Hopefuls Hit the Home Stretch in Race for Del Mar Lease

For nearly two decades, the Del Mar Thoroughbred Club has comfortably presided over the annual 43-day horse-racing meet at the famed track, where turf meets surf.

Manned by such notables as supermarket magnate John Mabee, former North County Congressman Clair Burgener and Democratic Party bigwig Robert Strauss, the nonprofit organization has carefully steered the Del Mar track from its scandal-plagued days of the late 1960s to a position today near the forefront of American horse racing.

But that reign is being challenged by two feisty contenders for a new 20-year lease on the track. Both the Ogden-Nederlander partnership and John Brunetti, operator of the Hialeah track near Miami, argue that they could manage the Del Mar facility just as smoothly and deliver far more revenue to state coffers.

Entering Home Stretch

Now the race for the new lease has entered the home stretch, with a hearing before the state commission that will select a new operator set for Thursday at the fairgrounds.

Perched anxiously at the rail are residents and officials of surrounding communities, who say the selection could have a dramatic impact on their lives. In particular, local leaders have chafed at the Ogden-Nederlander proposal, which calls for as many as 40 concerts, ranging from classical music to rock ‘n’ roll, in addition to horse racing.

Buffeted by that prospect, some odd alliances have formed of late. Del Mar leaders, worried that the concerts will cause nighttime traffic and noise, have joined hands with their traditional foes on the Del Mar Fair Board, who worry that the Ogden proposal could erode their jealously guarded control of the grounds.

On Inside Track?

In the meantime, state Finance Department officials have been busy sifting through the proposals, crunching enough numbers to give a supercomputer indigestion in an effort to determine which group offers the best deal. It has not been an easy task. One beleaguered state budget analyst suggested the process goes beyond comparing apples and oranges: “This is like a Waldorf salad.”

Although all bets are off on who will emerge the victor, many local officials say the Thoroughbred Club has the inside track for the lease. Most obviously, the club could benefit from the presence of three Fair Board directors on the state Race Track Leasing Commission, the six-member body that will decide the issue.

Indeed, some Fair Board members on the commission seem to be leaning decidedly toward the Thoroughbred Club.

“Not to sound trite, but why do you change horses if the horse has done a hell of a job for you?” asked Jan Anton, a fairgrounds director and commission member. “I think the Thoroughbred Club has done a good job and their lease proposal is the best in my mind for the state of California. They put all the money back into the facility.”

The commission, which exists for the sole purpose of handing out the Del Mar track lease, was created by state lawmakers in the midst of controversy over the award of the multimillion-dollar track contract in 1966 to John Alessio, a Tijuana racing and bookmaking operator later jailed for income-tax evasion.

Dubbed the Alessio scandal, the affair also resulted in the Thoroughbred Club winning rights to the 20-year operating lease, which began in 1970 and expires next year. By most accounts, the club has done an effective job managing the track, which has seen steady growth through the years.

Power Base

The club has been dominated by some of the most wealthy and powerful men in San Diego County, leaders of commerce and politics who stand for nothing short of success. Among the 10 directors are Burgener, Strauss, North County construction mogul Werner Lusardi and local financier Thomas Stickel.

By most accounts, however, the driving force has been Mabee, patriarch of the Big Bear grocery store chain and a devout horseman with his own 560-acre thoroughbred ranch in Ramona. For 10 years, Mabee has been president of the Thoroughbred Club.

Although the track is rife with lore, among the most memorable tales is how Mabee came to the rescue one day in 1977 when the money needed to open the Del Mar betting widows had been inadvertently locked in a safe with no available key. Mabee put up the greenbacks by raiding the cash drawers of local Big Bear stores.

The challengers point to such stories as proof that the Thoroughbred Club is little more than an aggregation of San Diego County good old boys, men who have grown fat and lazy in the role of running the track, men who have failed to utilize the facility to its fullest extent.

“It’s sort of like the cattlemen’s club on the TV show ‘Dallas,’ ” said one critic, who spoke on condition his name not be used. “They sort of sit around and say, ‘I’ll trade you a grocery store for an oil well.’ It’s an appendage to their personal prestige and personal wealth. I think that was nice and fine in its time, but today you’ve got to look at running this as a business.”

Scoff at Criticism

Leaders of the club scoff at such talk, saying it’s to be expected in these competitive days.

“If these are the kind of good-old boys that have made racing in California a success, then I guess we need even more of them,” said Joe Harper, the club’s general manager. “None of these guys make a cent, not one cent off being a director. There’s no dividends or paid salaries. And, if you call sitting in the director’s room at the track a perk, then that’s what they get.”

Burgener also snorted at the criticisms.

“It’s really not like that,” the longtime state legislator and former U. S. congressman said. “You get to go to the races for free, but, good Lord, it costs a heck of a lot more to get out of the place. I go maybe three or four days a year. A guy like John Mabee is there every day, but he has horses.”

More to the point, leaders of the club say, is the organization’s steady performance in pushing Del Mar from its past, as little more than a hayseed track down in the sticks of San Diego County, to a position as one of the most lucrative and successful operations in the country.

“When we took over the lease 19 year ago or so, the place was run-down and dilapidated,” Harper said. “You couldn’t get a $1-million average daily handle down there. But, by turning the profits back, by letting success foster itself, the track proved to be a winner. Now the average handle is more than $6 million a day. And I think it will continue to work.”

