Alex Waldrop took the reins as president and CEO of
the National Thoroughbred Racing Association in 2007.
The former president of Churchill
Downs and partner in the Kentuckybased law firm Wyatt, Tarrant &Combs sat down for a telephone
Q&A session earlier this week with
the TDN=s Steve Sherack to discuss awide range of topics, including the
NTRA=s Check-Off Program and
Safety and Integrity Alliance, VLTs in
Kentucky, threats and opportunities
to the Thoroughbred industry inAlex Waldrop
Washington D.C., and his transition
Horsephotos
from the courtroom to the racetrack.
For more information on the NTRA,
visit www.ntra.com.
Growing up in Kentucky, what are some of your earliest
memories of Thoroughbred racing?
My childhood was spent in Western Kentucky, which
is a long way from a racetrack. The Kentucky Derby
stands out as an early childhood memory that really left
an impression on me. As a Kentucky native, you always
followed the Kentucky Derby, and I guess I fell in lovewith horse racing on television.
How did you first get involved in the industry?
I began practicing law in Louisville, Kentucky, and thefirm that I joined represented Churchill Downs. I began
working a great deal with a partner in charge of that
account, and eventually wound up going [to Churchill
Downs] as general counsel. I spent the next 13 years
attending every race that Churchill ran [as general
counsel, president and senior vice president of publicaffairs]. In those days, if you were on the senior
management team at Churchill Downs, you were thereon race day. It didn=t matter what else you did or what
your job was--even the general counsel, which is what I
did at the time.
I gained an incredible amount of experience andknowledge, and really grew to love the horse racing
industry and all the people involved--frontside andbackside.
Candidly, though, it wasn=t until I came to the NTRA
that I began to learn a lot about horse racing from anational perspective. As great an opportunity as
Churchill Downs provided me, it wasn=t until I came to
the NTRA that I began to see the challenges and thepossibilities for horse racing on a national, and even aninternational scale. I learn something every day, love
what I do and the opportunity I have and don=t take it
for granted.

Night racing has become very popular at Churchill
Downs. Could you ever see the Kentucky Derby being
run beneath the lights?
We talked a lot about that when I was there. While I
think you should never say never, I do think that the
Kentucky Derby is more than a horse race. It=s a live
event, and as much of a fascination as America haswith the Kentucky Derby, it=s one of those slices ofAmericana that everyone wants to experience one day
in their lives. If you can maintain that in a night-timevenue, then sure. But that=s the challenge. I=m not sure
you can. Attracting 60,000 to 70,000 people to that
infield makes for a special environment. It would be
hard to replicate that in a night-time venue. But 20
years from now somebody will be reading thesecomments and saying, >Wow, how short-sighted washe.= You never know. It certainly works now, and it
could hardly get bigger. It would be hard for them tocontain it. You would do it for television ratings, noquestion. Even those are very strong though. You lookat those ratings compared to other national major
sports and there=s just a handful of sports that outdraw
the Kentucky Derby. That 5:30-7:00 p.m. timeslot thatthey occupy is a pretty good one. I know the televisionguys like it, and I would listen to them before I=d makeany radical changes.
The slot machine/VLT issue has really divided the public
in Kentucky. What=s the NTRA=s stance on thiscontroversial topic?
The NTRA is careful to avoid intervening in any stateissue, especially where our members are on different
sides. However, I can say in Kentucky that ourmembers are united in their belief that VLTs would still
be a good alternative for Kentucky racetracks.
Having worked on that issue personally for the better
part of 10 years when I was at Churchill Downs, I
know how important it would be to Kentucky racing to
be offer alternative gambling, but I also know how
difficult and how challenging an environment it ispolitically in Kentucky. What they=ve done with Instant
Racing is a good first step. Perhaps this can be
successfully implemented so that people will come tosee that they don=t invite the kinds of problems that thenaysayers allege will occur--crime, bankruptcy, etc. The
public will hopefully begin to see these asentertainment options that the vast majority of people
will choose, and will do so without any risk of financial
ruin or psychological damage.
How has the emergence of popular social media
platforms Facebook and Twitter affected the NTRA?
Has it helped connect with fans?
Virtually all of our marketing has a substantial
component for social media--even our television. Our
webstream product, called NTRA Live, includes live
chat and is driven primarily by social media. We evenadvertise for the broadcast using social media. We
don=t have a large budget that can afford network
television the way the NTRA did once, even two years
ago, so it=s a cost-effective way of reaching a large
number of people, and the right demographic groups aswell.

