On the eve of this year’s Breeders’ Cup, Representative Joe Pitts (R-Pa) posted on his website a report put together by the Congressional Research Service — an organization that provides policy and legal analysis to committees and members of both the House and Senate — into the Thoroughbred Horseracing Integrity Act of 2015 (H.R. 3084), which is currently working its way through Washington.
Commissioned by Congressman Pitts, who himself has a separate horse racing-related bill floating around Capitol Hill, the report examines whether H.R. 3084, more commonly referred to as the Barr-Tonko bill, is constitutional.
In a nutshell, the Barr-Tonko bill gives the Thoroughbred Horseracing Anti-Doping Authority (THADA) authority to establish a federally recognized set of rules and regulations as regards prohibited substances and thresholds, drug-testing procedures and drug enforcement, as well as fees imposed upon jurisdictions to maintain the whole system.
THADA would comprise a board of 11 members, six of whom would come from the United States Anti-Doping Agency (USADA), while the other five would come from the industry itself - “disinterested” parties with no ostensible stake in the sport, but with significant racing experience.
And does the Congressional Research Service find Barr-Tonko unconstitutional?
“It would appear that a strong argument can be made that H.R. 3084 delegates to THADA, a private entity, the kinds of regulatory and enforcement powers that would implicate these concerns,” the report states, without finding any definitive constitutional violations.
But the devil is in the details, they say. And proponents of the bill who have studied the report suggest that the findings are not as one-sided as might first appear to the average Joe.
“Congressman Barr is confident that his legislation is constitutional,” wrote Rick VanMeter, director of communications for Representative Barr (R-KY) in a statement, highlighting “growing support for the legislation” from “across the political spectrum”.
The report is, as to be expected, something of a knot of legal analysis and jargon. And, in reducing it down to its bare threads, I’m aware that I’m losing and ignoring many of the more subtle legal arguments and nuances in the process.
I should also provide here a couple of caveats: I’m not an attorney, nor have I been to law school. The point of this article is to glean only the most salient information from the report, not to labor over each and every word and detail.
With that out of the way, I should begin by saying that the heart of the report is given over to the following constitutional question: does Congress possess the power to grant regulatory authority to a private entity like THADA?
When framing the debate around this question, the report can be broken into three main sections, all with varying shades of interpretation: the intelligible principle, the private delegation doctrine, and contingent legislation.
For fear of falling down the same legal jargon rabbit hole myself, I’ll break these terms down as simply as possible, beginning with the intelligible principle, which is where the Barr-Tonko holds a strong claim.
The “intelligible principle” allows Congress to grant authority to a public or a private entity, just as long as that entity doesn't have “unbridled discretion” to create rules and regulations over others.
In other words, Congress could use the “intelligible principle” to grant authority to THADA, just as long as there are certain checks and balances in place.
Under this principle, the report finds that the Barr-Tonko bill would likely pass “constitutional muster”. This is because the bill contains certain provisions in shaping the anti-doping program that would appear to “adequately confine THADA’s discretion”. (One such provision is that the Uniform Classification Guidelines for Foreign Substances as put together by the Association of Racing Commissioners International (ARCI) is initially implemented, should the bill pass.)
Private delegation doctrine
The “intelligible principle” provides only one possible way to review the constitutionality of Barr-Tonko. Another is that Congress simply cannot delegate regulatory authority to a private entity, except in a narrow range of circumstances. And this is encapsulated in the “private delegation doctrine”.
The report finds that the “private delegation doctrine” raises constitutional concerns when private entities are given the broad ability to write rules and regulations that could have a “coercive effect on other private parties”.
The bottom line: this could be viewed as bad news for Barr-Tonko.
Two main cases are cited as examples as to how the “private delegation doctrine” might be applied. One of the cases involves a 1936 Act that would have given a majority of coal producers and miners in a given region the authority to impose working hour and wage restrictions on all other miners and producers in that region. The Supreme Court struck this Act down, deciding that Congress had no right to give a group of private individuals the authority to regulate “the affairs of an unwilling minority”.
