Q&A with FTBOA President Phil Matthews
The Florida Horse magazine editor-in-chief Brock Sheridan recently had a chance to sit down with FTBOA President Phil Matthews and discuss some of the changes we have seen during his tenure at FTBOA and what opportunities and challenges Dr. Matthews feels may lay ahead for the Association.
TFH: Before we get started, most people know you as a veterinarian and businessman, but tell us about your history as a thoroughbred breeder.
PM: I believe I bought my first mare in 1983, a Great Above mare that went on to produce several black type horses including a Grade II filly named Parlay. As Cedar Grove Farm, my wife and I have been very fortunate to be able to produce several stakes winners including another Grade III winner Rizzi’s Girl and a Grade II-placed horse, Papi Chullo that won several other stakes. I’ve participated in every part of the game from sales at all ages to racing. It’s been exciting.
TFH: What are some of the things that have transpired during your year as FTBOA president?
PM: Wow, a fast year. Looking back, I guess what stands out the most is all of the transitions that have taken place over this year, which necessitated a huge time commitment but have also energized me due to the potential these transitions have meant and will mean to the Association. Mr. Hancock left after twenty-two years and then Lonny Powell came on board. Mike Compton left as editor of the FEP [Florida Equine Publications] and we brought you [Brock Sheridan] on board. We’ve also been very serious about transiting to a more dynamic IT and financial reporting system that has taken a lot of time and effort. This system will not only make us more secure and efficient but hopefully will provide some membership added value features that the association has not enjoyed before. A lot of this transition was started by Fred Brei and then continued by me, seeing them through to fruition.
When it comes to facilitating and implementing changes and forward progress everything moves more slowly than you’d like, certainly more slowly than Lonny and I would like. But that is life. We started in a little deeper hole in terms of the existing technology more than even we had envisioned. And listen, that’s not a commentary on the past. It wasn’t a focus for Dick [Hancock], being a little more old school and prioritizing different things, but Lonny and I thought prioritizing some modernization was very important at this juncture.
One last thing about looking at the past year; it has been a delight to work with the Board of Directors. They have volunteered time, energy and brain power that has been a pleasure to be a part of. And I can’t say enough about the staff of FTBOA; tremendous. All hard working and very dedicated.
I’d like to give an additional shout-out to our officer team-Brent [Fernung], Francis [Vanlangendonck], Bonnie [Heath] and Sheila [DiMare] by the sheer responsibilities of being an officer and executive committee member they really had to step-up during the transition. I must give special kudos to Brent, who in the role of First VP has taken his role very seriously to provide some excellent support and counsel to both Lonny and I.
TFH: You’ve mentioned how fast this year has gone and some of the many accomplishments of the Association. To what do you attribute your fast start as president of the FTBOA?
PM: I mentioned the significant transition. Well Fred got the ball rolling. The first thing he tackled as president was to provide more financial and accounting expertise which involved bringing Caroline Davis on board. She has a wealth of experience in the world of financial management and understands completely the necessity for security, accuracy, checks and balances, etc. She has done a terrific job.
Fred also worked hard to address complaints coming from within the association. Several things were changed as a result and in other instances the correct information had to be provided because there was a plethora of misinformation. He, and the Board at that time, took the mindset of moving forward and progressing rather than just maintaining the status quo. It took a tremendous time commitment on Fred’s part, much more than any previous president. In fact, I think it is fair to say that Fred raised the bar for all future presidents to be more engaged and commit more energy than was traditional with this office. And again, that is not a commentary on the past people. I think all of us should be very grateful to anyone that has served as an officer or board member and given of their personal time and energy.
A last comment on Fred, if I can. There was some criticism of Fred’s approach to revitalizing racing in Florida. That there was too much concentration on stakes supplements. Something that apparently escapes people on this subject is that the more we improve the live racing product in Florida, the greater the handle, both live and simulcast as well as local demand for Florida-breds. It is the handle—our percentage of it—that creates breeders’ awards. We need a strong racing product for Florida, for our breeders as well as our owners.
TFH: What does the nine month report card on CEO Lonny Powell look like?
PM: What the search committee saw in Lonny was a person that wanted to move forward and keep moving forward, someone with vision and a proven record as a top executive. What I saw in Lonny was someone that had an amazing breadth of experience within the thoroughbred industry and was not only well acquainted with the workings of the business but knows most of the players both in Florida and throughout North America. The thoroughbred breeding and racing world is very unique with many nuances. I was very pleased that we were able to find someone that knows it backward and forward.
