State Senate Race Updates: 36th District – First Rick Hiles Pleaded for Help, Now He Fights For It, and He May Win

The Kentucky state senate dynamics are taking a dramatic shift once again. After the sickening Democratic loss by Jodie Haydon in the special December election, the assumption was that Republican state Senate President David Williams and former horseman and Republican state senator Damon Thayer would successfully torpedo the horse industry’s hopes for years to come, despite the fact that two of three open Republican seats in 2009 became Democratic.

That assumption is dead wrong. The landscape is rapidly taking shape, with some expected and some completely unexpected challengers that will present very formidable problems for Williams, Thayer and the out of state casinos they represent. When the sum of these races is added together, it becomes very clear that 2010 could be just as successful as 2009 in taking away state senate seats, and that 2010’s elections could tip control of the senate and allow for expanded gaming to pass.

The most startling example is in the home town of the Kentucky Derby, where Kentucky HBPA President (Horsemen’s Benevolence & Protective Association) and thoroughbred horse trainer Rick Hiles is taking on Republican incumbent Julie Denton, who voted last week with David Williams to add an additional constitutional obstruction to expanded gaming.

For those unfamiliar with the HBPA which Hiles presides over in addition to his paying job as a trainer, it is a 70-year-old volunteer organization with 6,000 Kentucky members (and 35,000 throughout North America) that is dedicated to protecting the rights and providing assistance to racehorse owners & trainers. It is by no means possible to consider the HBPA as a racetrack organization. In fact, historically, it is extremely commonplace for the HBPA to be in adversarial negotiations with tracks on issues such as takeout, purse structure, and other issues critical for owners and trainers. This is significant because Williams and Thayer have tried to divide the horse industry and portray expanded gaming as something that only racetracks seek and only racetracks would benefit from.

In its self-description, the HBPA affirms that its role is to represent owners and trainers, and not racetracks:

The HBPA, established in 1940, is an organization of Owners and Trainers, approximately 40,000 nationally in 23 states and Canada, and over 6,000 in Kentucky. The association is governed by a Board of Directors consisting of Owners and Trainers volunteering their time and elected by the membership every three years. The HBPA is committed to working for the betterment of racing on all levels.
The HBPA represents owners and trainers on several fronts:
In negotiating sessions with each race track regarding purse structure, equitable share of simulcast revenues, overall track safety, sanitation and security.

Despite that historic position of advocacy for the owners and trainers, last May, the HBPA and Rick Hiles stood together with the racetracks, and pleaded with the legislature to give them a fair chance to compete.

On a sun-kissed day that normally would have seen racing at Churchill Downs, the heads of six Kentucky racetracks and the largest thoroughbred horsemen’s association were in the track’s empty paddock Wednesday pleading for support for the state’s signature industry.
The fix, they say, is electronic slot machines, which are helping nearby states fatten purses and lure horses away from Kentucky.
Earlier this month Churchill dropped a day a week of racing because of that horse shortage. That shortened week went into effect Wednesday.
For a $4 billion industry and 100,000 jobs on the line, the Kentucky legislature has got to step up and find a way to make this work for us and give a chance to be competitive, Ellis Park owner Ron Geary said.
…
I don’t want Kentucky to be known as the former horse capital of the world, said Gov. Steve Beshear, who was elected in 2007 on a campaign that embraced expanded gambling. We must act quickly to ensure that we maintain that investment in our state.
…
We feel this is an idea whose time has come, Keeneland president Nick Nicholson said. We wanted to be crystal clear to everyone that this industry is unified as perhaps it’s never been. We are in serious jeopardy, as we’ve perhaps never been. And if no action takes place, and we lose our racing circuit, and we lose the prominence of our Kentucky breeding industry, we did not want anyone in this state to be surprised.
…
Rick Hiles, president of the Kentucky division of the Horsemen’s Benevolent and Protective Association, said an increasing number of trainers are looking to relocate because Turfway and Ellis Park do not offer viable purses.
“If we lose two or three of our minor tracks, it’s going to affect Churchill Downs tremendously, he said. “The horsemen will not come here, and the racing product at Churchill will deteriorate. Behind that, the breeding industry will go down, too. … Mares already are leaving to go to states with big breeding incentives. We’ve been asking (for help) for 10 years. Now we’re pleading, a last-ditch effort.”

