Q&A: NTRA’s Rooney discusses U.S. tariffs, Florida decoupling

Before he flew to Las Vegas for this weekend’s National Horseplayers Championship, Tom Rooney found himself shuttling between Capitol Hill in Washington and some horses he owns in Florida.

Hot-button topics have had the focus of the National Thoroughbred Racing Association president and CEO. They include tariffs proposed by President Trump and how they may affect racing and breeding on either side of the U.S.-Canada border.

There also is the controversial bill in the Florida legislature that would allow the Stronach Group’s 1/ST operation to decouple Gulfstream Park’s racing and slot-machine licenses. The proposal that opponents say would sound a death knell for racing in South Florida gets its next hearing Monday in the House commerce committee.

While he was traveling Wednesday in South Florida horse country, Rooney spent a half-hour speaking with Horse Racing Nation.

This transcript includes the most racing-centric parts of the conversation. The full interview may be heard on HRN’s Ron Flatter Racing Pod that was posted Friday.

What does a week in the life of Tom Rooney look like right around now?

Well, it is a lot of moving. Just in D.C. the last couple days, we have some new team members at the NTRA. We lost some to the administration and to the Senate, which we were very proud of them and the work that they did for our industry. We’ve got some good new team members and trying to get up to speed on all things Thoroughbred racing, including most recently the questions that we’re hearing about the tariffs and how that might affect our sport and what we can do about that. That’s what I was doing up there, plus a lunch with the chairman of the appropriations committee in the House, (an) old friend of mine named Tom Cole from Oklahoma, who used to sit across from me at the committee room.

You did mention tariffs. … As fluid as they have been in the early days of Trump 2.0, what can you tell me if there is such a thing as a thumbnail sketch of how this could affect racing?

I think that it is going to continue to be fluid. As of right now we have this April 2 date where some of the exceptions that the President had brought to the table to try to stave off some of the jitteriness in the (stock) markets come to pass. Any kind of exceptions that we’re enjoying in the horse business right now with Canada specifically and breeding and horses moving across lines, we’re still in that April 2 time frame, but that’s going to be here soon. The buying and selling of horses specifically falls into this category that’s not covered after April 2, so it’s going to be a problem unless Trump changes his mind, which as we all know could happen today.

There’s another provision in the United States-Canada-Mexican agreement that Trump did in his last four years, which was sort of like the new NAFTA (North American Free-Trade Agreement). This one deals with horses that aren’t going to be in Canada or the United States for more than a year. So specifically sending a mare up to Canada to breed or sending a mare down to Lexington (Ky.) to breed, is there a tariff on that? Under this section 98 or whatever, technically, there isn’t, as long as they’re not in country for more than a year. For breeding purposes, it looks like it’s OK. But for actual buying and selling of horses where they’re going to cross lines for a more permanent level after April 2, there could be a cost to that that’s added to whatever the cost is now. Everybody throws around this 25%. I think this isn’t playing well in Trump land. He doesn’t like the (stock) markets reacting like this (downward). They’re asking for patience and time, and I just don’t know how much patience and time he’s going to give. We’ll see. If you’re buying and selling, it could be a problem. If you’re breeding, it looks like you might be OK.

It sounds like we may get some clarity, if there is such a thing, in less than three weeks.

Yeah, April 2 is the time where these exceptions or the delay that he put into place is over. Unless he makes another exception to push that out again, there’s going to be a tariff or a tax on actual buying and selling of horses along with a lot of other animals and things like that. But who knows? I’m getting the sense from people that I talked to that some of the things that were said on the Sunday talk shows, they use tariffs as an as an excuse for trying to crack down on fentanyl, or using tariffs as an excuse to get people to the negotiating table. It’s not necessarily the tariff for the sake of actually raising money, per se, but actually to do what Trump does and try to make deals. If that’s the case, you might not see any of this happen. Right now, we’re in that gray area of trying to get to the table to make the deal, but there’s still this kind of tax or tariff sitting out there that’s going to affect people’s lives.

Speaking of affecting people’s lives, there is everything that’s going on in Florida in general and South Florida in specific with the decoupling proposal that is now being considered by the Florida legislature. Your back yard. ... This is really in your wheelhouse. Do you feel a little more pressure or maybe a little more of an advantage that you can get something done to prevent this decoupling measure from passing?