I’ll digress briefly on this point. There were several names that were brought to the search committee during that time, and a couple of them had strengths in one area or another that were more specialized than Lonny’s in that particular area. But no one came close to bringing the complete package like Lonny. I thought it was very important then and feel that we have been well vindicated by our selection ever since; because now I have seen firsthand how many moving parts there are in his position. It’s incredible really; and it helps so much to have someone that has had a lifetime of experience and success weaving through those relationships; and mine fields in a positive fashion.
You see we aren’t in a bubble. I think a small portion of our membership believes that all this association needs to do is distribute breeder’s awards. It is very important that we communicate with, work with, negotiate and lead when necessary with, all of the players with stakes in this Florida industry. That means the race tracks, the HBPAs, the ADWs, the legislature, the Florida Department of Ag, Marion County, City of Ocala, the Thoroughbred Retirement Foundation, the American Horse Council, and on and on. If we don’t have a seat at these tables and we don’t press for our concerns on all levels, we become weaker. Lonny’s ability to hit the ground running on all of these fronts has exceeded our expectations.
Lonny gets all that and knows how to work in that world. He also has considerable CEO experience that makes him a good administrator. He is an enthusiastic team builder. He puts people in a position to get the most out of them and creates an environment of support and empowerment in which they can flourish. That translates to an efficient, competent and accountable staff that gets things done for the Association. As a business owner, I understand the importance of strong corporate culture. It is paramount in making a business successful. Lonny understands this to the tee.
TFH: How do you see Florida Equine Publications now and in the future relative to the FTBOA?
PM: I have always thought that the need for a public relations arm to be so necessary. We are fortunate to have a staff that produces a great product, a product that wins awards year after year. What FEP produces accomplishes a lot of things for the FTBOA, most notably helping ensure our relevance to the rest of the world, both within and outside of the industry. The web site, The Florida Horse, the Wire to Wire give our members a source in which to advertise their products, to help get their stories and accomplishments told, to keep up with the industry changes and news, all of these things.
An important point that I think is always worth reminding people of is that without FEP we would be outsourcing any public relations and marketing efforts. This way it is done well, under our complete control and by people that understand our needs and purpose. And as it stands, FEP is a profit asset for the FTBOA.
TFH: Would you like to touch on the recently announced supplement bonus program that is now in its second year?
PM: I’d like an opportunity to clarify if necessary the supplemental bonuses. The bonus affects awards received during the 2011 calendar year. Anyone that received a bonus during that year will get a check for an additional 11%. To make the math easy, if you received $1000 in 2011, you will receive a check for $110. From a pure blended percentage standpoint we are now at the highest level in our history-and we hope to continue this upward trend in the future It’s also expanded to pay bonuses for first, second and third place, meaning more bonuses than before. Oh, and one more thing, those checks should be sent out by mid-October at the latest.
TFH: You’ve talked about maintaining healthy, live thoroughbred race dates in Florida; will Marion County be a part of that formula?
PM: Yes, the FTBOA created OTR [Ocala Thoroughbred Racing] for the express purpose of converting the quarter horse permit to a thoroughbred permit. This was accomplished in August. It has been the opinion of the board that we need to do whatever we can to ensure racing, and as many racing dates as possible, to exist in Florida. This was seen as a tool in our tool box toward achieving that goal. It is a tough mountain to climb, but I assure you that OTR is pushing hard to make racing available to us in Marion County. And the type of racing venue we can be proud of that will support the bottom line of owners and breeders through purses and breeders awards, as well as create even more awareness and relevance with the public.
TFH: It’s been widely reported that pari-mutuel barrel racing is a significant threat to thoroughbred racing and breeding in Florida. Can you expound on this threat?
PM: This is certainly a topic that is paramount on my mind. It gets back to what many of us feared from the advent of racinos around the country and slots and card rooms coming in to Florida. It has always loomed as a double-edged sword. They were seen as a savior for racing because of the boon it has been to purses and breeder’s awards. But many of us were waiting for the next shoe to drop, when some tracks figured a way to have their casinos, and slots, but not have the investment and demands of live racing at all or curtail it significantly. That is exactly what is happening with barrel racing. These barrel racing rogue permit holders are trying to create a venue by which thoroughbred racing can be eliminated. They pay very small purses, have a very small number of horses to provide space for and still qualify for their other forms of more lucrative gaming. It is an ugly thing that is happening.