Even middle-aged adults, the baby boomers, are
beginning to embrace social media. It=s a great way to
get the word out. There=s no question that it=s the
future of marketing for our business. Thankfully, for themost part, horse racing is embracing it and seeing it asa huge opportunity. NYRA and Keeneland have done agreat job. Most of the major racetracks are using social
media and other Web 2.0 platforms to get the wordout. It=s one of the beauties of horse racing. Unlike
many other major sports, we easily adapt to theInternet. Not only from a viewing standpoint, but froma wagering standpoint. One of the huge advantages
that we have moving forward is the resilience of our
product. We criticize ourselves for being old and slow
to change, but it=s really untrue. Look at the history of
our sport--we=ve innovated many times to maintain our
status on the sports landscape in this country. We=ve
embraced the internet as openly as any sport that I=maware of. We may not have the MLB=s financial
resources to put forth this gargantuan website, and we
may not have the cooperation that some of the sports
leagues have, but we certainly don=t lack forenthusiasm, passion, or for interest when it comes tosocial media and other advertising via the web.
Earlier this year the NTRA website began providing live
coverage of major stakes races, including the seasonal
debuts of Zenyatta and Rachel Alexandra. How=s the
feedback been so far?
NTRA Live is our web-based product, which is uniquein that it=s not a live-streaming video of an event, but infact, it=s a produced show. We take the stream of therace from the racetrack and we add our own
commentator in Randy Moss. He brings in live or taped
interviews from people who are at the track or in the
paddock. We add Eric Wing, who runs a live chat that
goes alongside so people are able to comment
constantly throughout the broadcast and interact with
one another. I=ve been involved in the broadcast on thechat, and we=ve had other guest commentators
involved as well.
Rachel Alexandra and Zenyatta really catapulted thisproject and have drawn viewers from all over the world.
We routinely now see people from 30-40 countries tune
in to watch our broadcasts. I wish I could show you all
the comments. They thank us profusely because
without that web broadcast, there=s no way they would
be able to see that race. Some tracks do webcast, but
most don=t. Providing them with this service has beenhuge. That makes a difference--not only for theperception of Thoroughbred racing in America in theinternational community, it also helps the Breeders= Cupbecause they strive to be more of an international
competition each day. It also gives us here in the U.S. a
broader perspective of what we=re doing, andappreciation of the fact that people from around theworld are watching us every day. It=s been heartening
to see the response and hear the many thanks that
we=ve gotten.

We found ourselves too often unable to broadcast
key races because of rights and monetary issues--it just
isn=t feasible for us to spend the $250,000 it would
take to cover. Now, with this property, we can very
easily turn on the broadcast and produce the show fora fraction of the cost. There are still some rights issues,
but we think it=s the future of simulcasting racing
because of the international opportunities. It=s been aninteresting experiment, we=ve learned a lot and it=s been
worth every nickel that we=ve invested.
What=s the NTRA=s Check-Off Program?
The NTRA=s Check-Off Program is a mechanism for
funding our legislative action campaign. That funding isused to support our federal lobbying, and our legislative
programs. Buyers and sellers at the sales can contribute
1/4 of one percent of the horse=s sell price, which
equates to $2.50 for every $1,000 of the value of thehorse. Over the last 10 years, we=ve raised almost $10
million to fund our lobbying efforts. We=ve been very
successful as a result.
Why should buyers and consignors support the CheckOff Program?
It=s pretty clear that without the NTRA=s presence,
there really would be no united effort for the racing
industry. The NTRA=s voice is unique in that it=s the
only voice out there for horse racing. No one else isprotecting the industry=s interests in Washington D.C.
There are other individual efforts and interests, andthere are other broad efforts for all horses and allequines, but no one else out there is looking out solely
and particularly for Thoroughbred racing.
The beauty of the Check-Off Program is that it=s
broad-based. It doesn=t matter whether someone is inBook 1 or 6 [at the sale]. Those dollars go specificallyand entirely to support the legislative campaign. That initself makes our campaign invaluable in Washington
D.C. Lawmakers hear from lobbyists all the time. It=srare that they hear from the industries speaking with
one voice. That=s why the NTRA has been so
successful, because we are more than just a hired gun
lobbying for them. We are an industry association thatspeaks for the industry with one voice and, as a result,
we=ve been successful.
Are there any extra benefits for those who Check-Off?
One of the great benefits of the Check-Off Program isthat it makes you eligible to participate in the otheraspect of our legislative effort, which is Horse PAC(Political Action Committee). The PAC supports thefederal political candidates. Our legislative action
campaign spends money on lobbyists and on research-that would be what we call soft-money contributions.
The PAC makes hard-money contributions directly to
candidates to support their candidacies. They are twodifferent efforts and both are important. People who doboth are vital to this industry. The Horse PAC hasraised almost $2.5 million since 2002, making it thelargest PAC in horse racing or gaming in America.

