The Minnesota legislative auditor has found that Running Aces Harness Park did not comply with state law regulating the amount of money it put into its purse fund from 2008 through 2012, estimating that it underpaid horsemen racing at the Columbus harness track by $436,865.
In a report issued Tuesday, the auditor also found that the Minnesota Racing Commission did not adequately oversee purse payments at Running Aces. The report recommends that the track make a “reasonable payment’’ to make up for the shortfall, that the racing commission improve its oversight and that state law governing the payments be clarified.
Running Aces issued a statement saying it put an additional $100,000 into the purse fund in February. Its response to the report asserts that other payments it made to horsemen should offset the shortage. The racing commission said it will begin weekly reviews of purse allotments at Running Aces and Canterbury Park, ask the legislature to clarify laws regulating purses and begin negotiations with Running Aces regarding the underpayments.
The state auditor’s review came at the request of the racing commission, which has been locked in a 13-month dispute with Running Aces over its purses. Some commission members believed the law requires that tracks contribute 8.4 percent of the handle to the purse fund, which is how Canterbury Park calculates its payments. From 2008 through 2012, Running Aces contributed 8.4 percent of the takeout, which is the amount the track deducts from the handle before paying winning wagers.
Running Aces adjusted its formula in 2013 and began paying 8.4 percent of its handle to purses. But the racing commission, Running Aces and harness horsemen could not agree on what, if anything, the track should pay to settle the shortfall from the previous five years. The auditor’s report concluded that the payments should have been calculated on the handle, which would have given $436,865 more to purses.
State Rep. Joe Atkins (D-Inver Grove Heights) said Tuesday that the House Commerce Committee will discuss the audit at a hearing later in July. “I and other members of the committee from both sides of the aisle have been raising serious questions about Running Aces’ operations for some time,’’ Atkins said in a statement. “We will discuss steps to prevent this from happening again and to ensure there is absolute integrity and honesty in Minnesota racing.’’
Tom DiPasquale, executive director of the racing commission, said he has scheduled a meeting with Running Aces’ board of directors later this month to discuss the track’s response to the report. While he hopes a settlement can be negotiated quickly, he said he was “a little disappointed’’ that Running Aces continues to maintain it does not owe any back payments.
“I don’t see much difference in that position from what they had taken before the auditor’s report, which was that certain aggregate offsets made up the difference,’’ said DiPasquale, who was appointed as executive director in November. “I read the auditor’s report as concluding differently from that.
“We’ll see where it goes from here, but we don’t intend to drag this on. At some point, the commission has to exercise its authority.’’