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The amazing and slightly sordid story of Aqua Caliente racetrack, part 1

The Arguello heirs vs. the mighty Alessios

Edward Spector. Banks was suspicious. He had noted Spector’s New Jersey driver’s license and Mexican plates on the Monte Carlo, and he thought he detected signs of nervousness in his behavior. - Image by Patrick Downs/L.A. Times
Edward Spector. Banks was suspicious. He had noted Spector’s New Jersey driver’s license and Mexican plates on the Monte Carlo, and he thought he detected signs of nervousness in his behavior.

The latest chapter in the. strange and turbulent history of the Agua Caliente racetrack in Tijuana began at about 10:30 a.m. last September 13, a Monday. Forty-six-year-old Edward M. Spector pulled into the primary inspection line at the Tijuana border crossing; he was heading into San Diego from Mexico. Immigration inspector Robert McGowin leaned down to the window of Spector’s 1981 Chevrolet Monte Carlo, ascertained that Spector was an American citizen, and asked him if he was bringing anything in from Mexico. According to notes McGowin made at the time, Spector replied, “All I want to declare is money — $20,000.”

“Is that all you have today?” McGowin asked.

“Yes,” Spector answered.

Spector then drove over to the secondary inspection area and filled out the necessary currency-reporting form for $20,000. As he was returning to his car, he was stopped by customs inspector Ernest Banks, who asked him if he was sure he had nothing else to declare. Banks recalls that Spector answered, “No.” But Banks was suspicious. He had noted Spector’s New Jersey driver’s license and Mexican plates on the Monte Carlo, and he thought he detected signs of nervousness in Spector’s behavior. So Banks decided to search the automobile. He opened the trunk of the car, which was registered to the Caliente racetrack, and inside he found two briefcases.

Unlike American tracks, the racing here is year-round (every Saturday and Sunday).

The briefcases were opened and revealed to contain $230,000, all of it in twenty-dollar bills.

Immediately, special agent Dominick Aragona placed Spector under arrest for making fraudulent statements and advised him of his right to remain silent. Spector stated that he was a consultant for the Caliente racetrack and that the money was the property of the track. He refused to say anything more without the advice of his attorney. Officials then transported Spector downtown to the Metropolitan Correctional Center, where he was kept overnight. The next day his wife posted bail for him — $20,000 — and Spector was released.

A San Diego spokesman for the racetrack later said that the arrest was a “misunderstanding,” that Spector had simply brought the money over the border in order to make change for the convenience of the track’s patrons. (The previous month the Mexican government had devalued the peso, lowering its value to 69.5 pesos to the U.S. dollar, and subsequent official decrees prohibited such American currency exchanges at Mexican banks.) Caliente’s San Diego spokesman reiterated that the arrest was a mistake and that Spector had been released from jail the next day. A simple misunderstanding.

Caliente can stable a horse there for about twenty dollars per day, including trainers’ fees.

This official explanation, however, has left a number of questions unanswered. Why, for example, was the money Spector carried only in the form of twenty-dollar bills? A racetrack will, of course, receive a lot of twenties, but common sense would indicate that fifties and hundred-dollar bills — which tracks also receive in abundance — would be more difficult to change for patrons. Why weren’t there any larger bills among those in Spector’s briefcases? Also, since there is no law against bringing money into the United States (though it is illegal not to declare amounts above $5000), why didn’t Spector simply declare the full amount and state his purpose? True, the Mexican government had recently enacted another decree forbidding anyone from leaving that country with more than the equivalent of 5000 pesos, but U.S. officials are not in the habit of reporting such currency violations to foreign governments. So Spector need not have feared being turned over to Mexican authorities once he was on American soil.

And while Mexican law at that time prohibited the average person from dealing in American dollars at Mexican banks, the Mexican government had already granted Caliente racetrack special dispensations during those chaotic months of financial crisis. After all, the track was Baja’s largest employer and it relied on American dollars. There is no reason to believe that the government wouldn’t have accommodated the track's need to make change for American dollars at local Tijuana banks: turn in a fifty and get back five ten-dollar bills.

Few U.S. bookmakers will accept a bet on any horse running at Caliente.

Had Spector or some other official from Caliente wanted to change American dollars for Mexican pesos, however, the exchange rate at Tijuana banks would have been the official 69.5 pesos to the dollar. But just across the border at San Ysidro’s “black market” exchange houses, the rate at that time was about ninety pesos to the dollar. That fact led officials of the labor union representing Caliente employees to speculate that Spector was not crossing over to change dollars for dollars. They believe he was going to change dollars for pesos — at 90-to-l instead of 69.5-to-l — then return to the track to pay employees’ salaries with the cash, thus netting the track’s owners a substantial and easy profit.

These questions, and others, might have been answered at Spector’s trial in federal court, had there been a trial. The United States Attorney’s office, however, decided not to bring Spector to trial. Instead, U.S. officials struck a deal with Spector: they would delay prosecuting him for eighteen months, and if during that time Spector held up his end of the deal, he would then be free to go — no prosecution, no crime, no threat of jail or fine. For his part, Spector agreed to cooperate fully with the customs service or a federal grand jury in disclosing the circumstances surrounding the transportation of the track’s money.

