As Saratoga Race Course prepares for Thursday's opening day of the 2019 meet, the New York Racing Association is moving forward with a new CEO and president, David O'Rourke, who replaced Chris Kay in March.
Kay had held the top position since 2013, a period during which NYRA was returned to private control after five years of state oversight. He resigned in January in light of published reports that he was using NYRA employees for maintenance and yard work at his home in Saratoga Springs.
O'Rourke was a logical successor on an interim basis, since he had been deeply involved in the financial and business development side and appeared to be well-positioned to keep the operation running smoothly. On March 26, NYRA removed the interim tag and named him CEO and president.
The 45-year-old New Jersey native moves into the top position just in time for significant changes to the Saratoga meet. There will be racing five days a week instead of six, with dark days on Mondays and Tuesdays. A nd NYRA will unveil the largest capital improvement to the track in more than 50 years, the $30 million 1863 Club replacing the At The Rail Pavilion and temporary luxury suites on the first turn.
Meanwhile, the sport of horse racing has also come under fire from animal rights activists after a rash of horse deaths in California, which will cast a shadow over the Saratoga meet.
O'Rourke addressed these topics and more during a telephone interview this past week:
What was your professional background when you started working for NYRA, and to what degree were you a racing fan before that?
I worked in the consulting field and restructuring. I came to NYRA during the bankruptcy in 2007. They hired my firm, Kroll Zolfo Cooper, to work as a financial adviser on the plan of reorganization. I worked on that with NYRA for approximately a year, and I was offered the position of director of financial planning.
I grew up in New Jersey, in Bergen County, and had been to Monmouth and the Meadowlands a couple times. Like most casual fans, I was paying attention during the Triple Crown.
I was a casual fan before I got here. I didn't know really that much about the sport, other than the big races, and the Haskell in New Jersey. Once I got here, it took a couple years and I kind of fell in love with the sport and decided to make a career here out of it.
I moved from the finance side into business development, focusing a lot on ADW [advance deposit wagering], television distribution and content. So I was really immersed in the wagering side of the business. Over the course of time, we've rolled out television shows and I've gotten a feel for other parts of the business.
Glen Kozak [NYRA senior vice president, operations and capital projects] and I started roughly at the same time, so I've had a long-term relationship with him and I have to attribute a lot of my appreciation specifically for the pieces of the business that I'm getting into now to Glen. He's a track man, he's spent his whole life around the sport, so he's been a huge asset for me in terms of understanding the game comprehensively.
You beat me to my next question, which is how much different is it overseeing the whole operation now, and what areas are you forced to pay more attention to that you previously hadn't?
The actual horsemen and the other side of the business, the economics around their part of the game. It's something that, obviously, you're seeing it, but I'm much more immersed in gaining an understanding for it. It's a lot of fun, in a way, because it's a whole new thing to learn and to appreciate. It has its own set of challenges. That is the part of the business that I'm getting up to speed on, and actually enjoying the process.
What are the pros and cons of the Saratoga meet calendar change, for all the stakeholders involved, and what are the odds that this will be a permanent change beyond next year?
That's tough for me to answer right now until we get some data back. And it's two sides. For NYRA, what's the impact of running five days a week? How does that impact our economics, in terms of wagering per capita, F&B [food and beverage] per capita of people at the facility? It's an extra weekend that, on paper, looks quite good, and for us, internally at NYRA, what's the impact on the workforce?
When we come back downstate after the meet, it's a grueling meet, six days a week, so in terms of the work-life experience for our employees, that's another metric that we're going to gauge.
And then, Saratoga works so well because of the synergies between the town and the community and at the track itself. So the feedback coming from the business community and the community at large up there is going to be extremely important to us. We hope to have some meetings up there after the meet to get some knowledge on, how did it impact the hoteliers, the restaurants. The people that have to live there with the influx of tens of thousands of people into your community. It's fun for a little while, but it also is a bit of a strain on all the resources up there.
But I wouldn't want to answer anything beyond ... construction is a two-year-timeline, so it's likely that we would be doing the same thing next year. But the last thing we're ever going to do is jeopardize Saratoga for what it is, and what it is is the greatest meet in America. And there's a lot of components to that, a lot of stakeholders, a lot of stakeholders who are going to have input. We're going to get a lot of opinions, and we want them.
How do you anticipate the new 1863 Club will perform, and because it's climate-controlled, some people are wondering if this is going to be a facility that's open outside of the actual Saratoga meet on the calendar. Will that be the case?