In a short period of time, we=ve established ourselves
as players on the national stage through the Horse
PAC. It=s important to keep up those contributions as
well.
You are also eligible to participate in the NTRA
Advantage program [when you support the Check-Off
Program]. You can get discounts on John Deere
tractors, Sherwin Williams paints, etc. We=re adding
new partners daily, and continuing to grow the
program.
How has the recession impacted participation in the
Check-Off Program?
There=s no doubt, we=ve seen a substantial drop since
2006--almost a 50-percent drop in our contributions.
It=s essentially mirrored the drop in North American
sales. We fully understand all the challenges thatbuyers and sellers face in this marketplace.
We haven=t seen a diminishment in the effort, eventhough we=ve seen some significant decline incontributions. We still have over 1,000 people in thisindustry who contribute on an annual basis to theprogram. We still have strong support from all the sales
companies in America--Keeneland, Fasig-Tipton, OBS
and Barretts. People have cut back because of theeconomy; we=ve been able to make up the difference
through our member dues. We all have to be reminded
to be vigilant. And it costs money to be vigilant.
How big of a hit was it to have the four Churchill
Downs tracksBArlington, Calder, Churchill and Fair
Grounds--pull out of the NTRA this year?
Anytime we lose a member, it=s disappointing for us.
Churchill is a big member, so it was a financial blow,
although in the last three years we have moved
increasingly away from dues as our exclusive funding
source. In fact, today only about 30 percent of ourfunding comes from dues. So it wasn=t devastating for
us financially, and we continue to be in contact with
Churchill. They will hopefully participate in our newly
revamped NTRA National Handicapping Championship,
and we continue to accredit their racetracks. I can=t saythat we=ve closed the chapter on that one; it=s still aconversation that=s ongoing.
How much money does the NTRA spend annually on
federal lobbying efforts, and what are some ofthreats/opportunities facing the industry in Washington
D.C.?
We spend about a million dollars a year on ourlobbying efforts. Right now, we=re focusing on two
major threats that are facing the industry. One would
be online wagering. We=re watching I-Gaming, and towhat extent the Barney Frank bill will legalize otherforms of internet gambling that would be competitive tothe horse industry. The Barney Frank bill would subject
us to a new regulatory and tax system, which would
not be good for us--we have to get an exemption from
that. I-Gaming is a major issue that we=re watching
now because as that goes, so does the horse industry.

I=m not sure that it=s going to pass anytime soon, but
we certainly need to monitor it. The second issue
involves Wire Act questions that continue to surface.
Credit cards and processing has been a real challenge
since the implementation of the Internet Gambling
Enforcement Act.
There are some huge opportunities out there, too. It=s
not just about defensively protecting against threats.
We=re always on the lookout for tax vehicles to lower
the capital gains holding period on racehorses from 24months to 12. That=s the way most other investmentsare. There are also opportunities out there to eliminate
the automatic 25-percent federal withholding that major
horseplayers are subjected to. It=s a real difficulty forpeople who hit large exotic wagers in excess of$5,000. We=re trying our best and have a couple ofgood ideas, not only legislative, but also a regulatoryroute for eliminating that 25-percent withholding. We
think we may have one before the end of this session.
With the Bush tax cuts coming to an end, there may be
an opportunity for us. Stay tuned.
Does the NTRA support the National Racing Compact?
We don=t have a formal position on it--we havemembers who support it and we have members who donot. We=ve never taken a vote. We were on the steeringcommittee that helped draft the model legislation andbusiness plan that=s been developed, but we=ve nottaken a position because of the concerns raised bysome of our members.
Do you think that the Racing Compact is gaining
momentum? Where does it currently stand?
It didn=t pass in New York--it=s going to have to be reintroduced. The bill that has now been developed isbetter. I think that the RCI (Racing Commissioners
International) is becoming better organized and thatthey have more of a strategic view of it now. They are
more actively promoting it, too. From that perspective, I
think it has a better chance of passage. There are stillunanswered questions that some our members andothers have--how will it ultimately be implemented andwhether it will result in the loss of state=s rights. Someparticipants, horsemen=s group and others, areconcerned that it could be used as a bully pulpit toforce organizations or states to go along with plans thatreally haven=t been developed by the consensus of theindustry--that=s an ongoing concern. We continue tolook for ways to address those concerns in the way inwhich proposals would be presented to the Compact.
That=s a huge part of where we=re focused right now inmaking sure that horsemen=s groups in particular are
listened to and incorporated into Compact regulations.
Visit the TDN Q&A archive
for a series of in-depth
one-on-one interviews withinteresting figures in theindustry.