  1. General Esteban Cantu, 1922 (San Diego Historical Society}
  2. Baron Long, 1929
  3. Frank "Booze" Beyer, 1925 (San Diego Historical Society)
  4. Ague Caliente, 1927 (San Diego Historical Society)
  5. C. Arnholt Smith, 1933 (San Diego Historical Society)
  6. Ague Caliente Hotel, 1928 (San Diego Historical Society)
  7. Wirt Bowman, c. 1928 (San Diego Historical Society)
  8. Agua Caliente Casino. 1928 (San Diego Historical Society)
  9. Armando Verdugo. c. 1980
  10. Bruno Paglaia. e. 1940

On February 1 of this year, federal officials in San Diego struck another deal, this one with the Caliente racetrack, known formally as Hipodromo de Agua Caliente. In exchange for no one laying blame for anything or admitting any sort of liability, the United States returned to Caliente the entire $250,000 in cash and the Monte Carlo automobile in which Spector was arrested. Caliente, in turn, handed over to the U.S. a cashier’s check for $45,000. Signing for Agua Caliente racetrack was managing director Raul Baz; signing for the United States was Assistant U.S. Attorney Michael Waltz.

The U.S. Attorney’s office has been unwilling to discuss this unusual affair except to confirm details that are already a matter of public record. Raul Baz and Edward Spector both have declined repeated requests for interviews, so we may never know what really happened. Ah, Caliente. Surely this is the stuff of which legends are made.

The track is located off Agua Caliente Boulevard, just beyond the Tijuana Country Club east of downtown. In appearance, it looks like no other racetrack I have ever seen, and probably for the reason that it was designed by architects who had never before built a track, who specialized in the construction of soccer stadiums and bullfight rings. The architecture has been described as ‘ ‘Spanish-Moorish” or ‘‘Mexican colonial,” but the local Tribune was probably more accurate in labeling it a ‘‘weirdly futuristic Moorish mausoleum.” Once inside, however, things do improve, as the vista of the entire racing oval, framed by a background of green and brown hills — while hardly rivaling the beauty of the Santa Anita track in Arcadia, set before the surging San Gabriel mountains — is at least as agreeable as most American tracks, and quite a bit better than some.

  1. James Coffroth. 1925 (San Diego Historical Society)
  2. President Plutarco Flias Calles. 1941 (San Diego Historical Society)
  3. Jack Dempsey (center) and friends at Caliente, 1923 (San Diego Historical Society)
  4. Governor Abelardo Rodriguez. 1925 (San Diego Historical Society)
  5. Flood damage. February /. 1916 (San Diego Historical Society)
  6. James Crofton. 1926 (San Diego Historical Society)
  7. Eddie Neais. c. 1943
  8. Bill Kyne. 1926 (San Diego Historical Society)
  9. Charles "Rainmaker" Hatfield. 1916 (San Diego Historical Society)
  10. Adolph Spreckets. 1910 (San Diego Historical Society)
  11. Phar lap. Caliente Handicap winner. March 20, 1932

I’ve seen a lot of tracks, having fought the battle of the mutuels and, as they say, assisted in improving the breed for more than a few years, from the great betting factories of Belmont and Aqueduct in New York to the small and friendly county-fair tracks in northern California, where both the horses and the bettors are put through their paces while enduring the baking heat of summertime in the San Joaquin Valley. On several occasions over the years, I’ve even published my views and opinions on horses and handicapping for racing and trade journals. All of which is intended to preface with some experience my opinion that Caliente is not a bad track. I enjoy the place.

Caliente encompasses many of the advantages of the county-fair tracks, and adds a few of its own. Unlike American tracks, the racing here is year-round (every Saturday and Sunday) and the weather is usually salubrious. There’s lots of space at Caliente — plenty of free seating, and relatively inexpensive reserved seating. There’s none of the frantic and often rude pushing and shoving one encounters at the overcrowded meets at Hollywood Park, Santa Anita, and Del Mar. A Caliente bettor can actually get a free seat right on the finish line, if he doesn’t mind sitting in the sun for part of the day.

  1. John S. Alessio, 1963 (Photo. Roy Robinson)
  2. Rita Hayworth, 1956
  3. Russell Alessio, 1950
  4. Agua Caliente (Photo: Ted Lau)
  5. Eddie Arcaro, 1950
  6. Agua Caliente (Photo: Jack Yon)
  7. Desi Amaz, 1951 (Photo: Bill Scherlis)
  8. Joann “Miss San Diego ” Durant at Caliente, 1950

The cost of food and drink is reasonable, again compared to the overpriced concessions at the Southern California tracks. Nor do the usually cordial people at Caliente who serve up the beer and hot dogs set out the presumptuous, vaguely intimidating, and thoroughly offensive ‘‘tipping cups” that decorate the counters at the California racing tracks.

The horses at Caliente will run eleven, sometimes twelve races a day on the weekend. There are about 1200 horses stabled at the track at any one time, owned by both Mexicans and Americans, and the people who train them likewise come from both countries. For example, Wayne Spurling, who runs a sizable breeding farm in Imperial Beach but lives in Tijuana, more often than not tops the annual trainers’ lists at Caliente.

Economic realities prevail, of course, and thus the horses that compete at Caliente are of considerably lesser quality than those racing at the big California tracks; this is because the purses that Caliente offers to the owners of the winning horses are not as lucrative (although they were hiked a substantial forty percent in February in an effort to attract better stock). A thoroughbred that shows a touch of quality at Caliente is usually shipped north to try its luck for the bigger purses. However, Caliente’s attraction to owners is that they can stable a horse there for about twenty dollars per day, including trainers’ fees, compared to forty-five or fifty dollars at the Los Angeles tracks.

