessary to effect change. I can't speak for the 
distant past, but I can tell you that recently this industry 
has been making great strides towards uniformity at the 
national level, and the NTRA has played an important catalyst 
to that change.
    One of the foremost examples of cooperative uniform 
solutions to industrywide challenges is the Racing Medication 
and Testing Consortium. The RMTC is governed by a board of 
directors consisting of 23 industry stakeholders, including 
regulators, veterinarians, chemists, as well as owners, 
trainers, breeders and racetracks from all breeds. Working with 
the guidance from the RMTC, the RCI has developed a 
comprehensive set of model rules which govern the use of drugs 
and therapeutic medications in racing. These model rules have 
now been adopted in 32 of 38 racing jurisdictions, including 
all major racing States.
    The RMTC has also helped the RCI develop tough but 
standardized penalties for drug violations, and these tougher 
penalties are now in place in almost half of all States that 
conduct horseracing, with more States expected to adopt these 
penalties soon.
    Most recently we worked closely on a policy regarding 
anabolic steroids. With the full support of the industry, the 
RCI has called for all racing States to adopt a standardized 
rule removing anabolic steroids from racing and race training 
by the end of 2008. Some 28 States are now in the process of 
removing anabolic steroids from competition, with the remaining 
10 expected to follow suit shortly. Importantly, in the case of 
anabolic steroids, we have made progress in a matter of months, 
not years, proving that we can act quickly, collectively and 
constructively. This industry is no longer a rudderless ship.
    Likewise, for several years we have been addressing equine 
health and safety on a national basis. In 2006, our industry 
initiated numerous national studies in areas such as injury 
reporting, track services, veterinary research, and equine 
injury prevention; hence the panelists that we have today. The 
Jockey Club's Thoroughbred Safety Committee is the perfect 
example of cooperative work done to address our sports health 
and safety issues. In fact, you heard earlier from Mr. Marzelli 
more safety measures that have been recommended, and the NTRA 
strongly supports those and will help make sure that those 
changes are implemented.
    I have stressed to you the last thing this industry needs 
is another layer of regulation. A large Federal bureaucracy 
funded by yet another tax on our long-suffering customers is 
simply not what we need.
    We are making progress towards uniformity in drug testing 
and medication rules; removing steroids from racing 
competition; implementing a great injury reporting system, as 
you have heard; exploring new synthetic racetrack surfaces to 
reduce injuries; continuing to conduct industry-funded research 
into the cause of the equine injuries.
    The horseracing industry should be allowed to continue its 
efforts to build a more uniform and cohesive health and safety 
program for its participants. We at the NTRA and our industry 
stakeholders are uniquely qualified and fully committed to 
working through our sports complex issues as they relate to 
equine health and safety, relying on sound science and 
research. I believe that the NTRA's leadership, plus improved 
drug and safety rules, more transparency, expanded research, 
coupled with the continued oversight of this committee and the 
States themselves is the best recipe for progress that we all 
see. Our horses and our fans deserve nothing less.
    Thank you very much.
    [The prepared statement of Mr. Waldrop follows:]

                   Statement of Alexander M. Waldrop

    Chairwoman Schakowsky, Ranking Member Whitfield, and 
Members of the Subcommittee, thank you for this opportunity to 
speak on behalf of the National Thoroughbred Racing Association 
and its 65 member racetracks, 40 horsemen's groups and one 
million individual supporters.
    NTRA is Thoroughbred racing's only centralized authority 
representing virtually all industry stakeholders, including 
owners, breeders, trainers, racetracks, riders, racing fans and 
veterinarians. As such, we serve the industry as a consensus 
builder around solutions to problems of national importance to 
the horseracing industry.
    With an industry as diverse as ours, consensus is sometimes 
difficult. Nonetheless, our stakeholders agree that the health 
and safety of our equine athletes is paramount to our sport.
    From its earliest days, pari-mutuel horseracing has 
partnered with state governments to sanction and regulate horse 
racing both as a sport and as a pari-mutuel wagering industry. 
State government insures the public of the integrity of our 
operations through independent oversight and verification.
    States regulate our industry through state racing 
commissions. These individual commissions operate under the 
umbrella of the Association of Racing Commissioners 
International or RCI, which develops and promulgates national 
standards called model rules of racing. The challenge of our 
state regulated structure is to implement uniform rules in all 
38 racing jurisdictions.