A lot of times on major racing days, graded stakes tend
to go off at the same time or overlap. Is there anythingthat the NTRA can do to help organize post times?
Over the years there have been several efforts to dojust that. Certainly there=s more coordination that canhappen. There=s a variety of reasons why things get outof balance. You start out fully attempting not to run on
top of one other, but delays happen. Races aren=t run ina clockwork fashion the way we would like. My 12
years at the racetrack taught me that--there=s a delay
here, there=s a need to hold the windows open for aminute or two there, etc. When you have live animals
as your participants and competitors, there=s muchroom for change. When you have multiple stakes going
off, it makes it more and more difficult to coordinate.
We=re always looking for better ways to do it, but it=s ahuge challenge because of the nature of our game.
Any parting thoughts?
One of the things that we as an organization havebeen putting a lot of energy and focus into is the NTRA
Safety and Integrity Alliance. We believe that it is an
important foundation for marketing and advocacy.
Aside from the fact that safety and integrity are hugely
important to our fans, the people who are watching andwagering on Thoroughbred racing, it=s very difficult tomarket something that doesn=t have integrity. It=s very
difficult to promote or advocate for something inWashington D.C. if you can=t assure lawmakers thatyou=re doing everything that you can to keep yourathletes safe. The Alliance is an important support for
all of the other initiatives that the NTRA does.
Increasingly, we=re finding that having a voice andhaving a platform like the Alliance makes us morecredible spokespersons for the industry, especially inthe event that there would ever be a high-profile
catastrophic injury. As an industry, we can step up andsay that we=re doing the things to address these issues.
Two years ago, we didn=t have much credibility when
we stood up and said, >Trust us, we care about thehorses= safety.= That didn=t work. But today we canpoint toward the Alliance and to the Track
Accreditation process. We could say that we know that
there are 20 tracks out there that are doing the rightthing, there are many more that are stepping up andlooking at ways to join the Alliance, and that theindustry is addressing its problems and not ignoring
them. That goes a long way to solving the problem-doing what=s right by the horse, and also giving us acredible response to our fans and general public whencrisis arrives.
Was the Eight Belles tragedy the lightning rod that got
this going?
It was happening before then. I=d say that Barbaro
was probably the wake-up call to the industry. Barbaro
and his injury created a lot of positive focus on theindustry=s efforts on keeping our athletes safe. Barbaro
was probably the crisis that was the catalyst for a realchange.

It was not until people saw the potential downside to
doing nothing, or at least doing less than all we could
do. It wasn=t until Eight Belles and equally Big Brown,
to be honest. The outcry from the public to the use ofsteroids in our game was probably--according to ourpolling--equally as troublesome as Eight Belles=s
catastrophic injury. We knew we had a lot of things toaddress, and it brought the focus to the Safety andIntegrity issues in ways that we as an industry neverhad before. You had good work coming out of the
Safety Committee, TOBA, Breeders= Cup, etc. There
was a lot of concern at the time about the lack ofstructure in the business and a lot of calls for federal
intervention. We looked at other industries like healthcare, insurance and education who use theaccreditation model to reform their business, and did
the same. It=s worked out very well so far, but there=s
still a lot of work to be done and tracks to accredit.
People are not just saying the rights things, they=redoing them, and that=s exactly what the Alliance wasintended to do.