When NYRA Chairman of the Board Barry K. Schwartz started his fight in 2001 to lower the takeout at the New York tracks he argued that putting more money back in the horseplayers' pockets would ultimately generate a substantial increase in handle, benefitting bettors, horsemen and NYRA. It wasn't that Schwartz was saying anything that hadn't seen said before. Every credible study ever done on the subject had proven beyond any doubt that a lower takeout will generate sizeable handle increases, which translate into more profits for the tracks and larger purses for horsemen.

Some three years later, the NYRA takeout reduction, which began at the 2001 Saratoga meet, has been wildly successful. By lowering the takeout to just 14 percent on win, place and show bets and 17.5 percent on exactas, daily doubles and quinellas, NYRA has given an additional $95 million back to bettors over and above what would have been returned under the old takeout system. Bettors don't hide that money under their mattresses; they send it back through the windows.

Total handle on NYRA races in 2000, the last time the old takeout system was in place throughout a full year , averaged $9,656,887 a day. In 2002, the first full year with the lower takeout structure, average daily handle had grown to $10,604,210 or an increase of $947,323 a day. The only possible explanation for the improved figures is the reduced takeout.

In a reasonable world, everyone would be celebrating what has been a win-win situation and thanking Schwartz for having the foresight to fight the good fight. But whoever said horse racing was a reasonable world? NYRA's takeout reductions are being threatened by New York State Senator William Larkin, who, at the bequest of the state's OTB systems, has introduced a bill that is calling for substantial increases in the NYRA take. And the horsemen, who are sure to be hit with lower purses if the bill passes, have jumped on board in support.

What's a sane person to do, laugh or cry?

It's clear that Larkin, the chairman of the senate's standing Committee on Racing and Wagering, either doesn't understand the industry he is supposed to regulate, is just following orders from the OTBs or a little of both. OTB obviously doesn't get it either.

The OTBs want the politicians to believe that the lower takeout has had a negative impact on their business because they are getting a smaller piece of the pie. But the pie has grown larger, at the track, at simulcast locations across the country and at New York OTB, thanks to the infusion of additional handle created by the takeout reduction.

It is impossible to compare pre and post-takeout reduction numbers at OTBs in New York because OTBs now simulcast fare more out-of-state races than they used to. With customers having more betting options, OTB's handle on NYRA racing has, of course, fallen. But total handle on all product at OTB risen substantially. They can't make a legitimate claim that a lower takeout has hurt their bottom line. Instead, they are falling back on flawed logic that by raising their cut on a wager they can only make more money. Guess no one over there has an economics degree.

Then again, why should OTB have any say as to how NYRA runs its business?

Perhaps even more outrageous is the support shown for the bill by the New York Thoroughbred Horsemen's Association. The organization has said it backs legislation for a higher takeout because it believes its support will encourage politicians to pass another bill that would give the group a seat on the NYRA board and force NYRA to operate more openly. Those are worthy goals, but can't they be achieved without selling out the horseplayer? And should horsemen be in support of a bill, that if passed, is sure to lower handle. A higher takeout will no doubt wipe out the gains in average daily handle. With less money bet, how long will it be before NYRA has to cut purses?

That the reduced takeout has been the best thing to happen to the downtrodden horseplayer in years is reason enough to leave it alone. In the form of the takeout, this industry charges an outrageously high price on the cost of a bet, a primary reason why racetracks have such a hard time competing against casinos and sports betting. But put that aside and you still have concrete evidence the lower takeout has benefitted NYRA, not to mention the OTBs and the horsemen, two groups working to do away with the reductions.

Raising the takeout is simply a terrible idea. William Larkin and his bill must be stopped.