MINUTES OF THE CTBA BOARD OF DIRECTORS MEETING
AUGUST 16, 2000
DEL MAR RACE TRACK EXECUTIVE OFFICES
DEL MAR, CALIFORNIA

I. Directors Present:

Barr, John
Boots, Clydene,
Burge, Douglas
Canty, Jeanne
Card, Keith
Fitzpatrick, Weston
Harralson, Daniel
Harris, John
Howard, Leigh Ann
Johnson, Myron
McCaffery, Trudy
Meagher, Dr. Dennis
Pashayan, Suzanne
Rogers, Joan
Vessels, Frank

Directors Not Present:
Liebau, Jack

Others in attendance:

Murphy, Jim, Chief Financial Officer of the CTBA

II. Time Convened: The meeting was brought to order at 10:05 am.

III. Approval of Minutes: 

The June minutes were approved as submitted. No meeting was held in July.

IV. Special Election:

A special election was held to fill the vacancy in the office of Secretary resulting from the death of Edwin Gregson. After two ballots in which votes were tied, Suzanne Pashayan and Joan Rogers were elected as Co-Secretaries.

V. President's Report:

A. Acknowledgements: The chairpersons of the month were acknowledged, Doug Burge for his work on the Del Mar Sale, and John Harris for his work on various legislative issues, especially A.B. 2760. 

B. Facilitated Meeting on Promotion and Sales of Cal-Breds: Wes Fitzpatrick reviewed the August 1 facilitated meeting on Cal-Bred promotions, primarily the desirability of a second sale for non-select yearlings. The facilitator, Don Gertsman, reportedly did an excellent job in managing the diverse positions and assisting the group in reaching a conclusion. Most of the invitees, some 30 people, attended, and the concept of reaching out in this way to the membership was evidently well received. While there was interest in expanding to a second sale, it was agreed to wait to make the decision until after the August 2000 sale.

C. August Sale Results: Doug Burge reported that the sale average was the fourth highest in history, and the highest average for a sale with such high numbers of horses. Doug Burge also reported that the newly designed showing areas had been well received, and stated that a second, high- quality restroom facility had been placed behind the barn area. In addition, he reported that there had been further negative comments about the food service. There was general agreement that further publicity for the single sale would be appropriate, and Dan Harralson suggested that invitations be sent to selected buyers. Action Item: Doug Burge is to direct the CTBA staff to put together a data base of various criteria, measuring them against the final sales prices for the most recent sale and the last two prior sales. These criteria were to include, but not be limited to: conformation scores, highlighting those yearlings that scored 6 or above; pedigree price estimates; availability of radiographs; and number in the sale. The result of the project should be a report to the Board on the findings.

VI. General Manager's Report:

A. Del Mar Sale Results: The Del Mar Select Yearling Sale held August 15 and 16, 2000, took up most of the general manager's time this past month. The results were as stated in 5 (C) above. 

B. Repository: Over 50% of the entries were represented by x-rays in the repository. Horses without x-rays in the repository failed to obtain high buyer support. The x-ray processor acquired for the sale smoothed matters for on-site vets and buyers who wanted x-rays taken at the sale. 

C. Satellite Broadcast: It was pointed out that the graphics on the screen did not keep current with the picture of the horse being sold, so there was room for confusion and error. The satellite hook-up made it possible for convenient coverage by TVG.

D. Internet Catalog and Broadcast: There were 175-200 accesses on the CTBA website to review the catalog, and 400-500 viewers on the internet during the sale.

E. Profitability: Net profits could be as high as $130,000 to $140,000 (budget had anticipated $88,000). Nomination fees and entry fees were also higher than expected. Expenses increased approximately $30,000.

F. Need for Graduate Statistics: John Harris expressed the view, agreed to by others, that the sale lacked energy. It was thought appropriate and useful to have solid statistics on the performance of sale graduates to use in advertising next year's sale and in reporting to breeders on the success of selections. Action Item: Doug Burge is to report back to the board on this topic.

G. Upset Prices: The agreement among various sales companies to keep upset prices high enough to shut out killer buyers was discussed. MOTION: The CTBA shall join other sales companies in establishing a mandatory $1,000 upset price to prevent activity from killer buyers. Motion by Dan Harralson, seconded by John Barr. Passed 14 for, none against.