Both. I’m heading out to Payson Park here today. I have a colt out there. There’s a lot of people that work at Payson Park, and that’s probably the smallest of the training centers around this South Florida area. You’ve got Palm Meadows, you’ve got Gulfstream, you’ve got a lot of places that people don’t really understand how much this is going to affect not just the fact that there might not be racing here but a lot of people’s lives and jobs in Florida. That transcends up to Ocala in Marion County with breeding operations. I have two mares right now that are going to Ocala Stud to get bred. Is there going to be an incentive program or bonus program in Florida when they hit the racetrack? These are all the questions that we’re trying to figure out. Of course, you still have Tampa (Bay) Downs. They are still negotiating with the with the Stronachs, with 1/ST, to see if there’s some kind of alternate plan.

But in the end, Ron, if somebody owns a piece of property, and they want to get rid of it, that’s the American way. Everything’s for sale. The only thing that’s different here is that part of the bargain that racetracks made in Florida and elsewhere was that they lobbied hard for slot machines. They got them. The condition was that they have a live performance in horse racing, and now they want to go back on that deal. There’s got to be some give and take for that. If the legislature is going to let (1/ST chair Belinda Stronach) leave racing in Florida, racing’s got to get something out of that. I don’t know what that is, but I have been talking to my friends that are up in the legislature.

I have talked to people in 1/ST. I understand their position. I didn’t like the comments that were made on NBC about horses not liking to race in urban areas. That’s not necessary. If we’re going to try to figure out a solution to Gulfstream, that’s one thing, but that affects a lot of people across the country that own racetracks in similar situations. By the way, there’s no empirical data that supports that. That’s just an opinion. But anyway, I digress.

I believe that in the end, the legislature wants to allow for somebody that wants to sell a piece of property like that to do so. The legislature down here in Tallahassee is dominated by Republicans, but at the same time they recognize that there was a deal made. There’s a lot of money from the revenues of the slot machines that go into things like purses. The big question is if (the Stronachs) are able to leave racing, what does that say about Tampa (Bay) Downs, and is there a possibility for another venue somewhere else in the state to pick up the slack when Tampa goes dark after the (Kentucky) Derby? They go dark in summer. For people like me that are small-time breeders that have horses that need to get the bonuses for racing in Florida, going dark from May until October and the Breeders’ Cup is a problem unless they’re going to pay bonuses if we race out of state. I don’t know that they can afford to do that.

We’ve got a lot of good people working on this for us. We certainly have to be sensitive to the fact that 1/ST Racing is a privately owned company. They have Santa Anita as well. They divested Pimlico, so to speak, to the state of Maryland. It’s clear where the Stronachs are, except (patriarch) Frank came out (Tuesday) opposing decoupling. That wasn’t all too surprising.

It kind of caught people on their heels as far as not really expecting that this would happen this year without some kind of a negotiation with (1/ST) to figure out an answer. The only thing that people can do in response is try to kill that bill. I think that based on my conversations that the bill as is might not be completely accepted. But in the end, if somebody wants to sell their property, it’s really hard to stop them from doing that.

I was going to ask you about the disingenuous language that we heard from the proponents of decoupling during the subcommittee hearing on Feb. 5 and the fact that Republicans voted en masse for decoupling, and the four Democrats on the committee voted against it. Maybe all these are side issues. Do you believe, Tom, just in terms of your talking to whether it’s the Stronachs or folks who are tied with them or even the legislators who’ve dealt with them, that this is a fait accompli?

No. It may have been at that subcommittee hearing, because I don’t think that the people that were asking those questions understood the reach and the gravity of what they were talking about. I talked to those guys that asked those questions, because some of them were from around my area that I’ve known for a long time. I’m like do you realize that when you say that, the actual truth is this? To every one of them, they didn’t know that. That’s why from just strictly strategic game planning, the Stronachs were very good about getting out in front of this without letting anybody else know that this was their plan. If anything motivated those that opposed decoupling quicker and more emphatically, it was that subcommittee hearing once that got out, to get to Tallahassee and to educate the people that matter as quickly as possible. You haven’t seen that kind of language since then, I think you’ll notice.

But even beyond that, is it a case where the Stronachs could simply just take their ball and bat and be done with it?

