New row over control of Punchestown

The Punchestown racecourse, which was at the centre of a major political controversy last year over its funding, is embroiled…

The Punchestown racecourse, which was at the centre of a major political controversy last year over its funding, is embroiled in a new row over the control of the facility.

The dispute centres on a disagreement between Horseracing Ireland (HRI) and two men who originally highlighted serious financial problems at the facility in 2002.

In the latest row, the board of Horseracing Ireland refused to sanction the appointment of one of them, Mr John Ross, to chair the racecourse's management company, Blackhall Racing, at a meeting on Friday.

Mr Ross, along with businessman Mr Nick Bullman, drew attention to serious financial problems at the racecourse three years ago.

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This led to investigations by the Comptroller and Auditor General and the Public Accounts Committee into the €14.8 million State funding of an agricultural and equestrian event centre at the racecourse.

Last Friday's action by Horseracing Ireland followed claims by Mr Ross and the Kildare Hunt Club (KHC), which owns the racecourse, that certain leases involving the racecourse lands are invalid and need to be replaced.

If the leases are proved to be invalid, it would mean that various Government Departments and State agencies, including Horseracing Ireland, had no security when they gave over €28 million to the racecourse, including €14.8 million for the event centre.

This €28 million was given between 1996 and 2002, when the racecourse underwent a major redevelopment programme.

The controversy over the €14.8 million Government funding of the equestrian centre, in the constituency of the then minister for finance, Mr Charlie McCreevy, has been identified as a factor in Fianna Fáil's poor performance during the local and European elections last year.

Mr Ross, a solicitor, and Mr Bullman, a businessman who lives in Co Wicklow, were asked by the hunt club in 2001 to examine the finances of the racecourse.

Their report identified serious financial difficulties at the course, which they found out was on the brink of liquidation. It led to the intervention of Horseracing Ireland, the State authority responsible for the industry, with a rescue plan in late 2002.

Horseracing Ireland took over the day-to-day running of the course, with it and the Kildare Hunt Club agreeing to establish a new joint venture company to oversee its continued operation until all major debts were repaid.

Mr Ross and Mr Bullman joined an interim committee with representatives of Horseracing Ireland to sort out a number of issues, including tax liabilities of up to €250,000, before the new operating company could be established.

Early in 2003, Mr Ross raised concerns about various leases of the racecourse land, which dated back to 1996, between the hunt club and a number of companies, including Blackhall Racing, which were established to minimise liability for VAT during the redevelopment and which received the various grants from Government and State agencies.

Last year Mr Ross and the Kildare Hunt Club obtained independent expert advice that the leases were invalid and, unless they were replaced, could leave the hunt club liable to more than €2 million in taxes.

Horseracing Ireland received legal and expert advice stating the opposite.

The hunt club made a submission earlier this year to the Revenue Commissioners on the basis that the leases were invalid.

The joint venture company has still to be established, leaving Blackhall Racing, which is owned by the hunt club but has representatives from Horseracing Ireland, the main legal controller of the racecourse.

According to a statement to The Irish Times from Mr Bullman, he and Mr Ross were informed by Horseracing Ireland officials at a meeting last November that the joint venture company would not be established and that Blackhall Racing would be the main controlling vehicle.

In December the hunt club held elections for four positions on the board of Blackhall Racing and Mr Ross was elected chairman. However, under a loan agreement dating back to 2001, Horseracing Ireland has a right of veto on the chair of Blackhall Racing, which it previously used in early 2002 when Mr Bullman was elected to the chair.

On Friday the board decided to use this veto power again.

Yesterday Mr Bullman, a businessman and member of the Kildare Hunt Club, said Horseracing Ireland was blocking a resolution of the racecourse's problems.

"It is extraordinary that a Government body should see fit to interfere not once but twice in the democratic electoral process of a club," he said. "By not 'approving' the results of the club's democratic elections, HRI has effectively tied up the process of recovery at Punchestown."

A Horseracing Ireland spokesman confirmed that a decision had been made by the board, but that the decision had yet to be announced and it could not comment further. He said that since the authority took over the running of the racecourse, its loss-making situation had been turned around.