Open Letter on HISA
August 30, 2022
HISA launched almost two months ago and today there will be another hearing in Louisiana concerning its operating status. The THA, along with our colleagues at TOC, KTA and TOBA, have been engaged directly with HISA to create a responsive regulatory structure that is built upon our current industry best practices.
Two federal suits (one in Texas by the National HBPA and one in Kentucky by the states of Oklahoma, West Virginia and Louisiana) have been filed by various Plaintiffs alleging that the HISA statute is unconstitutional. Specifically, that it impermissibly pre-empts State regulation of horse racing. In both cases, the plaintiffs sought injunctions to stop HISA before its July 1 start-up date and prevent it from enforcing its law until its constitutionality was finally determined by the courts. In both cases, the injunctions were denied.
A third suit was recently filed in Louisiana by the Louisiana HBPA, West Virginia HBPA, the Jockey’s Guild, the states of Oklahoma and West Virginia and others. Rather than challenge the constitutionality of HISA, this suit took issue with more than thirty specific regulations adopted by HISA, including challenges to the assessment formula, the definition of “covered horse”, the search and seizure regulation and the length of the comment period that the FTC used to finalize the Safety Program, Assessment Formula and Registration regulations.
Of the numerous regulatory challenges, the Court rejected all but four. With respect to those four issues only, the court concluded that it would enjoin enforcement of HISA as to Louisiana and West Virginia only until those four perceived errors were fixed. An appeal was immediately filed by the United States Department of Justice, and the appellate court stopped the injunction and has ordered that HISA remain in effect in Louisiana and West Virginia and as to the Plaintiffs, until further order of the court. Today’s hearing directly concerns these four issues.
Let’s Look At The Four Issues:
COMMENT PERIOD – The Justice Department strongly believes that the court erred in its interpretation of the appropriate comment period for the adoption of regulations. However, if the appeal on this issue fails, there is an easy remedy for HISA to pursue – republish and readopt the regulations in what is determined to be the appropriate publication and comment period..
COVERED HORSE – HISA agrees that the definition of “covered horse” in the regulations is incorrect, and they have already moved to fix that definition. It awaits final FTC approval.
SEARCH AND SEIZURE – The THA very forcefully objected to HISA’s proposed regulation both with HISA and the FTC. At a Maryland THA Zoom meeting in June, HISA informed the attendees that it had already recommended the necessary changes to the FTC for approval. We are awaiting final FTC approval. The amended regulation will be consistent with current longstanding industry practice. HISA has also indicated publicly that they have no intention of searching private farms or property beyond the jurisdiction of racing commissions. Accordingly, this perceived error has been cured.
ASSESSMENT FORMULA – This is one area that we believe HISA is going to have to change. As you may recall, the THA and its partner organizations vigorously objected to HISA’s assessment formula because it was based, in part, on purses, which is not provided for in the statute. It is interesting that the federal court essentially mirrored our argument to HISA and the FTC and agreed that the statutory formula does not include purses in the calculation. Ironically, Louisiana and West Virginia were the biggest beneficiaries of the funding formula that they challenged and are likely facing higher payments. We continually urge HISA to drop the purse calculation from the formula and let these states pay their fair share.
What Does This All Mean?
In short, HISA has survived constitutional challenges and the legal maneuverings now are just a distraction lacking substance. As the federal court said when it granted the limited injunction, if HISA fixes the four issues it specifically addressed as faulty, the case is over. Our view was previously, and continues to be, that litigation would be costly and there is little to gain. HISA was crafted by constitutional and administrative law experts who strongly believed then, and now, that HISA would survive expected constitutional challenges.
What Is Our Horsemen’s Coalition Doing?
The best course for our horsemen is to engage with HISA directly and frequently. It is our strong opinion that HISA will survive all constitutional challenges and be accepted as the regulatory authority on medication, and equine safety and welfare throughout the country. We are not inclined to spend horsemen’s money or time on a lost cause. Furthermore, we believe our efforts are working. The THA, along with TOC, KTA and TOBA have been in constant communication with HISA and the FTC since day one. We sought and have actually received significant adjustments to the following rules:
Pin-firing remains acceptable for curbs and splints.
Rule 8400(1)(a), the search and seizure provision, has been significantly curtailed.
Toe grabs remain permissible on hind shoes.
While the medication and enforcement rules are not done yet, our initial comment to HISA was widely praised as targeted and responsible and dozens of changes have been made by HISA at our suggestion.
Just yesterday, HISA announced it is forming a Horsemen’s Advisory Group, a glaring oversight, but one we are pleased they corrected.
In no way does this mean our work is done! In particular, the THA and our coalition partners are focused on making sure the assessment plan is fair and affordable for all of our jurisdictions. We intend to forcefully and responsibly protect the interests of our horsemen on all matters related to HISA. You should expect nothing less from us. We believe our approach has not only been in the best interests of our membership but that we have earned the respect, credibility and trust of HISA. It is better for our members to have a seat at the table rather than being relegated to the upper bleachers.
Resoundingly our members have been telling us that long-sought uniformity is the one aspect they will enjoy from HISA. Achieving uniformity is not easy and compromises are often necessary. We promise you that working with HISA, we will do the best we can for the horse, our members, and our sport. Knowing that HISA is a reality and will be regulating our sport in the future, we hope we have your support and thank those who have reached out to us already in appreciation of what we are doing to allow for a smooth transition.