I want everyone to realize two other points that are very important about this diabolical process. These people are doing everything they can do to delegitimize the now legitimate, and traditional, horsemen’s groups. That is the FTBOA and the FHBPA [Florida Horsemen’s Benevolent and Protective Association]. We have always been the groups that the racetracks had to enter in to agreement with for breeder’s incentives and purses. Gretna wants to create their own “cozy” horse groups, basically run by them, which they will supposedly negotiate with, and by doing so cut us out of the process. And I don’t mean the barrel racing process, I mean Thoroughbred racing!
The second point I want to make is this. Where have the race tracks been on this issue? The silence has been deafening. They don’t visibly take a stand but they are just waiting to see what happens. As one high ranking racing official said to me, “Hey, we like it. We like the flexibility it could provide.” This should send a chill down the spine of any individual or organization truly dedicated to live thoroughbred racing in Florida.
TFH: What do you see as some of the larger challenges and opportunities ahead for the FTBOA?
PM:I think our members create and provide many of their own opportunities by breeding great horses that continue to consistently and successfully compete on a world stage. We should all be incredibly proud of the product that is turned out by the people of this state. We need to work as an association to protect the past achievements and continue to strive for more. We need to work toward an equitable solution with Advance Deposit Wagering and to have a seat at the table when destination resort casinos become a reality, we need to be able to produce quality and economically rewarding racing in Marion County as the other tracks contract their dates as they are trying to do.
The challenges are many. The economy may be our greatest challenge and one that we have the least control over, so we must focus on those that we can influence. I’ve already mentioned the barrel racing debacle. I mentioned ADW as an opportunity, which ultimately it will be, but in the meantime it is a struggle, certainly a challenge.
You know, unfortunately, there is a long list of challenges to our industry. That is why strength, vibrancy and relevance need to be key focal points of this association. We are and must be more than “just an administrator of Breeders Awards.” It is our responsibility to also lead, facilitate, advocate and otherwise promote the Florida thoroughbred industry.
Brock, let me digress for a minute.
There are many in our membership who speak to one topic only; increasing our breeder’s awards. On one level, I think that is fair, it should be a major priority. The higher they can be the better. Who in their right-mind would ever think differently? It allows present breeders more potential to get more money and it provides added incentive for more people to come to Florida to breed their horses.
So what I think a major challenge is; is to educate our membership about how that can happen. As I said, we don’t exist in a bubble. We are a very unique industry that few people understand and, unfortunately, fewer are embracing every year, referring to the fan and owner base. So let’s couple that with where the money comes from. It comes from the handle and the slot machine and card room revenue at the racetracks. Therefore, it is absolutely imperative to protect these sources; our only sources of income.
To do that, we need relevance. We need to be relevant to the legislature. We need to show them on both a professional and unified basis that we are a large and vital part of the economy in Florida and that we are a significant grass-roots voting bloc. So that we can persuade them that we need help with immigration, taxation, workman’s comp law, ADW, awards flexibility, etc. We need to be relevant to the state, to the people of the state, so that they see us as a vital industry, not simply the sport of kings or a rich man’s hobby as so many perceive We need to be strong and relevant to be able to negotiate with the other stake holders in the industry, negotiate positions that preserve racing dates and as strong a percentage of handle and other revenues as possible toward our trust fund, our breeders’ awards, purses and our future.
It is this relevance that is so important. I would argue it is more important now than ever. Gretna and other gaming interests want to claim we are irrelevant; that our time has come and gone. They want to write us off as being unable to get beyond the in-fighting; that we shouldn’t have a place at the negotiating table.
To counter this and achieve our goals we need to be the whole package. Good legal counsel, good lobbyist, strong and savvy CEO, hardworking board and officers and a unified membership. This is how this Association protects and forwards the interests of its members.
We must do all of these things. I’m afraid it is naïve and totally unrealistic to think that the FTBOA should consist of a bean counter in the back room that reaches in to a pot of money and sends out breeders’ awards. The pot will quickly dry up under such limited vision. There are people working very hard, every day, through their selfish interests, trying to dry that pot up. Many of our members realize this and are enthusiastic and focused on moving forward in a constructive, unified manner.
That being said, we continue to make the area of membership services and education a major focus of what we do and something that Lonny, myself and the FTBOA staff are excited about building upon. We also believe that it is very important that the board and management continue to be proactive as we look down the road. Toward this end, I am working with Lonny to have a board and staff strategic planning session in the near future. To make this workable, we are currently planning a format by which the members can provide their thoughts and concerns for the board’s consideration in this effort.
Florida is a great place to breed, raise, train and race horses. It is up to us, all of us, to protect this fine tradition and make it as rewarding to our current members as possible while enticing people outside of the state to join us. People in our business are forever optimistic; I’m no different.