Keeneland boss explains why she now accepts fed regulation

Tucson, Ariz. 

Consider Shannon Arvin one of the converted. Someone who resisted the idea of the Horseracing Integrity and Safety Act long before it ever was proposed. Long before it was signed into law.

“If you had asked me 20 years ago, do I want to turn over our sport to the federal government? I would have said no way.”

That was what the first-year president and CEO of Keeneland said last week at the University of Arizona’s Global Symposium on Racing.

Asked later in an interview about a light-bulb moment that changed her mind, Arvin said there was not just one.

“We were doing the same things over and over again and expecting to get a different result,” she said. “It just wasn’t going to happen. It didn’t matter how good the rules were and how sound the rules were that we all agreed on. There was no enforcement mechanism – absent agreement by all the parties, which was very unlikely – or federal government intervention. That was when I realized, OK, we’re never going to get past this finish line onto a better phase of our sport without federal government intervention.”

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The finish line may be in sight with a scheduled enactment July 1, but HISA is not there yet. Not only are proposed rules in constant flux, there is still resistance and even legal action from state racing authorities and horsemen’s groups to one-size-fits-all regulations. Drug and safety reforms that are acceptable at Arvin’s home base in Kentucky have not gained support in less lucrative racing states.

“I don’t know if it’s going to wind up in court or not; that’s up to them,” she said. “I certainly hope we can sit down in a room and find a way to make them comfortable.”

Arvin did not rule out the idea of having different rules to accommodate the budgets of smaller racetracks, but not at the expense of guaranteeing a safer sport.

“There maybe should be some baby steps in raising everybody to the right level,” Arvin said. “There has to be a baseline of an acceptable safety standard, certainly, but I think there’s a way that we can get there so that the tracks that are really doing the right things and have a safe environment for horses to continue to operate.”

Therein lies the bottom line. Money. One of the ongoing riddles of HISA is who will pay for it. HISA board chairman Charles Scheeler admitted last week he did not have that answer largely because no one knows yet what the enforcement program will cost.

“Once we finish up with (the U.S. Anti-Doping Agency) and know exactly what the parameters of that program are going to be, then we can cost it out,” Scheeler said.

Arvin said she understands the need to build the enforcement framework before setting the price. She also expressed concern about how that will play out.

“There definitely is fear of the unknown,” she said. “I have that, too, because the regulations aren’t quite where they need to be yet. There are still some areas where I feel uneasy, but I’m grateful for the people that are contributing a lot of their time and energy to figuring it out. I think we have the right people involved.”

If there is one thing about HISA that Arvin does not fear, it is the newness of it. At 46, she is one of the youngest racetrack bosses in the country. If there was a meme that she left with last week’s symposium, it was when she said, “I’m tired of the narrative that this sport is dying.”

Arvin said she wants her Keeneland team and the whole sport to expand its presence in social media, sports betting and even non-fungible tokens.

“People are paying over a million dollars for skins from Asia,” she said. “That’s such a surreal topic to me. We have to look at it, because not only is there a serious potential source of revenue, but there’s also a much broader audience out there to whom we could introduce our sport.”

Where NFTs of Secretariat’s mane or the historic Woodlawn Vase still might be a difficult concept for mainstream grasp, sports betting is not. Although Kentucky is one of the 20 states yet to legalize it, Arvin believes it is inevitable everywhere.

“With sports betting, it’s not a matter of if but when,” Arvin said. “At some point our legislators in Kentucky will see that we’re not stopping people from participating in sports betting by not having it be legal. We’re just stopping ourselves as a state from getting the revenue from it. It is such a tremendous opportunity.”

Cannibalization may not be an age-old question, but it has been a constant for racing since the U.S. Supreme Court struck down the national ban on sports gambling in 2018. There is the idea that it is a zero-sum game, which would mean something has to give when horse betting is integrated into it.

“We just have to figure out our spot,” Arvin said. “The (symposium) spent a lot of time talking about fixed odds vs. pari-mutuel wagering, and what’s the pricing? The truth is we just don’t know right now. We have to get in there and start negotiating with the sportsbooks that would be representing us. I don’t envision that Keeneland itself would start a sportsbook. It would be our content that would be available on the sportsbook. I just I think that it’s a foregone conclusion to me that that’s the direction we’ll head. We just have to be smart about it.”

Arvin even said a long-held criticism of racing could be spun into an advantage.

“They’ve said, ‘Well, it’s two minutes of action, and then 35 minutes of nothing,’” she said. “That’s really an advantage in sports betting.”

Come New Year’s Day, it will be one year since Arvin became the first woman in charge of Keeneland Racing and Sales.

“When I first came on, actually, I looked at our P.R. people, and I was like, do I have to answer that question?” Arvin said. “ ‘Yes, you do.’ I understand why it’s important. I hope first and foremost I’m the qualified and right person for the job at this moment in time. I think we’ve accomplished a lot. I don’t take the credit for much of it other than finding the right team to put together, because I think together we are doing a lot of fabulous things to help move our sport forward. I truly think we are rowing in the same direction and understand people’s energy and zest for fun.”