The Future Of The Kona Lottery
Ironman CEO Andrew Messick comments on the decision to settle and the future of those 100 Kona slots.
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A ticket to Kona—a.k.a. entry into the Ironman World Championship—is the most exclusive invitation in all of endurance sport. Only the freakishly fit, most tenacious, VO2max-endowed athletes qualify for the world championship at various Ironman races around the globe. But since 1983, Ironman has left the back door for its marquee event slightly ajar via a lottery program in which 100 age groupers are granted a ticket to Kona.
For $50, an athlete could enter the lottery. If selected, he or she paid an additional $850 to register for the race, the standard entry fee. In March, Ironman announced the 100 lottery winners for the 2015 race, ranging in age from 20 to 74 and representing 16 countries. But they will be the last class of athletes to make it to Kona through the current lottery system.
Ironman announced last week that the federal government has deemed the company’s lottery program illegal, and that in addition to having to reformat its lottery program, Ironman has paid $2,761,910 to the government for money collected from the lottery dating back to October 2012, a negotiated date.
“Their view was that for the last 30 years we’ve been operating an illegal gambling enterprise and that the Kona lottery under Florida anti-gambling and anti-lottery statutes is illegal,” said Ironman CEO Andrew Messick. “We do not have a license to conduct gambling operations, and the government’s view is that this is gambling.”
In an all-company memo, Messick, who admits no wrongdoing on behalf of Ironman, explained the decision to settle: “There is an old American saying, ‘You can’t fight City Hall.’ Rather than undertake what we expect would be a protracted dispute with the federal government, we chose to settle and move forward.”
The lead attorney on the case, James Muench from the U.S. Attorney’s Middle District of Florida office (Department of Justice) is a multiple Ironman and Ironman 70.3 finisher, most recently finishing Ironman 70.3 Florida on April 12. (He has never entered the Kona lottery.) Messick says he doesn’t know who or what prompted the investigation, but that Muench has received emails from Ironman promoting the Kona lottery because he’s in their athlete database. There are a number of jurisdictions where similar gambling and lottery games are legal, according to Stranieri – an online Italian gambling informational resource that reviews the latest news and casinos from the region.
Messick offered to immediately shut down the 2015 lottery and refund money to athletes but was told they could operate it through 2015. (Which, he points out, only added to the government’s coffer.) Asked why the settlement funds aren’t being returned to the lottery entrants, Messick responded, “You need to ask the federal government about that.”
There is legal precedent, a case called NCAA vs. George, that Messick says supports the appropriateness of Ironman’s lottery program. In that ruling, the NCAA was legally entitled to hold a lottery for Final Four tickets. “We believe that under NCAA vs. George that we have a strong case that the allocation mechanism for Kona slots is fair and appropriate,” he says.
Ironman isn’t the only company to stage a lottery around a premier athletic event. New York Road Runners, organizers of the New York City Marathon, also conduct a lottery for entry into the world’s largest marathon.
Could they be next for federal scrutiny?
“I don’t know about any other lottery based system, but what I do know is that the federal government acknowledged that in our 30 years we have never failed to provide the lottery slots that we said we were going to provide, and that we’ve never done anything misleading,” insisted Messick.
He also says the government acknowledged that over the years the value of the slots that have been distributed is vastly in excess of the revenue that Ironman generated from it, a fact that should’ve supported their legal case.
“Our eBay slots for the past five years averaged $39,000 per slot so what we’ve generated in revenue [from the lottery] is much, much less than what we could have generated by utilizing those slots some other way,” he says. “And the government said, ‘we understand that is true, but we also don’t care because this is a strict question about whether you are licensed to conduct a lottery.’”
Moving forward, Messick says that one possible route is expansion of Ironman’s Legacy Program, which rewards athletes who have raced 12 or more Ironmans with a Kona slot. (In 2012, Ironman took 100 slots from the main lottery, which up to then offered 200 slots, to create the Legacy Program.) He says the Legacy Program fulfills the founders’ original goal with the lottery, which is “to find the pathway to Kona for athletes that aren’t blessed with great athletic ability.” They are also considering a smaller scale lottery that is free.
Despite the legal and logistical headaches, Messick sees a silver lining in all of this.
“The good news for us is that we are under enormous pressure to find slots for all the people who want to go to Kona, and while we will miss the lottery we’re happy to have the 100 slots back because we believe we can put those to good use for age-groupers.”
Moving forward, I think Ironman should structure their Kona lottery so that you have to complete an Ironman to be eligible to enter a “free” lottery. Kona is an unforgiving race that demands legitimate preparation. Finishing an Ironman that qualifies you to enter the lottery ensures that the lottery isn’t diluted with athletes who aren’t committed to the training or end goal—racing in Kona. I also think they should take a handful of the 100 freed up slots and put them towards growing the female participation base in Ironman through its Women For Tri initiative. The Women For Tri board is developing a variety of programs to attract more women into the sport, and having access to Kona slots would help raise the profile and visibility of the group’s efforts. A lot of people have also suggested using these newly released slots to even up the pro field in Kona (current count is 50 slots for pro men and 35 slots for pro women). I’m a proponent of equal representation of pros in Kona, and while I’m more supportive of a 40-40 breakdown in Kona, I do believe that taking 15 slots from the lottery program and adding them to the pro women’s field can produce positive results for Ironman and the sport at large.