    Some are questioning whether our industry has the governing 
structure necessary to effect change. I can't speak to the 
distant past but I can tell you that recently this industry has 
been making great strides towards uniformity at the national 
level and the NTRA has been an important catalyst for that 
change.
    One of the foremost examples of cooperative, uniform 
solutions to industry-wide challenges is the Racing Medication 
and Testing Consortium. The RMTC is governed by a Board of 
Directors consisting of 23 industry stakeholder groups 
including state regulators, veterinarians, and chemists, as 
well as horse owners, trainers, breeders, and racetracks from 
all racing breeds.
    Working with guidance from the RMTC, the RCI has developed 
a comprehensive set of model rules which govern the use of 
drugs and therapeutic medications in racing. These model rules 
have now been adopted in 32 of 38 racing jurisdictions, 
including all major racing states. The RMTC has also helped the 
RCI develop tough but fair standardized penalties for drug 
violations. These tougher penalties are now in place in almost 
half of all states that conduct horseracing with more states 
expected to adopt the model penalties soon.
    Most recently we have worked closely on a policy regarding 
anabolic steroids. With the full support of our industry, the 
RCI has called for all racing states to adopt a standardized 
rule removing anabolic steroids from racing and race training 
by the end of 2008. Some 28 states are now in the process of 
removing anabolic steroids from competition, with the remaining 
10 expected to follow suit shortly.
    Likewise, for several years we have been addressing equine 
health and safety issues on a national basis. In 2006, our 
industry initiated numerous national studies in areas such as 
injury reporting, track surfaces, veterinary research, and 
equine injury prevention programs. The Jockey Club's 
Thoroughbred Safety Committee is a perfect example of the 
cooperative work being done to address our sport's health and 
safety issues at the national level. In fact, as you heard 
earlier from Mr. Marzelli, more safety measures have been 
recommended and the NTRA will help in advocating for these 
changes.
    The last thing this industry needs is another layer of 
bureaucracy. A Department of Horse-Land Security funded by yet 
another tax on our long-suffering customers? No thanks.
    We are making progress towards uniformity in drug testing 
and medication rules; removing steroids from racing 
competition; implementing an injury reporting system; exploring 
new, synthetic track surfaces to reduce injuries; and 
continuing to conduct industry-funded research into the causes 
of equine injuries.
    The horseracing industry should be allowed to continue its 
efforts to build a more uniform and cohesive health and safety 
program for its participants. We at the NTRA and our industry 
stakeholders are uniquely qualified and fully committed to 
working through our sport's complex issues as they relate to 
equine health and safety, relying on sound science and 
research. I believe that the NTRA's leadership, plus improved 
drug and safety rules, more transparency and expanded research, 
coupled with continued oversight from this committee and the 
states is the best recipe for the progress we all seek. Our 
horses and our fans deserve no less.
                              ----------                              

    Mr. Hill. Thank you, panel members. We appreciate your 
attendance here and you taking the time to come before this 
committee.
    We have been called for votes. One of the skills that a 
Member of Congress has to have is to fly by the seat of your 
pants all the time. We apologize for this. But what I want to 
do is give every panel member the opportunity to ask one 
question, and then we will adjourn the committee.
    Ms. Conrad, I would like to start with you. Can you 
describe what your horses go through as they go through 
withdrawal from steroids and other drugs in their bodies when 
your organization rescues them?
    Ms. Conrad. The problems we see, they vary depending what 
drugs they are on. Unfortunately we don't have access to the 
vet records, so we don't know exactly what they are on. We are 
working backwards. I would say the most damaging things we see 
are the corticosteroids, the injections, the systemwide 
steroids that are given. We see mass weight loss, mass hair 
loss, loss of condition, depression, lethargy. They go through 
a terrible, terrible withdrawal period. And it is not just the 
anabolic steroids. That is the buzzword that has been floating 
around. That is not the worst one, in my opinion. It is not a 
great steroid, but a lot of times on the low-level tracks is 
what is holding these horses together.
    Mr. Hill. Wasn't Big Brown on steroids?
    Ms. Conrad. From what I understand, yes.
    Mr. Hill. That is not what happened to him in the last 
race, is it, withdrawal from it?
