Race track underpaid purses, lawmakers hear

A Legislative Auditor’s report delivered Tuesday to a joint House and Senate hearing charges that a harness race track underpaid horse owners by almost a half-million dollars between 2008 and 2012.

Running Aces Harness Park, located near Forest Lake, under-calculated the amount of wagered money it was required to contribute to race purses by more than $436,000, the report issued earlier this month by the Office of the Legislative Auditor found.

[WATCH: Learn more about the role of the Office of the Legislative Auditor ]

The auditor’s review, requested in January by the Minnesota Racing Commission in response to a 13-month dispute between Running Aces’ owners and a group representing Minnesota harness racers, recommends the track negotiate “reasonable payment” of the past underpayment.

Rep. Joe Atkins

“This is about more than the half-million dollars missing,” said Rep. Joe Atkins (DFL-Inver Grove Heights), who chairs the House Commerce and Consumer Protection Finance and Policy Committee. “It’s about integrity… the integrity of racing.”

Running Aces General Manager Bob Farinella told lawmakers during Tuesday’s joint meeting of the House Commerce and Consumer Protection Finance and Policy, and the Senate State and Local Government committees that the track’s owners were close to reaching an agreement with racing officials to repay, over a three-year period, the full amount of missing purse contributions.

“We believed we were following the law and did not actively subvert it,” he testified.

The report also lays blame for the dispute at the feet of state racing officials for lax oversight of purse contributions and language in state statute that Legislative Auditor Jim Nobles said is “not clear at first reading.”

[Read the Office of the Legislative Auditor’s full report here]

Tom DiPasquale, Executive Director of the Minnesota Racing Commission, told lawmakers the commission is “no longer on the sidelines,” and is already far more active in monitoring purse contributions at both Running Aces and Canterbury Park in Shakopee.

Rep. Joe Hoppe (R-Chaska) praised the auditor’s report and all sides’ efforts to find a solution to the dispute during Tuesday’s hearing.

“I’m glad there’s going to be a settlement and I’m glad it’s not going to be (paid) all in one year,” Hoppe said.

Former Minnesota Racing Commission director Jesse Overton, however, told lawmakers he believed the purse contribution error wasn’t simply a misreading of state law, calling it an “intentional diversion” of would-be race winnings “into the hands of” Running Aces’ owners and operators.

“There’s much more here than ‘the law is ambiguous,’” he said.