The wagers on horse racing at Caliente are made through clerk-operated parimutuel machines, with the odds determined by the amount bet on each horse. The total amount bet on each race, and on the entire program, is called the “handle.” From the handle the track extracts a percentage (twenty-six percent, known as “the take”) to cover purses, profits, and taxes. Bettors, in other words, don’t bet against the track; they bet against each other, with the track — in effect — charging a fee for holding the stakes and staging the show. This is common to all racetracks.

The greyhounds run at Caliente six nights a week, along with the recently added matinees on Wednesdays and Fridays. About 800 to 900 dogs are kenneled there at any given time. The dog purses are a flat three percent of the total “handle” for each particular race. According to Paul Hartwell, who has been director of greyhound racing at Caliente for more than twenty years,-most of the money that comes into the greyhounds is bet by Mexican citizens (the track will accept pesos as well as dollars). The situation is reversed at the thoroughbreds, however, with the great majority of the money wagered coming from Americans.

A third form of Caliente wagering takes place at the Foreign Book. Here the players can make a bet on races taking place at any of five or six American tracks, from those operating in New York or Florida or Maryland, to whatever California tracks happen to be running. Winning tickets are cashed at the same price paid at the individual track, with certain limitations, and with the Mexican government grabbing a one-percent tax on all winning bets (a year ago it was an exorbitant five percent). Caliente currently operates Foreign Books both at the track and in downtown Tijuana near Fourth and Revolucion, as well as in Mexicali, Tecate, and Ensenada.

These Foreign Books are Caliente’s most profitable enterprise. According to track insiders, the five books combined bring in an estimated $600,000 per week, about nineteen or twenty percent of that being profit. The expenses of running a book are minimal, as there are no purses to pay out and no track to maintain. The greyhounds also produce a nice profit, as purses and operating expenses are considerably less than they are for horses. Caliente’s live horse racing is, in fact, currently losing money, and is — essentially — being carried by the Foreign Book and the greyhounds.

Hugh Mellon is Caliente’s corporate marketing director. He is familiar with all these forms of wagering, and offers his personal assessment of the different kinds of patrons who visit Caliente: “The smartest handicappers [bettors who wade through the past-performance hieroglyphics in the Daily Racing Form in the attempt to determine the probably winner] stick to the American tracks, the Foreign Book; next, those who play the live horse racing at the track; at the bottom, in my opinion, are the dog players. It’s almost impossible to handicap a dog race. ’’ Mellon laughs. His background is strictly with horse racing. Some of my dog-playing friends, though, would dispute Mellon’s claim that they’re on the bottom. “Never bet anything that talks, ’’ the dog players sagely counsel, and they usually turn up their collective noses at jai alai wagering and the jockey-burdened horses as well. (The Jai Alai Fronton in downtown Tijuana has no connection to Caliente.)

The Foreign Book players are certainly a varied lot, but senior citizens are somewhat overrepresented. For the retired person who is a regular at the Book, trying to select a winning horse beats the hell out of playing bingo as a hobby. They obviously enjoy the creative challenge of handicapping, of solving the puzzle each race presents, and of occasionally enjoying the rewards of being right.

How does Caliente treat its Foreign Book patrons? In my opinion, not very well. A Los Angeles Times reporter felt otherwise, however, as he stated in a story published last August. “There are more amenities at this facility than you would find in any of the hundreds of state-run Off-Track-Betting parlors in New York. The OTB [operators] don’t provide a snack bar, they don’t have chairs, they don’t have an easily viewed master-results board, and they don’t post past-performance pages from the Daily Racing Form, as the Foreign Book does.”

It is difficult to understand why a Los Angeles writer would seek a comparison so far afield as New York, when large numbers of Angelenos and San Diegans are quite familiar with gambling much closer to home — in Las Vegas. There are numerous privately owned books throughout that town, and a number of Strip hotels also have separate sections for horse bettors. Consider the one at the Stardust Hotel. Each player at the Stardust gets a separate lighted desk, in contrast to the somewhat uncomfortable plastic chairs at Caliente. At the Stardust there is not only an easy-to-read master board but a tape-delayed actual call of the race from California tracks, lacking at Caliente. The Stardust will usually give the player a Racing Form (as will most of the books in Vegas) and not, as Caliente does, tack one or two copies of the Form to the wall, where players who choose not to purchase their own (for $1.75) must stand three deep in order to get a peek at the past performances. Players in Las Vegas are often given free drinks and sometimes a meal on the house. This practice is completely unknown at Caliente. The restrooms in Vegas are usually immaculate; at Caliente, particularly at the Foreign Books downtown and at the track, they can charitably be described as unpleasant. Parking is normally free in Vegas; you must pay at the downtown book and also at the track book on weekends. And, of course, Vegas does not tax winning tickets. Caliente seems to operate on the-only-game-in-town philosophy: there is no legal competition in the area. Hard-core bettors will swim rivers to get there, but it’s difficult to believe that Caliente’s Foreign Book is going to get (or keep) the casual tourist out for a bit of gambling recreation.

Another of Caliente’s unfortunate problems is the track’s share of all bets made, the mutuel take of twenty-six percent, which is outrageous when compared to the less than sixteen percent in California. In Mexico, each time you wager a dollar on live racing, twenty-six cents is taken off the top. While it’s true that the average player does not understand such complexities, he does understand that his money just does not seem to last as long at Caliente.

