V’landys lashes ‘smear campaign’ against him at Rosehill inquiry
New racecourse a necessity for multibillion dollar development to go ahead, RNSW chief claims
A combative Peter V’landys claims Racing NSW would have the final say on any proposed sale of Rosehill because it would be incumbent on a new racecourse being constructed in Sydney in order for the multibillion dollar deal to go ahead.
In an at times sensationalist second day of the inquiry by the NSW Upper House Select Committee into the proposed sale and development of Rosehill, V’landys came out swinging during a 14-minute opening statement, targeting the “cheats and the undesirables, especially the ones that are cruel to horses”, and claiming “I’m aware that some of them are using this inquiry to undermine Racing NSW”.
Spending much of his close to 90 minutes in the hot seat rebutting what he said are incorrect allegations and inaccuracies made at the first Select Committee hearing on July 22, such as that witnesses were pressured not to attend the inquiry, V’landys was on Friday also incensed about receiving on the eve of his appearance in Parliament what he claimed was a threatening letter from breeders “trying to intimidate me” and to “not tender evidence at the inquiry”.
“We get accused and smeared that we are stopping people from attending the inquiry but yet we get the Group 1 hypocrisy with a letter saying our evidence shouldn’t be tendered,” V’landys told the hearing.
The joint letter from Thoroughbred Breeders Australia and Thoroughbred Breeders NSW presidents Basil Nolan and Hamish Esplin was addressed to Racing NSW chair Dr Saranne Cooke. It is believed to call on V’landys to withdraw “manifestly false” comments he made to the Sydney Morning Herald in which he accused independent Upper House MP Mark Latham of acting on behalf of “some very wealthy breeders who don’t wish to be held to account for animal welfare”.
Latham had, in Parliament on Wednesday, been scathing of V’landys’ administration of Racing NSW and called for his immediate resignation.
During Friday’s questioning of 14 witnesses, which also included Australian Turf Club chairman Peter McGauran, vice-chairman Tim Hale SC and director Caroline Searcy as well as trainers Chris Waller and Richard Freedman, it was revealed that:
The value of the 60-hectare Rosehill site could be worth as little as $1.6 billion or as much as $23 billion depending when and how it was developed;
Racing NSW props up the ATC’s annual parimutuel funding if revenue from the longstanding totalisator agreement falls below a floor amount of $83 million;
ATC race meetings generate 49 per cent of thoroughbred wagering revenue in NSW, but receives 55 per cent of the revenue, according to V’landys;
The ATC owes Racing NSW $113 million;
Racing NSW has $100 million in cash reserves to maintain prize-money levels.
If Rosehill is sold and developed into 25,000 dwellings and a metro station, V’landys said the ATC would require the regulator’s approval because it would breach the Intracode agreement established when the totaliser was privatised in 1998.
It means a new racecourse – at the so-called brickpit at Homebush or any other undisclosed Sydney sites alluded to on Friday – was “absolutely” necessary, the sports administrator said.
“It is [Racing NSW] board policy that a new track must be built if Rosehill is sold,” said V’landys, who also told the inquiry he was in Washington in the US when he was first made aware of the ATC’s proposal.
“The ATC is bound by the intracode agreement which legislates that a certain number of meetings are staged at Rosehill.
“For that to change it needs Racing NSW approval. Homebush has been identified as an option and we are carrying out our own due diligence with engineers and surveyors.
“Racing NSW has to consider the entire industry and balance the interests of everybody.”
ATC chairman McGauran, who appeared alongside the club’s head of membership and corporate affairs Steve McMahon at 9am, said $50 million of the $130 million owed to Racing NSW would need to be repaid if the Rosehill deal proceeded.
“They are interminable loans,” said McGauran who again stated the club’s members would vote on the proposal.
“Theoretically, if the sale were to proceed, the ATC would have to return $50 million to Racing NSW. The rest of the loans are associated with Royal Randwick.”
From the time the plan was made public, a $5 billion valuation of the Rosehill precinct has been floated.