Hiles has also served in other volunteer capacities within the industry. In 2008, he was re-appointed to the volunteer Kentucky Equine Drug Research Council, which was created to advise the Kentucky Horse Racing Commission on research and testing of equine drugs. By law, the council reviews testing research conducted at the University of Kentucky or conducted elsewhere with state funds.

Shortly after that May conference, the horse business realized it was useless to plead with David Williams, Damon Thayer and the senate Republicans, and realized it was time to start fighting. Rick Hiles may deliver a knockout punch to a weakened opponent in November.

Meanwhile, Hiles’ incumbent opponent, Republican Julie Denton also made headlines last summer for her conflicts of interest when she landed a fat salary being paid full time to represent the Passport Health Plan in administrative appeals of dental benefit decisions. This was called “as flagrant a conflict of interest as I think you could see” for her receiving some unknown amount to be a full-time employee of a company is paid by a cabinet Denton oversees as a legislator.

The Courier-Journal reported that:

State Sen. Julie Denton, a Louisville Republican who heads a key Senate committee that oversees Medicaid, has been hired to represent a company that handles dental services for a managed-care group that runs the state’s Medicaid program in the Jefferson County region.
Denton, chairwoman of the Senate Health and Welfare Committee, began the fulltime job July 1 for MCNA Dental Plans, a Fort Lauderdale, Fla. company that recently won an annual contract with Passport Health Plan worth about $20 million a year.
The position requires her to serve as the link between dentists who see Medicaid patients and MCNA, which processes and pays claims. It also requires her to handle dentists’ questions or complaints and represent the company at state hearings where people appeal denial of services.
She declined to say what it pays.
Denton, a dental hygienist who has been a state senator since 1995, said she’s qualified for the job and sees no conflict with her legislative duties, which include oversight of Passport and its $768 million annual state Medicaid contract to serve about 150,000 people in Jefferson and 15 surrounding Kentucky counties.

As the Broward Palm Beach New Times noted in July, “it’s one humdinger of a coincidence that Denton began her work with MCNA earlier this month, not long after MCNA won its contract.”

And the editorial writers wrote:

What is it about conflict of interest that Sen. Julie Denton, Senate President David Williams and the Legislative Ethics Commission don’t understand?
It’s not surprising that Ms. Denton tries to claim her chairmanship of the Senate Health and Welfare Committee doesn’t conflict with her new job at MCNA Dental Plans (a company that handles dental services for a managed care group, as part of the state’s Medicaid program for this metropolitan region).
It should have been perfectly obvious to her that she couldn’t credibly represent the interests of both taxpayers and a company that depends on taxpayers’ money. But she needed the job. And she wants to put the best face on the embarrassment. Or maybe she thought nobody would notice.
Mr. Williams is impervious to shame. He defends Ms. Denton, citing an informal commission opinion that there’s no rule against her working for MCNA, as part of the Passport Health Plan system in Jefferson and nearby counties. But then he needs her vote, and that of other GOP caucus members, to continue obstructing progress in Frankfort and thwarting Gov. Steve Beshear. If he is unapologetic about leaving the state without enough revenue to finance needed programs and services, why would he admit the impropriety of his choice of someone to control the scrutiny of Passport’s $768 million state contract? If he is unashamed about blocking slots at racetracks and leaving the state’s signature horse industry to collapse, why would he worry about a mere ethical problem in his caucus?
The commission may have advised that Ms. Denton’s new job and her secret salary are technically within the rules, but isn’t it quite clear that she has no business simultaneously working for MCNA and running the committee that assesses Medicaid performance, including the quality of Passport services?
If that isn’t a conflict, then Donald isn’t a Duck.

Since then, despite being paid a full time and hidden amount as a salary, Denton has only attended a handful of hearings to earn her salary. Her involvement is minimal, and is limited to using her cell phone on speaker phone to call a dentist, who then submits information on behalf of Passport Health Plan’s dental provider.

Given his leadership of a group of 6,000 highly motivated Kentuckians, his location in the home town of Churchill Downs, and Denton’s ethical questions, Hiles must be considered one of the prime contenders to take away an incumbent’s seat in November.

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