Hugh Mellon, an experienced track executive, candidly acknowledges the track’s deficiencies: “Numerous studies have shown, time and again, that two things stand out as having the greatest importance in the successful operation of a racetrack. One is the physical facility, and yes, including the restrooms. Frankly, I myself would never use those at the track. The whole place, the Books particularly, and that downtown facility above all, are terrible. We are going to make improvements. Also of great importance is the mutuel take — the higher it goes, the lower your ‘handle’ goes. Studies show that to be inevitable. All state governments believe that racetracks are the geese that will never stop laying those golden eggs, but that’s wrong.

It’s a matter of educating the government,” Mellon says that he’d like to see the mutuel take lowered, and back in February he told me that the track would soon be spruced up, but alas, neither has yet come to pass.

What has come to pass, though, with the arrival of Edward Spector and Hugh Mellon and many others working for the current owner of the track, is another piping-hot serving of that good old Caliente controversy, continuing a great tradition which started a long, long time ago. Back in 1909, all horse racing in California fell victim to an antigambling reform movement, and those in the state connected with the sport — inspired by the well-known success of the Juarez track across the border from El Paso — decided to build a track in Tijuana and exploit its proximity to Southern California population centers. A group of men headed by San Francisco boxing promoter James (Sunny Jim) Coffroth undertook the job of construction and management of a new racetrack in Tijuana. One of the principals was William Kyne, who twenty-five years later would build the Golden Gate Fields facility near San Francisco. Another participant was Frank (Booze) Beyer, owner of the nightclub and gambling hall in Mexicali known as the Owl Cafe. (Beyer later gained a sliver of immortality by having a South San Diego boulevard named after him — probably owing to his donation of a fire department and a library to the village of San Ysidro.) Beyer joined with bar and casino owners Marvin Allen and Carl Withington to form the ABW Corporation, which underwrote the book betting at the new track. Baron Long, executive director of the LJ.S. Grant Hotel and the owner of the Sunset Inn casino in Tijuana, also had a piece of the action. These entrepreneurs, known as the Border Barons, were easily the most important businessmen in Baja California at the time, and for several years to come. Much of the detail surrounding those early days in the formation and operation of the track has passed on with the principal actors. But among those who have attempted to chronicle the initial years of Tijuana racing is San Diego author and historian Roberta Ridgely, who knows more about the first two decades at the track than anyone else alive. Her work was published in San Diego Magazine between 1957 and 1971. Even Ridgely’s excellent research, however, would have benefited from more first-hand, candid reminiscences. But nearly all the Border Barons, including Sunny Jim Coffroth, had died by the time Ridgely began her work.

Coffroth had little interest in horse racing as a sport, but he had a genius for promotion, plus numerous contacts among horsemen, journalists, businessmen. He obtained a major portion of the financing to build the Tijuana track from Adolph Spreckels, whose family — he was the brother of John D. Spreckels — for decades after made strong denials of the old man’s involvement. Spreckels was a horseracing buff and the owner of the Napa Stock Farm. He felt that Tijuana racing might help to return the sport to California; an added incentive may have been the fact that he owned the railroad spur to the border and needed an attraction like the racetrack to encourage people to make the ride to what was then a “desolate, scattering, wind-swept village,” as a Los Angeles Times writer described it at the time.

At the time the track was being built, General Esteban Cantu was in effective control of Baja California. He had been sent to the area in 1911 by the Mexican government to drive out the Americans who had come to Mexico to assist the revolution. Although the new revolutionary government in Mexico City vetoed the racetrack idea.

Cantu, strongly of independent mind, was all for it, so construction proceeded on schedule. On January 1, 1916, the track, with a wooden grandstand, sparkling white fence, and 114-foot-long liquor bar, opened for business less than a quarter mile from the border crossing. (The site of the track is now partially covered by the freeways and by the Tia Juana River canal.) Coffroth’s friends in the press helped publicize the event and 10,000 people showed up on opening day. Many of the attendants at the track were dressed in the uniforms of the 1915 San Diego Exposition, which had been sold to them by the ill-paid Expo guards. General Cantu was there with his mounted cavalry. Jim Jeffries, Frank Fay, and Mack Sennett were a few of the notables of the era in attendance, and boxing great Jack Dempsey served as honorary starter. Coffroth always made sure the media was informed whenever film stars and sports celebrities journeyed to his track, and hundreds of them did so in the ensuing years.

On the day the track opened, it started raining again after a long drought. At first this seemed an auspicious omen, but the rain didn’t stop. It turned out to be one of the worst floods in Southern California history, which some believed had been brought on by a self-proclaimed magician known as Hatfield the Rainmaker, who had been hired by the City of San Diego to end the drought. The waters rose and the Tia Juana River flooded into the newly opened racetrack. Coffroth was undeterred; he obtained from Adolph Spreckels more money to rebuild the track. “Take it from me,” Coffroth proclaimed to the press, “Tijuana, with San Diego so close, is the ideal place for the Sport of Kings.”

The rebuilt track (at the same location in the river bed) was officially called the Sunset Racetrack but usually known simply as “the Tijuana track.” Quickly it prospered, and after a government-imposed hiatus during World War I, business picked up again — better than ever. Thousands of thirsty Californians took to fleeing for a few hours the Great Prohibition Experiment which struck America in January of 1920. It was actually during Prohibition (1920-33) that Tijuana gained its reputation — which still lingers today — as a town that catered to all the vices legally beyond the pale in the U.S., but which the gringos were eager to explore. The track benefited hugely by this flow of visitors, as did the Tijuana Fair, Sunset Inn, Tivoli, and the Foreign Club — gaming casinos all.