    Ms. Conrad. I do not know. I do not know. It was hot. It 
could have been a deep track. I don't know.
    Mr. Hill. Dr. Soma, would you know the answer to that 
question?
    Dr. Soma. Based on the last known administration, he wasn't 
on any anabolic steroids at the time, based on the time frame 
between when he was----
    Mr. Hill. Mr. Whitfield.
    Mr. Whitfield. Thank you. I will say that Jack Van Berg has 
won more horses than any living trainer, who testified earlier 
and is back there. I asked him that question last night, and he 
said he thought it had to do more with the split hoof than 
anything else.
    So having said that, Mr. Waldrop, I would disagree with you 
in the sense that, yes, the NTRA does have a partnership with 
State government. It also has a partnership with the Federal 
Government in that the industry came and asked for the 
Interstate Horse Racing Act to be adopted. It came back and 
asked for the help of the Interstate--from the Federal 
Government dealing with the Wire Act and with Internet 
gambling, getting exemptions for that. And I don't think it is 
unreasonable for the Federal Government to set minimum 
standards. The representative of the Jockey Club and you 
yourself have admitted that you do not have the enforcement 
mechanism to require anyone to do anything. And I think the 
first panel displayed very clearly that there are serious 
problems in the industry.
    I have talked to a lot of different racing authorities in 
each State. There is no agreement on the penalty levels of any 
of these so-called uniform rules. There is total confusion 
about the anabolic steroids. Dr. Kate Lynn, who is the expert, 
in my view, says that you cannot regulate them; they should be 
banned in their entirety.
    So I appreciate your testimony, Mr. Soma. I think you 
pointed out very clearly that Lasix and also anabolic steroids 
are not used so much for therapeutic reasons as they are for a 
performance enhancer. And other jurisdictions around the world 
do not allow anabolic steroids or Bute or Lasix.
    So with that we have other Members who have been here just 
as long as I have, so I will yield back the balance of my time.
    Mr. Hill. Mr. Stearns.
    Mr. Stearns. Thank you, Mr. Chairman.
    Ms. Conrad, you had mentioned that this system of steroids 
that are used, the blame goes to veterinarians, owners, and 
trainers. I think that is what you said; is that true?
    Ms. Conrad. Yes.
    Mr. Stearns. I would ask each of the panel to the best of 
their personal opinion, where predominantly is the blame to go 
for this system of steroids. With the veterinarians, the 
owners, or the trainers or all three? Dr. Soma, just go down 
the line.
    Dr. Soma. I think it is all three, because if a trainer----
    Mr. Stearns. I understand. We don't have a lot of time.
    Dr. Soma. All three, yes.
    Mr. Stearns. Dr. Stover.
    Dr. Stover. Well, perhaps we should all take some 
responsibility.
    Mr. Stearns. So all three are equally at fault, in your 
opinion? Aren't the veterinarians just reacting to what the 
trainers request?
    Dr. Stover. I think that is a difficult question to answer. 
I think we are all responsible for the horses' welfare.
    Mr. Stearns. OK. Next.
    Dr. McIlwraith. I agree. We are collectively responsible 
for their welfare.
    Mr. Stearns. OK. Next.
    Dr. Scollay. I would agree, but I would also add in 
racetrack management and other stakeholders.
    Mr. Stearns. The pressure comes from them also?
    Dr. Scollay. Sure, to fill races, get horses to run. If you 
are allotted stalls, you are expected to perform. And so there 
is no one group, it is everybody.
    Mr. Stearns. Now, Ms. Conrad, you can actually put the 
blame on somebody here. Everybody is waffling on this and 
saying everybody is responsible. Surely you must, from your 
perspective, think there is one group that has a little more 
pressure than the others. All three can't be equally at fault.
    Ms. Conrad. Actually I think they can. It depends on if you 
have a young vet that shows up at the track and wants to make a 
living, and the trainer says--they find out a horse has a 
fracture. The trainer says, inject it, or I am not employing 
you any longer. They have to make a living. I mean, it is 
complex.
    Mr. Stearns. OK. Mr. Waldrop.
    Mr. Waldrop. We are all responsible. The industry as a 
whole let this practice continue too long, but we resolved in 
our commitment to stop it by the end of this year.