But it was revealed that the current valuation of the Rosehill racecourse site was $1.6 billion and that no official document has been tendered to back up the long-suggested $5 billion figure for the western Sydney site.
Later, Racing NSW board member Garry Charny, a racehorse owner and breeder, suggested that selling Rosehill could realise the ATC as much as $20 billion if it was developed over three decades. During V’landys’ testimony he claimed the development could be worth $23 billion over 35 years. He said the figure was provided by an expert who was undertaking due diligence into the proposal on behalf of Racing NSW.
“The best advice we’ve had if you wanted to sell Rosehill Gardens as in no rezoning, walk in, walk out [is] $1.6 billion,” McGauran said.
“And of course that’s a paltry return for the loss of a premium racetrack.
“We wouldn’t even let that bid through the door.”
Charny agreed that Rosehill’s current value was $1.5 to $2 billion, but that the $5 billion figure was “completely wrong” and that there was “a lot of contingencies in this debate”.
“If you do a 30-year development with a developer on what I would call normal terms, taking some development risk, the value of this development is closer to $20 billion to the ATC and that number has not come out and I don’t know why,” Charny said.
“You don’t just sell an asset like this [for $1.5 to $2 billion], that’s not how it works.”
It was later revealed that Charny met with V’landys and Racing NSW chief operating officer Graeme Hinton on Wednesday, 48 hours prior to Friday’s hearing. Hinton also appeared as a witness on Friday.
Charny was questioned about the governance of Racing NSW and, in particular, V’landys’ 20-year tenure and the apparent free reign he has at the helm of the state’s peak racing body.
“Look, the delegated authority is a thorny topic on all boards and with all CEOs. CEOs want more. Boards want less,” Charny said.
“The delegated authority that currently exists in Racing New South Wales is somewhat old, I believe. Could it do with a fresh pair of eyes to look at it? Yeah, I think it probably could. That’s probably my assessment of it.”
Earlier, McGauran said parimutuel totaliser revenue to the ATC had dropped from $90 million last year to $72 million this year, triggering the top-up clause to $83 million from Racing NSW.
The chairman said the ATC did not have a sustainable business model to expand and meet the expectations of its customers.
“To build the facilities for the racing fan and horse alike, we need hundreds of millions of dollars into the future,” McGauran said.
“The way people interact with sport and racing is rapidly changing and the potential for a new revenue stream like this has the ability to secure and transform racing’s future.
“It’s important we look ahead and plan and invest otherwise we will accept the status quo and our facilities will be frozen in time.”
Searcy and Hale said feedback from members they had received was overwhelmingly against the sale of Rosehill.
Although remaining sceptical about the deal going ahead, Searcy suggested the due diligence being undertaken should continue.
“I think all along it has been the role of the board to do that due diligence and to actually find out whether there is any merit in it, so I think to stop right at the moment … I don’t think there is a lot more money being spent,” Searcy said.
“Racing NSW has also been publicly documented as doing their own due diligence, as was referred to before, and taking some of those costs away from the club, so we’re not actually spending a lot more money at the moment on that due diligence to find out at least what is possible with the proposal.”
Waller reiterated his stance that Rosehill should be retained as a racecourse as well as a public space for the residents of Sydney’s inner west, while Freedman said there were too many questions and few answers regarding the multibillion dollar, decades-long project to provide a firm opinion.
“We are really flying blind at the moment,” Freedman said.
“There’s seven trainers at Rosehill and between us we don’t even have a shared opinion.
“I’m a little more open to the idea of a new track and training facility [than Waller] but the fact is we don’t have the information at hand to make any real informed decision.
“All the details that we would need to know to put our minds at ease we don’t have, I could give you a laundry list of things we need to know before we could support any sale.
“I honestly don’t know how anyone has come to any conclusion without all this knowledge. There’s so much I don’t know, I don’t even know why we are having this inquiry, we don’t have the information to make a judgement.”
The third hearing at Parliament House in Sydney is scheduled for September 12.