Criticism of the wild goings-on across the border came early. For example, the Women’s Christian Temperance Union, meeting at a Methodist Church in downtown San Diego, issued the following sober proclamation: “The racetrack at Tijuana, Mexico, with its well-known gambling evils and attendant debauchery, is a terrible and increasing menace to the homes of this and other states, degrading young men and ruining young girls.”

In 1926 Will Rogers visited Tijuana and reported back to the nation. “Well, they are having a big stir all over the U.S. about Tijuana and Mexicali,” he wrote. “It seems they sell drinks down there right over the bar . . . and they gamble there right before your own eyes. And they claim it is ruining the youth and manhood of this country. That it is a disgrace to have these things done right there in Mexico, where the Americans can go right over and see all this. Americans don’t want to drink and gamble. They just go over there to see the mountains, and these scheming Mexicans grab ’em and make ’em drink and make ’em bet and make ’em watch the horse races for money. It seems that Americans don’t know these places are over there at all, and when they get there these Mexicans spring on ’em and they have to drink or the Mexicans will kill ’em. . . .

“You put a church in every building where there is a gambling house and saloon now in Tijuana, and I lay you a bet there wouldn’t be five people across that line a year. ...”

Ring Lardner, another humorist of the time, also made a visit and wrote, “When you get ready to go home in the evening, that is, to San Diego or Coronado, two or three officials of one kind or another stops your car at the border and glances in the tonneau with the same amount of attention as is lavished on a snowflake in Minnesota, and then motions you to go ahead. What they are looking for I could not find out, but with the time and pains they take for the search, it seemed to me like a person could smuggle in a herd of elephants in the back seat of one Ford, with every elephant playing the ‘Marseillaise’ on a calliope.” When the track and the border reopened after being closed during WWI, business was so profitable that some of the early investors, headed by Bill Kyne, mounted a legal drive to deprive Coffroth of control. Kyne’s group sued Coffroth for half a million pesos, and when things began to go sour in court for Coffroth, he would sometimes sleep in the clubhouse, fearing that if he left he would be barred from re-entering his own track. Matters grew even more tense when one of his faithful aides was murdered in the track infield by assailants unknown. Coffroth finally managed to bring in a Mexican federal magistrate from La Paz who decided in his favor.

The W of the ABW Corporation was Carl Withington, who had developed key political connections in Mexico City. When he died in the mid-1920s, his place was taken by Wirt G. Bowman, who was also locked into the political power in the Mexican capital. During the Mexican revolution. Bowman had built up his political influence by running guns to the revolutionary hero Alvaro Obregon and to his generals Plutarco Elias Calles and Abelardo Rodriguez, all later to rise to the presidency of the Mexican Republic.

According to Luis Tames, president of the Tijuana Historical Society, Rodriguez, then governor of Baja California and acting in conjunction with Mexican President Plutarco Elias Calles, approached his friend Wirt Bowman in 1926 with the proposition that he — Bowman — build in Tijuana a large and magnificent casino on land that Rodriguez held title to. Bowman accepted the invitation, and together with his racetrack partner Baron Long, set about constructing a palatial complex of buildings.

The land that Rodriguez owned — or thought he owned — near downtown Tijuana had had a colorful history, and proved to be turbulently controversial for years to come. It was part of thousands of acres granted to Don Santiago Arguello by the Spanish crown in 1829. Arguello was governor of California before this area became part of the United States, and much of his property covered an area that includes a goodly portion of contemporary San Diego County. (The Arguello family name, incidentally, appears in Richard Henry Dana’s classic Two Years Before the Mast.)

In 1926 one of the Arguello family heirs, Alejandro Arguello, sold a sizable chunk of the land in Tijuana to Rodriguez, for the equivalent of $35,000. Immediately after the sale, Rodriguez made his casino proposition to Wirt Bowman. But three years later the other Arguello family heirs, contending that they had not been consulted regarding the sale, took the matter to court, and there it remained for more than four decades, involving in the process three major Mexican Supreme Court decisions, and making a number of Mexican lawyers wealthy along the way. The legal fight was led by a Mexican-American woman named Susana Lucero Viuda de Regnier, a cousin of the Arguellos who had purchased a major share to the land claim. Senora Lucero declared, “It has taken us years to prepare for this and we are prepared to spend several more years before we finish. It is a hard fight, and I am not deluding myself or anyone else.” She later began to refer to herself publicly as “Tijuana Susie,’’ as she felt that she was Tijuana’s biggest landowner.

Despite the legal entanglements, in June of 1928, Bowman and Long opened their opulent Agua Caliente Hotel and Casino, a pleasure dome of baroque elegance designed by a young San Diego architect named Wayne McAllister. Vogue magazine described it as “a dazzling, dreamlike city in miniature.’’ Roberta Ridgely, who visited the place as a child, said that it was the closest thing to Shangri-la she had ever seen. Next to the casino, and operating as part of the same development, was a greyhound racetrack, which had been created a year earlier by the Tijuana Kennel Club. Later, a modem golf course was built across the street. (The casino, of course, is no more. A school now occupies the original site, a block off Agua Caliente Boulevard, just to the rear of the El Sombrero Motel. Except for the Arabian-style minaret left standing lonely against the sky, hardly anything now remains of the old casino.)

Bowman, Long, and their partners also decided to abandon the old riverbed racetrack and open a new and classier track, which they did the following year, on land where Agua Caliente is now located. Bowman’s political connections in Mexico undoubtedly aided in the acquisition of all the proper licenses. Coffroth was supposed to run the new track but was soon effectively cut out (“They kissed me off,’’ he said later), and James Crofton became Caliente’s general director. Crofton boasted a motley career: shipyard mechanic, public relations work for the San Diego Expo, Ringling Brothers circus clown, and publicist for the Tijuana bullring, as well as for the Coffroth track — his duties for the track included riding a horse around San Diego while dressed as a jockey.