    Mr. Hill. OK. We have 5 minutes before we vote.
    Mr. Pitts.
    Mr. Pitts. One more question. Ms. Conrad, your stories, the 
tragic stories, are very compelling. You explain the problem. 
Could you tell us a little bit more about the solution that you 
envision and the actions that are necessary to reach it?
    Ms. Conrad. Echoing the panel, the first panel, if you get 
rid of a lot of these drugs, these horses will not be able to 
run. The problem will address itself over time. It will address 
the soundness issues. If a horse's bloodline tends towards 
ankle problems, and you can no longer inject that joint 2 days 
before it runs, that horse is not going to run any longer. That 
horse is not going to be a valuable commodity as a breeding 
animal. That will resolve a lot of the problems. Funding for 
the groups that take care of the animals that aren't getting 
taken care of, that is going to solve--it is a mandate, but it 
is needed. It is needed right now.
    Mr. Pitts. Thank you very much.
    Mr. Hill. If I could ask the Committee to give unanimous 
consent to have the following organizations' statements entered 
into the--their statements entered into the record. It is the 
American Association of Equine Practitioners, People for the 
Ethical Treatment of Animals, Cosigners and Commercial 
Breeder's Association, Racing Medication and Testing 
Consortium. Without objection, I would like to have these 
written statements entered into the record.
    [The information was unavailable at the time of printing.]
    Mr. Hill. The committee is adjourned.
    [Whereupon, at 1:35 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]

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     Arthur Hancock, Responses to Questions from Hon. Bobby L. Rush

    1. You are vocal in support of a central league to govern 
horse racing. How does Congress help get the sport there?
    I can only tell you that this industry is in big trouble 
and that our only hope for survival is for us to have a central 
league. There are 38 racing jurisdictions and there is only one 
way for us to establish this league, and that is through 
Congress. We cannot operate like Nascar, because racing is 
governed by the state in which it takes place, and every state 
has its own rules and regulations. Also, our industry 
organizations have absolutely no control over these states and 
their racing rules. Therefore, we are a rudderless ship, and we 
need help. We need Congress to fix the rudder and only you all 
know how to do that. I can only suggest that you re-open the 
Horse Racing Act of 1978 and eliminate trainers from the 
language. Owners must have the right to dictate their own 
destiny. They are the ones who make it all happen and who take 
all the risks. Also, Congress can issue ``guidelines for 
excellence'' that must be adhered to by the respective states. 
We don't need to re-invent the wheel, just do what the rest of 
the world does regarding rules, regulations, and medication 
policies. This can be simply done if Congress so chooses, I 
believe, by re-visiting and changing for the better the Horse 
Racing Act of 1978. The word ``horsemen'', which is defined as 
owners and trainers, needs to be changed to ``racehorse 
owners''. This will give the owners the right to run their own 
business and it will permit us to establish a central league to 
govern horse racing.
    2. You're a 4th generation horseman. Can you talk about how 
the Thoroughbred breed has changed over the years?
    The Thoroughbred breed has become weaker over the years. 
Horses make nearly 50% fewer starts than they did 50 years ago 
and one of the main reasons for this is the permissive 
medication policy in America. It permits horses to run big 
races who normally couldn't win a moderate race, and these 
chemical horses go to the breeding shed. The results are clear. 
It's disgraceful to our industry and it is a national disgrace 
as well.
    3. You're famous for owning the late SUNDAY SILENCE, one of 
the all-time great racehorses. You sold him to Japanese 
interests, and he single handedly put Japanese breeding on the 
map as a great sire, and his pedigree was much different from 
the current bloodlines that are so popular in today's 
commercial breeding circles. Looking back, what are your 
thoughts on SUNDAY SILENCE as a sire and what he could have 
contributed to American breeding?
    SUNDAY SILENCE was a world class sire and would have 
greatly contributed to American breeding. It is sad that 
American breeders did not realize this, as the Japanese did. 
One of the reasons for this is that the same clique that has 
brought racing to the state it is in today, spread the word 
that SUNDAY SILENCE was merely a freak race horse and that he 
would not make a good stallion. Consequently, people shied away 
from taking shares in him which was a tragedy. He was a 
complete outcross and would have done us proud. These are the 
same people who long to preserve the status quo because they 
want no interference with their respective domains of self-
perceived power.
