The Oregon Racing Commission (ORC) recently underwent an audit that sheds light on concerns surrounding the state’s horse racing industry and the regulatory framework governing it. This audit highlighted the need for updated laws and rules to minimize conflicts and ensure transparency in Oregon’s horse racing sector.
Conducted by the Oregon Audits Division, the investigation revealed several key concerns regarding the ORC and its oversight of the horse racing industry, which during the 2019-21 biennium, generated around $7.8 million in revenues, with more than $1.4 million contributing to the state’s General Fund.
One of the significant issues identified in the audit was the delay in appointing and replacing ORC commissioners, which can have repercussions on the commission’s effectiveness and functioning. Timely appointments and replacements are crucial to ensure that the commission maintains its regulatory authority and can address industry challenges promptly.
“ORC did not have a full commission for nearly three years, only recently having five commissioners as of Spring 2023. It also has long-standing commissioners overdue for successors to be appointed,” auditors said.
The audit also highlighted the need for improved oversight and transparency regarding funds allocated to support the horse racing industry. It is essential to have clear guidelines and procedures in place to ensure that these funds are utilized appropriately and in line with state statutes and regulations.
Another concern raised in the audit is the limited documentation of ORC’s reviews of historical horse racing (HHR) machines, indicating potential gaps in oversight procedures. Proper documentation is vital to ensure thorough reviews and to provide a transparent record of the commission’s decisions and actions.
“ORC allocates money to financially support summer race meets, commercial races, and Oregon horse associations. There is limited oversight and transparency of how those funds are approved, distributed, and used,” auditors found.
The audit made four recommendations on how the ORC can improve.
The first suggested that the ORC should implement requirements, whether in policy or rule, to assess new and modified game and wagering operations, ensuring alignment with state statutes and the Oregon Constitution. This will help minimize conflicts and ensure that all operations within the horse racing industry adhere to the established regulatory framework.
Secondly, to enhance transparency, the ORC should develop comprehensive rules, policies, and procedures for allocating and reviewing the utilization of Advance Deposit Wagering (ADW) hub funds. This will provide clear guidelines for the allocation and utilization of funds, minimizing potential misuse and ensuring transparency.
Next, the audit recommended that commission meeting minutes should provide clear and transparent documentation of approval details, including relevant attachments. Transparent documentation will allow stakeholders to understand the decision-making process and ensure accountability.
Lastly, the audit emphasized the importance of maintaining well-documented records of licensee reviews and safeguarding them appropriately. Proper documentation will provide a clear record of reviews and enable effective oversight of operations within the horse racing industry, the audit suggested.