Coffroth left racing altogether and retired to his home in Point Loma, where he cultivated the arts and prize-winning dahlias for the remainder of his life. One of his local legacies — in addition to the racetrack — is the Star of India. When a committee was formed to raise the $9000 required to bring the old sailing ship to San Diego, its representatives went first to Sunny Jim, who wrote out a check for the full amount. When Coffroth died in 1943, the San Diego Union wrote that “the city not only lost a man — it lost an institution.”

The onset of the Depression (in 1929) and the end of Prohibition (in 1933) at first failed to diminish the volume of visitors to the twin gambling emporiums (there was, Roberta Ridgely says, actually a secret tunnel connecting the track with the casino — they were about half a mile apart). Among the noteworthy visitors then were Baron Rothschild, Jack Dempsey, Babe Ruth, Clark Gable, Mary Pickford, Douglas Fairbanks Sr., Wallace Beery, Charlie Chaplin, Jack Johnson, A1 Jolson, Bing Crosby, the Marx Brothers, Stan Laurel and Oliver Hardy (Hardy was reputed to be a heavy horse bettor), and many more. The track itself had weekends when it drew close to 100,000 people.

However, the legalization of horse racing in California in 1934 (and the opening of the big Santa Anita track in Los Angeles) did serve to reduce substantially the number of patrons — and the quality of competing horses as well, since many owners decided to take their stock up north to compete for the more lucrative purses. Many also lost confidence in the track when Baron Long created a scandal with the “Linden Tree affair” in January of 1932. The thoroughbred Linden Tree looked like a cinch to win a maiden race; if the horse won, however, bettors wouldn’t claim much because Linden Tree was so heavily favored. But after Long had manipulated the wagering odds by placing large bets at the track against Linden Tree (while secretly placing much larger bets in favor of Linden Tree at American bookmaking establishments), the horse, which did win, paid a whopping $21.40. Linden Tree probably would have paid no more than four dollars had Long’s wagering not changed the odds. The incident caused an uproar in American betting circles, and to this day few U.S. bookmakers will accept a bet on any horse running at Caliente. Long allegedly gave most of the money he won in this coup to a Methodist charity, including $8500 to a mission on Fifth and Island in downtown San Diego.

In an effort to regain the confidence of bettors, the Caliente stewards barred Baron Long from his own track for a while, and when the ban was finally lifted, he too had become disenchanted with horse racing and had donated his renowned breeding ranch to an Indian tribe. Then James Crofton soon left Tijuana, to train horses in New England. Also around this time 20th Century Fox president Joseph Schenck — a regular at the track and casino for years — bought a large share of stock from Long, which effectively made him a partner.

In 1934 Lazaro Cardenas was elected President of Mexico. Plutarco Elias Calles, prevented by law from succeeding himself as president, had nonetheless kept control of the government by hand-picking Cardenas as the candidate of the dominant political party, thus assuring Cardenas’ election. (Calles also selected members of the new president’s cabinet of ministers.) However, Cardenas soon broke with Calles, installed his own cabinet, and began to move in directions Calles denounced as “radical.” One action Cardenas took was to close up the casinos and brothels throughout Mexico, in many of which prominent Callistas had financial interests; Calles himself owned part of the Agua Caliente casino. Supporters of Calles, members of a quasi-fascist street movement known as the “Gold Shirts,” were still active in Mexico, so to forestall a possible coup attempt, Cardenas exiled Calles to the United States. Calles’ friend Wirt Bowman left the racetrack and retired to Arizona, from where he became a power in Democratic national politics. A strange quiet settled over the casino and the track. Then both were shut down in July of 1935. A great era had ended.

In the relatively short history of horse racing in Tijuana up to 1935, the Border Barons who organized the operations claimed an enviable number of precedents. They were the first to offer a $100,000 purse (the Coffroth Handicap in 1928), to have Sunday racing (in 1933), to have a photo taken at the finish line (1922), to have the running of a race announced over the public-address system (1925), to use a sprinkler car to wet down the track, and to present female jockeys (the first “Powder Puff Derby”). Judge George Schilling, a fixture at West Coast tracks for more than half a century, was responsible for several of these innovations.

Some remarkable horses also competed during those early years in Tijuana: Exterminator, Calaris, and others, including the Australian champion Phar Lap, who won the Caliente Handicap in 1932. This horse, of gigantic stature, is considered by some to be the greatest ever to run. Unfortunately, he died of colic a few weeks after his big win, thereby contributing his bit to the legend of what Roberta Ridgely has called the “jinx track.”

The Agua Caliente casino never reopened, but in 1937 the Mexican government permitted the track to resume operation, and a parade of different people took possession of the concession license in the next few years. There remains some confusion regarding exactly what happened when the racing started up in 1937. The late Diego Herroz, who until his death recently was interior secretary of the Sindicato Alba Roja, the union that represents racetrack employees, said that Mexican President Cardenas, upon reopening the track, gave the concession, or permit, outright to the Alba Roja union. Herroz recalled that leaders of the union, after considering the implications of full responsibility for the track and deciding that they lacked the proper expertise to manage the enterprise, sold the operating rights. Herroz said he could not recall and could not discover to whom the license had been sold. This account, however, is contradicted by Armando Verdugo, who at seventy-six years of age may know as much about early Caliente history as Roberta Ridgely.