                              ----------                              

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    Wayne McIlwraith, Responses to Questions from Hon. Bobby L. Rush

    Do you believe anabolic steroids should be completely 
banned except for very narrow, therapeutic circumstances?
    Yes.
    Do you believe lasix should be banned?
    Although lasix has been shown to reduce exercise induced 
pulmonary hemorrhage (EIPH), it has also been shown to be 
performance enhancing and in my opinion it should be banned on 
race day. Presently, nearly all horses race on it and we are 
out of step with the rest of the world.
    Do you believe that analgesic medications such as bute 
should be banned or severely restricted?
    Currently no non-steroidal inflammatory drugs (NSAIDs) are 
allowed to be used on race day. The current laws regarding a 
certain allowable level are good in my opinion.
    Do you believe Thoroughbreds are becoming more fragile?
    Comparative figures for the number of starts would 
insinuate strongly that the durability of racehorses is less. 
There is little specific data on fragility but this needs to be 
looked at.
    Are breakdowns more frequent?
    Data is available from the California post mortem program 
which would indicate that breakdowns are not becoming more 
frequent but we are not lowering the incidence. Recent data 
over the past year insinuates a decrease from 2 to 1.5 per 1000 
starts with synthetic race tracks.
    Do we have accurate data to make such determinations?
    Yes such data was presented at the Welfare and Safety 
Summit in October 2006 by Dr. Stover of UC Davis (also on the 
panel).
    Do we have the technology to prevent more breakdowns from 
happening? Is it feasible to detect micro-fractures before they 
get worse?
    Yes. Nuclear scintigraphy (bone scanning) and computer 
tomography (CT) have the ability to detect microdamage but are 
not practical as screening tools. Our recent work at Colorado 
State University in a project in southern California and funded 
by the Grayson-Jockey Club Foundation showed that we can detect 
much of this damage with blood biomarkers and this has the 
potential to be a useful, practical technique for identifying 
the horse at risk.
    Many horsemen say that horse's bones aren't as strong as 
they used to be or that their bodies are just too big, because 
of breeding and handling. What does the science say?
    There is no scientific evidence at this stage to say the 
bones are not as strong or that bodies are just too big. 
Scientific evaluation of this is difficult but should be 
attempted in the future.
    What do you recommend industry can do to help prevent 
catastrophic breakdowns and other injuries at racetracks?
    Do the science. The principal areas where we have real 
possibilities are 1. Identifying prior damage that leads to 
catastrophic injury and early recognition of this damage by the 
use of micro blood biomarkers and novel imaging techniques. 2. 
Scientific evaluation of various racetracks rather than 
unrealistic expectations for synthetic tracks. Dr. Mick 
Peterson, from the University of Maine, has developed an 
objective method of assessing the tracks and this machine 
should be available at all racetracks. 3. Strict rules on 
medication, and 4. Further work on durability of race horses as 
has been started by the Durability Index that came out of the 
2006 Racing Summit.
                              ----------                              


    Mary C. Scollay, Responses to Questions from Hon. Bobby L. Rush

    1. Do you believe anabolic steroids should be completely 
banned except for very narrow, therapeutic circumstances?
    Yes, this position is reflected in the language of the 
anabolic steroid rule currently under review by the Kentucky 
Horse Racing Commission. There is no legitimate indication for 
the administration of anabolic androgenic steroids in healthy 
horses in training and/or racing.
    2. Do you believe lasix should be banned?
    Our understanding of the effects of furosemide has evolved 
to include concerns about its ability to enhance performance. 
Until ongoing research data is analyzed and published, I 
recommend taking no action to ban furosemide. I do, however, 
believe that the jurisdictions currently permitting a maximum 
dose of 500 mg (10 ml) should reduce that maximum to 250 mg (5 
ml).
    Currently, furosemide is the only medication that has been 
demonstrated to reduce the incidence and/or severity of 
exercise induced pulmonary hemorrhage. Recognizing that upwards 
of 85% of horses performing at maximal exertion will experience 
EIPH (and this extends beyond Thoroughbred racing to other 
disciplines such as barrel racing and competitive pulling 
events for draft horses) I believe it would be inhumane to 
withdraw the medication given its documented ability to prevent 
or mitigate the onset of the condition.