The 1863 Club was a one-year build-out, which was a challenge unto itself. There's an operating plan in place, and we're going to perform to it. You have three different floors. The first floor is essentially a banquet hall that replaces the At The Rail tent. The third-floor suites essentially replace the suites on the turn. Both are upgrades, in our opinion.
Then the second floor is a club concept which can be broken into the club and a large suite, and that's kind of a new format that we'll see how it plays out.
When I came into this role, these were set in motion. So, we're going to play out the current operating plan. But it's likely it'll be adjusted the following years.
On the shoulder seasons, right now there's no operating plan. But it's obviously something that you would look at. We have a winterized building up there. What would make sense at the moment? Our focus isn't on trying to determine that. It's more on what makes sense during the meet to operate this in the best manner. But it's a valid question, and something I could probably give you a better answer in six months or so.
Santa Anita has become a big story by itself, but the sport in general has gained a spotlight over horse deaths that racing would prefer not to have, also. Will there be added safety policies or protocols for the Saratoga meet, and how much are you bracing for the extra attention that this story has brought upon everybody?
Our safety protocols, we would argue, are the most comprehensive in the industry. When we do adjust those, it's through a methodical process, which is led by experts, not by, per se, management like myself. It's people like Dr. Palmer and our vets and our track folks. We're going to adhere to exactly what we're doing now, and as they bring forth improvements to that that are consensus-driven from that group, we would implement them. But there's no immediate adjustment to what we believe are the best policies and procedures on hand for us to implement.
Related to that, there's been some question about what a lot of people perceive as a flip-flop on trainer Jerry Hollendorfer's status and whether he can race in New York. Can you give some background or explanation on where NYRA stands with him?
His owner, Mr. [Larry] Best, has transferred his horses to Don Chatlos, who is a licensed trainer in New York. We were still in the process of gathering information at that point. We welcome Mr. Chatlos to train here. He's in good standing. But that's the situation as it stands now.
Is Hollendorfer allowed to have stalls in New York, though?
He doesn't have any at the moment. If he were to reapply for stalls for himself, that would be something that we'd have to have dialogue down here at the highest level.
In light of the labor issues that some New York-based trainers, most prominently Chad Brown, have had, does NYRA have any role in how that will be addressed, or is it something that's out of your hands and not in a position to get involved with?
No, that would be out of our hands. They're independent businesses, small businesses. Everything in that area is unfortunate at the moment. But I believe everything is being rectified, and I believe everything should be fine going forward.
How does NYRA want to get involved in sports betting now that it's legal in New York?
I believe some of the casinos actually have agreements with OTB. So, based on that foot track, that'll help people have access to our product. There's two ways of looking at it. One, in the New York market, and two, in the broader national market.
Primarily, NYRA is a content provider. So, just going from the macro level on the national marketplace, we view sports betting as a big opportunity because it's going to bring a lot of other people onto platforms.
We are a sports betting product at our core. It's our number one revenue driver. It's wagering, and we're a sport. So we would want our content in the most popular store. So we think this is a good opportunity to access a market much broader than just the pure horse racing fan. We could get some crossover business, and people will have some access to what is a very good wagering product.
In New York, our objective is to be involved. That could come in several different iterations. There was the affiliate model that was deliberated recently and didn't go through. There's a constitutional amendment conversation which could go through.
The conversations I've had have been very positive. I believe that we'll be involved in some way; it's to what extent would be the question. We just view it as a good thing in the long run. It gives the opportunity for horse racing to sit alongside some other products that will potentially bring in new demos for us.
Not to get too what's-your-favorite-color-ish here, but what do you personally like about Saratoga, and what are you most looking forward to in this upcoming meet? And you can't say the 1863 Club.
The racing. As a racing fan, who doesn't love Saratoga?
I just like the comprehensive experience. I've been going up there for a decade. I went to Tulane, which is New Orleans. I had been to Fair Grounds [Race Course in New Orleans] a couple of times, but it's the town, the architecture, there's similarities.
It's [Saratoga] beautiful. The restaurants are first class. Just the entire experience of being up there is awesome, for lack of a better way to put it. It's also 5-10 degrees cooler.
And you have one of my favorite music venues there, SPAC. And Beck's playing there this year.
You'll be able to get away from the office because you're the boss now ...
It's a Monday night. This five-day thing worked out in one way.