H. Inspections: Consignors continue to complain about various aspects of the inspection process. It was thought that more specific reports needed to be provided to those nominating yearlings, for the purpose of clarifying the selection process and educating breeders. Videotapes were made at the Bay Meadows Sale on pedigree selection (Don Engel and Leigh Ann Howard), and the shooting of a tape of Richard Matlow inspecting yearlings is planned. It is also thought by some that breeders should be given written score sheets at the time of an inspection. The use of a score sheet will be investigated by the sales committee.

The board discussed revising the inspection and selection process, including tightening pedigree requirements, using computers to tally conformation scores from several judges, discarding the highest and lowest scores, and importing agents and industry experts from out of state. It was pointed out that some members feel that board members' horses are given preference in the selection process, and while the boardmembers do not feel that to be the case, they want to establish a process that would eliminate that perception.

I. 2001 Sales Committee: Wes Fitzpatrick recognized that due to the untimely death of Edwin Gregson, the Sales Committee needed a new chairperson, and asked those interested in chairing or participating in the 2001 Sales Committee to submit proposals to the president.

VII. Treasurer's Report:

A. Audit: Treasurer Myron Johnson reported that the auditing firm of Price Waterhouse, et al., had reviewed the financial reports and found them in good order. 

B. Trends: Both revenues and expenses were trending up as reflected in the six-month activity report.

C. Incentive Award Advances: Myron Johnson has been reviewing the staff and equipment capabilities for paying incentive awards twice a year. MOTION: The CTBA shall pay to breeders on or around October 1 of 2000 an advance of an amount equal to 10% of the total eligible purse monies earned up to June 30. (It is anticipated that this amount will constitute about 2/3 of the total due for that time period.) Motion by Suzanne Pashayan, seconded by Leigh Ann Howard, passed, all in favor. If this program works well, it will likely be carried into the future. It is noted that the stallion awards cannot be included in this advance payment because stallions leaving the state would become ineligible. Action item: Doug Burge was directed to arrange for the said incentive payments.

D. Credit Checking: The credit approval process at the August sale appeared to work well, and Jim Murphy has access to a number of professional tools, including on-line connection to Experian, to speed the process. One applicant was denied credit. Auctioneers and the Santa Anita paymaster were among those asked to vouch for applicants, and questionable applications were reviewed by a committee established for the purpose. The name of the person vouching for an applicant was noted.

VIII. Education/Communications Committee Report: 

A. Harris Ranch Seminar: Leigh Ann Howard reported that the educational seminar at Harris Farms will be held on Friday and Saturday, September 22 and 23. The general topic is "Raising Better Horses," and experts are committed to speak. It is hopeful that the dinner speaker will be Frank Stronach, but a backup is in place if he is unable to make it.

B. Nor-Cal Stallion Tour: Bill Nichols is hosting a Northern California stallion tour on October 21. The Board wants to acknowledge and thank Bill Nichols for his ongoing efforts and cooperation in arranging tours in the North.

C. Cal-Poly Career Day: Cal Poly is holding a career day in January, and recommended that the CTBA attend. It is of concern that the Cal Poly equine program does not prepare students for work in the racing and breeding industry, and our participation is considered important to educating the school and the students about the industry.

D. How-to-Use Website Article: An article in the CTBA magazine on how to use the CTBA website and industry forum appears to be needed, as the forum has been slow to catch on. 

IX. Legislative Committee Report

A. John Harris expressed concern that the current version of AB 2760 would have a negative effect on the industry, and stated that the Teamsters were now opposing the bill. The bill as currently worded permits the SEIU to have cards signed by workers, with no election, and to force trainers to negotiate as a group. It is unclear and flawed, and moderate democrats oppose it. In contrast, AB 1405, the account wagering bill, is thought to be beneficial to the industry and sorely needed. Both bills are expected to come to vote within the next few weeks. Representatives should be contacted.

X. Other Committee Reports:

Because of the extent of the discussion on the August sale, there were no other committee reports made.

XI. Time of Adjournment.: The meeting adjourned at 1:25 pm.


MOTION SUMMARY:

1. Establishment of mandatory $1,000 upset price: Passed.
2. Payment of advance on incentive awards: Passed.


ACTION ITEM SUMMARY:

1. Doug Burge to direct staff to put together statistics comparing specific sales yearling selection criteria to sales prices, and prepare report for the Board's review.
2. Doug Burge to report on availability of sales graduate racing statistics.
3. Doug Burge to arrange for incentive payments as agreed by October 1, 2000.

Suzanne Pashayan and Joan Rogers, Co-Secretaries.

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