Nonprofit Versus Profit

The track has won the support of groups ranging from the Jockey’s Guild to local homeowners’ associations. Moreover, since it is a nonprofit group, the club does not drain revenue, returning it instead to the operation or to the state, Harper said.

“Ogden is a very successful, very well-run corporation,” Harper said. “They don’t go into ventures without a very clear-cut profit in mind. In looking at their figures . . . it becomes clear that they would take over $80 million out of the facility in profits.

“It’s a good deal for them, and I don’t blame them for wanting to get into that. I don’t think, however, that it best serves racing or the state, and it certainly doesn’t help the local people in Del Mar and Solana Beach, who will have to put up with those concerts.”

But officials with the Ogden-Nederlander partnership see it very differently. Although the company is, indeed, a for-profit operation, officials contend that the Del Mar track can be better utilized by offering the concert series. Under their scenario, revenues to the state would far exceed those expected by the Thoroughbred Club.

Lure of New Grandstand

The group has dangled another inviting plum in front of the Race Track Leasing Commission, promising to finance and build a 20,000-seat grandstand to replace the existing 9,600-seat complex, which is suffering the infirmities of old age. The facility could be built by 1991, with construction performed quickly so that racing would not be interrupted, the group promises.

Officials with the Del Mar Thoroughbred Club acknowledge that the grandstand needs to be replaced, but say that task can be accomplished with publicly issued bonds. (A 15,000-seat grandstand costing about $85 million is in the design stages.) Whether the grandstand is built privately or with public financing, they argue, the money will come from the same primary source--racing revenues.

Nonetheless, officials with the Nederlander partnership argue that, in these days of fiscal uncertainty for the state, only their proposal can deliver a new grandstand.

“In the best interests of the state and the people of California, it’s clear which bid is the best,” said Neil Papiano, a Los Angeles attorney representing the partnership. “There is some provincialism on the part of some of the Fair Board members, who seem to favor the people who have been their friends and associates for a considerable period of time, but the fact is our offer is the best.”

The partnership is composed of the Nederlander Corp., an entertainment firm that operates several theaters in Los Angeles and puts on Broadway shows in New York, and the Ogden Corp., a multifaceted Fortune 500 company that owns a construction company, runs food concessions around the country and has operated several race tracks, including Suffolk Downs in the Boston area and Fairmount Park near St. Louis.

The partnership’s board includes legendary jockey Bill Shoemaker and notables such as Buzzie Bavasi, former general manager of the San Diego Padres baseball team. Papiano breeds horses and was legal counsel to Hollywood Park for 15 years.

Papiano contends that the Del Mar facility has been under-utilized, a situation he would like to rectify by providing an eclectic concert series, ranging from symphony performances to nights with headliners.

“At the peak of the summer tourist season, many people in the area are looking for things to do at night,” he said. “We would bring in the best entertainment, make it the best sort of resort atmosphere, with state-of-the-art facilities.”

Neighbors have balked at the idea of nighttime concerts, fearing a crush of traffic and noise. They point to legal problems the outfit has run into with neighborhood activists around the Orange County Fairgrounds, which filed suit over concerts sponsored by Nederlander.

“I don’t care what kind of concerts they would put on,” Del Mar Councilwoman Brooke Eisenberg said. “It’s just the additional noise, traffic and pollution we don’t welcome.”

Papiano argued that critics are overstating the potential problems. Most of the concerts would draw 5,000 to 15,000 patrons, far fewer than attend the track on a typical weekday and a fraction of the weekend gate, he said.

Moreover, the group envisions few rock concerts, and even the sound generated by those events would require “an incredible set of atmospheric conditions” to reach the ears of nearby homeowners, Papiano maintained.

“We’re not talking about year-round at all,” he said. “We’re talking about principally during the racing season (usually mid-July through the end of September). We wouldn’t do anything during the fair or the Grand Prix.”

The third contender for the Del Mar crown, New Jersey construction magnate and horse racing impresario John Brunetti, does not offer the possibility of concerts, but does promise horse racing--lots of horse racing.

Rod Blonien, a Sacramento attorney representing Brunetti, noted that the net return to the state from the Thoroughbred Club has declined in recent years and argued that a private operator could do better.

Brunetti, who summers in Carlsbad, would accomplish that by offering more promotional days--such as free binoculars, T-shirts or coffee mugs--and by actively pushing the sale of tickets to groups in the region, Blonien said.

He also proposes adding a 10th race to the daily card, a move that would undoubtably add revenue, the attorney said. Finally, Brunetti would try to persuade owners of top-flight thoroughbreds to bring their animals to Del Mar, sparking more attention to the track.

Something of a controversial figure in racing, Brunetti has been involved in a number of squabbles with other Florida track owners over race dates in recent years. Moreover, some critics say Hialeah remains a second-rate facility.

Blonien, however, said Brunetti has performed wonders at Hialeah, taking a track that consistently lost money and turning it into a profit-maker while investing more than $10 million in improvements.

“People can criticize him for being sometimes outspoken, sometimes super-energetic, but no one can question his ability to handle a facility or what he’s done at Hialeah, which is just short of a miracle,” Blonien said.

Brunetti would like to do the same at Del Mar, he said.