Verdugo moved from Hermosillo, Mexico to San Diego when he was a child; his father was in the Mexican consular corps here. The young Verdugo attended school in San Diego, but by 1924 had begun working in Tijuana, where he became personally acquainted with virtually all the characters in the Caliente drama — Coffroth, Long, Bowman, Abelardo Rodriguez, Crofton, and many others. He worked at the Agua Caliente casino from the day it opened until the day it closed; and later, Verdugo himself became an important part of Caliente history. Today Verdugo lives in Tijuana in comfortable semiretirement; as a business venture he currently leases video-playback equipment from a storefront in downtown Tijuana.

Verdugo recalls that Baron Long and his remaining partners still controlled the government concession when the track resumed operation in 1937 and that Long appointed a man named Bruno Paglaia as general manager. Paglaia, who had worked for Long at the casino, then approached Verdugo and, according to Verdugo, said, “Listen, Armando, I know where the horse’s head is supposed to be and I think I know where the tail is, but that’s about all. Don’t leave my side until I know what I’m doing.’’ Verdugo says he counseled Paglaia for six months but by that time Baron Long had realized his mistake in appointing the inexperienced Paglaia and had begun looking around for some good excuse to replace him.

Verdugo says that he unintentionally provided Long with the excuse he needed when Paglaia asked him, Verdugo, how he might ingratiate himself with Manuel Avila Camacho, the presidential candidate sure to win and succeed Lazaro Cardenas. Paglaia accepted Verdugo’s suggestion to send Camacho a racehorse, and Verdugo took it upon himself to find a suitable horse at a price Paglaia was willing to pay. A Tijuana restaurateur named Nick Parras had a gimpy but well-bred animal called Sun Pilot, and was asking $5000 for him. “Nick,” Verdugo told the owner, “this horse only has three good legs. Here, I’ll give you $3000 cash.” Verdugo pulled a wad of twenty-dollar bills from his briefcase and closed the deal. The horse was promptly shipped off to Camacho.

Shortly thereafter, Baron Long wrote Paglaia a letter dismissing him from his duties as general manager because, the letter stated, Paglaia had compromised the integrity of Caliente by getting mixed up in Mexican politics. This, of course, was a laughable pretext, considering the history of the track and casino and the number of politicians who had been participants in both. Long then appointed Enrique Neidhart as general manager, but the track soon became entangled in problems with the Alba Roja labor union and closed its doors once again in 1939.

Baron Long, by this time having had his fill of the entire enterprise, decided to retire. According to Verdugo, Long simply gave the rights to the track to a group of associates and former employees that included general manager Neidhart. However, Neidhart and his partners (one of whom, Alfonso Garcia Gonzalez, was later to become Governor of Baja California) feared that with the onset of World War II they would not be able to make a profit running horse races. The labor problems had been resolved, but rather than risk operating at a loss, Neidhart never staged a race and instead let the track lie fallow.

With the closing in 1939, Armando Verdugo found himself unemployed. Before long, though, he was working again. Through the aid of a friendly Los Angeles police detective, Verdugo was hired as a roulette croupier in an illegal Los Angeles gambling club called the Clover Club, owned by a man named Eddie Nealis. While working at the Clover Club, Verdugo became friendly with well-known gangster Benjamin (Bugsy) Siegel, a patron of the club and a friend of Nealis. Verdugo says that Siegel was interested in the dormant racetrack in Tijuana and asked if Verdugo would help him arrange to purchase it from Neidhart.

Verdugo says he declined to assist Siegel but that Siegel proceeded on his own and sent a Boston lawyer to Tijuana to negotiate with Neidhart. “This lawyer,” Verdugo recalls, “didn’t understand Mexico or Mexican law, and wasn’t able to make any / headway. So the deal there fell through.” (Siegel went on to build the first of the flashy Las Vegas Strip hotels — the Flamingo — and in 1947 was murdered gangland-style in Los Angeles.)

Unlike Neidhart, Verdugo believed that Caliente could be opened up again and be successful — war or no war. So he began talking with Nealis about the possibility of forming a partnership to buy it from Neidhart. After determining that Neidhart and his associates were indeed interested in selling the track — and for a mere $100,000 — Nealis, Verdugo, and a few other investors put $25,000 down and started Caliente racing again in May of 1943.

The track had been open only about a year when James Crofton once again appeared on the scene. Amid great controversy, Crofton announced that he and several partners were legally in control of the track. Verdugo recalls that Crofton had developed an association with a Tijuana businessman named Augustin Silverya, who had been a dealer at the old casino. Silverya was among a group of influential men who had been representing Susana Lucero and the ubiquitous Arguello heirs; the heirs finally had won a major victory in the Mexican Supreme Court, and Silverya, Crofton, and the others in Mexico City claimed to have leased from the family the right to run the track — which they said they intended to do, regardless of Eddie Nealis and Armando Verdugo.

Verdugo says that he hustled off to consult with Baja California Governor Rodolfo Tadoada in an effort to determine if anything could be done to prevent Crofton, Silverya, and the Arguello heirs from seizing the business. “Tadoada said to me, ‘Armando, you don’t really have a case. The only thing you may be able to do is to sue for the improvements you’ve made to the property.’’ Nealis and Verdugo thereupon filed a two-million-dollar lien on the racetrack property. The Arguello heirs were unaware of this lien when five or six of them, led by Susana Lucero, met at a government office in Tijuana to complete formal transfer of the Caliente property. Nealis and Verdugo were present at that meeting and had already informed the presiding government official that they had legally placed a lien on the property. The official dramatically announced to Lucero and her relatives that while they may have “judicial” or technical rights to the track, because of the lien, the operating rights would remain with Nealis and Verdugo. The heirs had once more been frustrated in the attainment of their goal, and their disappointment and anger must have been intense. Susana “Tijuana Susie” Lucero died the next day.