    The medication is not without negative side effects 
including dehydration, electrolyte imbalances, and muscle 
cramping. If an alternative medication were determined to be 
as, or more effective, and without the associated adverse 
events, then yes, I would recommend furosemide be banned. 
Pending the development of such a medication, I believe that 
furosemide should be closely regulated, but not banned.
    3. Do you believe that analgesic medications such as bute 
should be banned or severely restricted?
    I believe that we need to understand the scope of the use 
of analgesic medications before we could address restricting or 
banning their use. There has been a tremendous focus on race 
day medication, but the use of medications outside of 
competition has not been examined. If we accept that 
catastrophic injuries are the cumulative result of minor 
repetitive injuries (some clinically apparent, others perhaps 
not), then do we not need to understand if the administration 
of analgesics outside of competition has any association with 
the race-related catastrophic injury?
    I would strongly oppose a ban on analgesic medications; 
they have a significant therapeutic role when used judiciously. 
We need to identify the boundaries of `judicious' use to 
prevent the masking (deliberate or otherwise) of conditions 
which may be an early warning for more severe conditions to 
follow.
    4. Do you believe Thoroughbreds are becoming more fragile?
    No, I believe we are placing increased athletic demands on 
them which in turn put them at increased risk of injury.
    5. Are breakdowns more frequent?
    We have no way of knowing. The data does not exist. There 
is the appearance that racing injuries are occurring more 
frequently, but that may be a media related phenomenon. When 
twelve race cards can be viewed from a single site, the 
likelihood of observing a horse being injured has increased by 
twelve fold. When the only way to see a horse race was to go to 
the racetrack to watch the live, on-site racing, the exposure 
of a racing injury was considerably reduced when compared to 
the current environment that includes internet, simulcasting, 
TVG, HRTV, etc.
    Moving forward, this is one of the questions that the 
Equine Injury Database will be able to answer. Previous data 
cannot be recaptured, but questions like this one will be able 
to be answered-factually-as the database accumulates 
information over time.
    6. The Jockey Club recently announced the launching of a 
nation-wide database that tracks Thoroughbred injuries. Are 
tracks required to report injuries to this database or is 
participation voluntary? Are injuries from training also 
reported?
    Participation is voluntary, but the industry response has 
been overwhelmingly positive. This initiative alone proves that 
the racing industry is able to achieve consensus and speak with 
a unified voice. I estimate that greater than 80% of the race 
starts in North America in 2008 will be represented in the 
Equine Injury Database, and I further expect that by the end of 
2009, there will be 100% participation.
    The program is being expanded to include reporting of 
health conditions-injuries, illness, etc-outside of the scope 
of a race. Training injuries are now being reported in several 
jurisdictions as part of a pilot project.
    7. Before the data present a more clear picture, what 
immediate recommendations do you have for the industry to help 
prevent catastrophic breakdowns and other injuries at 
racetracks?
    I would urge those in authority to base decisions on fact 
and not speculation. There have been assertions brought forth 
in many forums that are easily refutable by scientific data. 
The issue of racing injuries has been driven by emotion. That 
emotion has served as a catalyst for the industry to seek 
change-but the change must be based on an objective, scientific 
foundation or we risk doing something differently, but not 
better.
    There should be a requirement that all entered horses 
undergo a pre-race exam by a regulatory veterinarian. There 
should be follow up exams post race on any horse whose 
condition was questionable immediately following the running of 
a race. Any horse determined to be injured/unsound/ or 
otherwise unfit for competition should not be permitted to 
enter to race until having been released by a regulatory 
veterinarian. A horse working in front of the regulatory 
veterinarian for release from the Vets' List should be in 
compliance with race day medication rules and be subjected to 
post-work testing to confirm compliance. Information collected 
and maintained by regulatory veterinarians with regard to the 
racing soundness of horses should be able to be shared between 
racing jurisdictions without fear of legal repercussions with 
respect to violation of confidentiality.
    There should be penalties in place (of sufficient severity 
as to serve as a deterrent) for a trainer who attempts or 
succeeds in entering a Vet Listed horse in another 
jurisdiction.
    There should be accountability for those trainers whose 
horses are disproportionately represented on the Vets' List for 
being unsound/injured/ or otherwise unfit to race.

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