They could. Of course, they could do that tomorrow as they said in their meeting with their horsemen group down there. That would under the law right now, though, require that they’re not allowed to have slot machines, either. That’s a huge revenue generator for them. In a perfect world, if they could get rid of racing and develop that property down in South Florida, the urban area that it is in, and then have slot machines, too, that’s a huge win-win for them, and it’s a loss-loss for racing.

We’ve been just trying to be fair and tell the legislators up in Tallahassee what the actual reality would be, not just for Hallandale Beach but for Tampa, potentially for Palm Beach County with Palm Meadows, Martin County with Payson Park, with Marion County and Lee County with the breeding operations up there near Gainesville. I mean it’s thousands of jobs and millions upon millions of dollars for one thing, and that’s just to allow somebody to break the deal that they made, which was to have live racing for the slot machines.

(It’s) something that quite frankly concerns me, because that’s the deal that a lot of states have. I’m very worried about the precedent here, so we’ve got to get this right without sounding like it’s punitive toward somebody and wanting to do something with their property. That’s not it at all. It’s just the fact that you know what the actual effect of this is. Why we have this in place to begin with, what the deals were made originally and agreed upon and how that precedent may affect racing in other states let alone just having a winter home for racing in Florida. I’m not even getting into Santa Anita, because I don’t pretend to know.

The one thing that’s comparative to California, though, is the huge presence in both states of the Indian tribe that has a lot of influence over the legislatures in both states. The Indians would not disagree with the fact that if there was no other form of gambling in their state besides Indian gaming, they would be happy. The fact that the Indians in Florida, the Seminoles and the Miccosukees, are staying out of this fight is kind of interesting. That’s the reality that we have in Florida and California that a lot of other states don’t have to worry about that. It’s a huge problem for Thoroughbred racing in Florida that that’s also a consideration.

You know better than I that Florida’s got a lot of hot-button topics on the political table. Horse racing probably isn’t in the top 10, maybe not even in the top 100. How do you get those legislators to care as much as we do about this?

It’s personal relationships. It’s telling them exactly what this means for me and my horses. It’s what it means for the history of racing in our state. A lot of the people that are in leadership are more on the pro-agriculture side. You make sure they understand that part. Typically what you have is a lobbying effort, and there are people down there, like (former state Senate majority floor leader) Damon Thayer has come down from Kentucky to help out, and then you have your hired lobbyists and stuff like that. I think in the end, having personal relationships does matter just to be able to tell the story of why this is a problem.

But you’re right. If you read some of the political rags that deal with politics on a daily basis, I haven’t read one word about this outside of our sport. I think that’s probably a good thing. We don’t need to be part of some political football. I’d rather have this settled by the two parties agreeing on a solution and moving on rather than it becoming something bigger. Sometimes issues like this can become a political football, and then you’re being used as a tool for something else, and I don’t think that that’s healthy. I don’t think that’s good.

Let’s talk about something that is. The National Horseplayers Championship. Is this your third or fourth?

This is my fourth.

What do you look forward to most going out there?

For me, not ever being out there until I took this job and walking into that room and seeing just like how big it is and how exciting it is, especially before the final day when everybody’s still in it. It’s just a lot of excitement in that room. You have hundreds of people in that rooms screaming at the big-screen TVs and cheering for their horse. But also recognizing how poor of a handicapper I actually am. When you actually watch people and what they’re doing and what they’re considering, it’s really the science of playing the horses, so to speak. It’s something that’s eluded me. I think that I know what I’m doing, but then you watch them, and they throw out horses that I like, and they’ll tell you why, and you’re just like oh, yeah, well, that’s true. Our team puts on such a great production. (NTRA senior vice president) Michelle Ravencraft and (marketing director) Holly Short and then the whole team, they just do a great job making that a special weekend for a lot of people that love to play the horses on an annual basis. The prize of being really good at it, at the end of the day to come to Vegas and potentially get almost $1 million. ... It’s very exciting.

It’s another thing that that we like to celebrate in the NTRA. We just had the Eclipse Awards, which is sort of the best of the best of the athlete, the jockey, the trainers, the owners. But then this one also is an Eclipse Award winner for the person that can handicap the best and can play the horses the best. It’s sort of like another element of our sport that we love to recognize. If we didn’t have horseplayers, it would be pretty difficult to run horses, so I love it. It’s a great weekend.