Owners of a horse hospital face critics on many fronts

By BRUCE LAMBERT | New York Times | Published: July 13, 2008
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Mr. Lambert introduces this story with:

ELMONT NY — WHILE thoroughbred racing fans argue over Big Brown’s spectacular rise and fall, his owners are stirring another debate here, over an elaborate new orthopedic hospital for horses set to open late this summer.

Big Brown was electrifying when he breezed to victory in the Kentucky Derby and the Preakness Stakes in May. But then the powerful colt mystified handicappers with a last-place finish at the Belmont Stakes here in June, ending his bid for the Triple Crown.

That performance drew widespread attention and scrutiny to Big Brown’s majority owner, a Long Island investment firm named International Equine Acquisitions Holdings, of Garden City. Now attention has turned to another venture of the company: the Ruffian Equine Medical Center, a $17 million state-of-the-art operation under construction next to the Belmont Park track.

The hospital, which is nearing completion at 111 Plainfield Avenue, will include 29 stables, two operating rooms, a radiology unit, a laboratory, a pharmacy and a giant treadmill for diagnostic stress tests. Slings, hoists and overhead rails will move immobilized patients weighing 900 to 1,400 pounds.

While many in the horse industry welcome the hospital because they sometimes need to ship horses to New Jersey or Pennsylvania for specialized care, critics are objecting to the company’s request for more than $1 million in property-tax breaks. And competitors providing equine medical care elsewhere on Long Island are raising questions about possible conflicts of interest in owning horses and providing their medical care, as well as treating horses owned by racing competitors.

“The owners of these racehorses are very wealthy people, so why are we giving tax breaks to millionaires?” Patrick Nicolosi, president of the Elmont East End Civic Association, said in an interview. “They can afford million-dollar horses, so they can afford to pay their taxes, too.”

The criticisms bubbled up at a recent hearing on the requested tax breaks, held by the Town of Hempstead’s Industrial Development Agency. Its board postponed a vote on the tax breaks because the company was amending its application.

In five years of existence, International Equine Acquisitions Holdings and its subsidiaries have become a force in racing.

The company uses investor money to buy promising horses, with about 80 on its current roster. The company has won more than $10 million in races, but it also profits from stud fees and from selling offspring. Big Brown’s breeding rights were sold in May to the Three Chimneys Farm in Kentucky for a reported $50 million to $60 million. Company officials have denied those reports but have declined to divulge any figures.

“Why would a company that already bought the property, started construction and now has millions in stud fees need an inducement to come to Elmont?” asked Harvey B. Levinson, Nassau County’s chief assessor. He also raised concerns about some of the legal problems that some people associated with the company have had in the past.

ALMOST COMPLETE An orthopedic hospital for horses being built in Elmont is owned by an investment firm that also owns racehorses.

The story continues with:

But the company and its supporters defend the hospital as a boon for the horse industry, and for Elmont.

“We’re providing a tremendous service, filling a need for horse owners,” Richard J. Schiavo, a co-president of the company, said in an interview. “And we’re bringing business and jobs into the neighborhood.”

Sam Uliano, president of the Nassau-Suffolk Horsemen’s Association, said he could hardly wait. “The whole idea is absolutely wonderful,” he said. “The sooner the better.”

The project has also has won praise from Hempstead’s town supervisor, Kate Murray.

Those with legal problems associated with the company include Michael Iavarone, the firm’s co-president and a former stockbroker whom regulators suspended for 10 days and fined $7,500 for unauthorized trades in 1999. And in 2003, he was sued by the Keeneland Association of Lexington for failing to pay for horses he bought at an auction and was ordered to pay $554,156, according to court records.

The company’s current primary trainer, Richard Dutrow Jr. — who handles Big Brown — has repeatedly been suspended and fined for illegal substances given to horses. Mr. Dutrow acknowledged having his horses injected with Winstrol, a steroid outlawed by some states but not New York.

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Story Source: New York Times, Photograph: Vic DeLucia for the New York Times

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