Nevertheless, those cases with perhaps the closest bearing on the constitutionality of the Barr-Tonko bill are those where Congress has given regulatory authority to private entities, but with certain conditions attached to limit what power they can wield.
Here again, the report issues the following caveat: “It would appear that broad delegations of regulatory power to private entities are generally disfavored.”
The case with perhaps the closest bearing on the Barr-Tonko bill involves the Interstate Horseracing Act of 1978 (IHA). A provision of the IHA prohibits interstate simulcasting of horseraces unless the host track has a written agreement with the necessary “horsemen’s group”.
In the wordily titled Kentucky Division, Horsemen’s Benevolent & Protective Association v. Turfway Park Racing Association, the question of constitutionality surrounded giving a private entity like the horsemen’s group authority to determine through a vote whether to allow or prohibit interstate betting. But, because the court viewed the provision as a “form of conditional legislation”, the provision was allowed to stand.
So, what does this mean for THADA?
Critics of the bill say that the report confirms a number of constitutional concerns they already held about H.R. 3084.
“The non-partisan, independent Congressional Research Service affirms the problems we have been identifying with the proposed bill and probably dooms any chance of it being enacted,” said Ed Martin, ARCI president. “It is stunningly naive to believe that the states will universally turn over enforcement, investigations, and adjudications to a private entity that would be accountable only to itself,” he said.
The report identifies three main differences between THADA and USADA – distinctions that would give THADA authority that differs to a “substantial degree from the existing anti-doping framework embodied in USADA”, the report states. And Martin believes that these findings sit at the heart of the debate.
Martin said the usual checks and balances restricting private entities (like USADA) with regulatory authority are lacking in the framework of THADA, which would have no government oversight.
“Racing is a gambling enterprise and public officials historically have insisted on government regulation and enforcement,” he said. “Unfortunately the proponents of this bill have been reluctant to consider or press for alternative ways to address central rule-making, uniform rules, and consistency in enforcement.”
IHA the key to the argument
On the flip side of the coin, the key to H.R. 3084’s constitutionality is the IHA, said William Lear, a legal advisor for the Jockey Club, and one of the bill’s authors.
In essence, racetracks that don’t agree to the IHA are unable to offer their races as a basis for interstate wagering. To not agree to the IHA would be what Lear terms murder-suicide. “They would be killing themselves in the process,” he said.
But, in order for the horsemen’s groups to give the required consent to interstate wagering, they must also agree to a “lengthy agreement” of terms and conditions that addresses a broad array of issues affecting their livelihoods. These include revenue splits, purse structure, payments to the horsemen's group, as well as backside issues.
That list of terms and conditions, he said, is broader-reaching than those spelled out in the Barr-Tonko bill. Therefore, since the “horseman’s consent” condition of the IHA passed constitutional muster, then the Barr-Tonko bill, with less jurisdictional reach, should also pass muster, he said.
“What this bill does is add a second hoop you have to jump through,” Lear said. “Condition one is you’ve got to get the horseman’s consent. Condition two is that you’ve got to comply with the anti-doping rules and regulations established by THADA.”
According to Lear, another important sticking point isn’t what makes THADA and USADA similar or different, but the question of delegation of congressional authority to a private entity.
Because USADA, “a purely private entity”, has already been given authority over other sports, he believes there’s no constitutional impediment to THADA having authority over drug use in the horse racing industry.
“To say that our bill is somehow suspect because it involves delegation to a private entity, and then to somehow say that a bill that delegates power to a private entity like USADA is fine is frankly odd,” he said. “The weakest part of the report is in attempting to somehow say that a bill that relies on USADA is more constitutional than one that relies on…essentially the same kind of entity.”
Greater certainty, however, hangs over the potential for the Barr-Tonko bill to eventually end up in court. “Most new legislation that is at all controversial gets challenged in court sooner or later,” said Lear. “And we’ve got to be prepared for that.”