The remaining heirs, of course, were not about to be dissuaded for long by Verdugo’s legal ploy; they returned to Mexico City to have the lien voided, and late in 1945 finally gained control of the racetrack. Perhaps it would be more accurate to say that the lawyers and politicians in Mexico City who had “represented” them had gained control of the track. Among those who seemed to be in true control were Augustin Silverya, Gonzalo Gonzalez, and Enrique Parra. Gonzalez and Parra, both from Mexico City, had close political ties to President Camacho. The Arguello heirs, according to Verdugo, received hardly anything, “except a free meal at the track now and then.” Silverya (who had by now broken with Crofton) claimed to have a twenty-five-percent share of the Caliente concession, and moved in as general manager. Verdugo and Nealis were out.

Silverya apparently had difficulty operating the track. According to Nelson Fisher, former racing correspondent for the San Diego Union who was working for Silverya in the track’s PR office at the time, some of the problems Silverya was having resulted from his diverting track money into an unsuccessful restaurant in downtown Tijuana, and also into the wining and dining of Hollywood starlets. Silverya needed a competent assistant if the track was to run profitably and if his associates in Mexico City were to remain content. He turned for help to the former manager of the Banco del Pacifico, where the track had been doing its banking. Silverya had admired the skill of the bank’s youthful manager, who had recently resigned from his position there following disclosure of some large and controversial loans he had approved. In a fateful decision, Silverya asked the former manager to join the Caliente organization as assistant manager. Within months, Silverya would end his career in racing and a new era would begin at the track. The young man Silverya hired and who set about changing the history of Agua Caliente was John S. Alessio.

John Alessio’s rise from poor boy to one of San Diego’s most prominent citizens is “the stuff of which movies are made,” wrote the San Diego Union in 1963. He is, the paper went on, “a business and civic leader of the first magnitude. In many parts of Mexico he is considered almost a saint.”

The poverty-stricken Alessio family arrived in San Diego from West Virginia just after World War I. John, one of seven brothers, dropped out of school after the seventh grade and wound up shining shoes in the old Crystal Palace Building downtown at the corner of Fifth Avenue and E Street. Fortunately for him, he had developed a friendship with C. Arnholt Smith, then associated with the Bank of Italy (where, incidentally, the Border Barons of old kept most of their money). When the Crystal Palace Building was scheduled for demolition in the late Twenties, Smith got Alessio a job in Tijuana’s Banco del Pacifico as a messenger boy. Armando Verdugo remembers meeting Alessio in 1929 when the young bank messenger showed up at the back door of the counting room of the Agua Caliente casino. Verdugo opened the door and Alessio said he was there because he was supposed to take the night’s receipts over to the bank. Verdugo recalls, “I said to the casino manager, ‘Hey, there’s a young kid here who says he’s from the bank,’ and the manager told me it was okay. That’s the first time I saw John Alessio.” By 1943 Alessio had risen from messenger to manager of Banco del Pacifico.

If Alessio had favorably impressed the bank’s owners, he also impressed Augustin Silverya and Silverya’s partners in Mexico City, quickly gaining their trust and confidence. Alessio’s old friend Armando Verdugo recalls what then took place. Within a year of being hired as Caliente’s assistant manager, Alessio offered to purchase Silverya’s interest in the racetrack. Silverya was eager to sell. The price for his twenty-five-per-cent share was $80,000. Verdugo says that within a few months Alessio had persuaded the remaining partners in Mexico City to sell him their shares, for an undisclosed sum. Less than a year after those purchases, Alessio struck a deal with the track’s former operator, Enrique Neidhart, who still maintained a claim to the property upon which the track was built. Neidhart, for an unknown amount of money, sold out to Alessio. who now effectively had complete control of the Caliente racetrack as well as the surrounding property. The money needed to finance these purchases came from within the Alessio family, but because John Alessio declined several requests to be interviewed for this account, the exact source of that money cannot be confirmed.

Armando Verdugo recalls that a sizable portion of the money at Alessio’s disposal had come from an extremely profitable money-exchange business Alessio had set up on this side of the border while he was still employed by Banco del Pacificio. During World War II, the U.S. government had prohibited tourists from taking into Mexico any currency other than unpopular two-dollar bills, for fear that Axis powers might somehow obtain American dollars and use them for nefarious purposes. Alessio took advantage of the situation by offering to Tijuana tourists a supply of two-dollar bills — for a ten-percent service charge. When the supply of two-dollar bills began to dwindle and as the racetrack opened up again in 1943. the rush of tourists (many of them military personnel newly moved to San Diego) demanded an alternative to hard cash. So Alessio, in conjunction with his early mentor C. Arnholt Smith, produced for tourists bank script that soon was accepted throughout Tijuana, including at Agua Caliente racetrack.

About a year after Alessio began his acquisition of the track, he and seven other former executives of Banco del Pacifico were arrested on bank fraud charges arising from the controversial loans that had led to Alessio’s resignation from the bank. The men were locked up in the Tijuana jail, where they remained for 117 days. The same men, including Alessio, also came under indictment from a California grand jury, due to a series of related loans that involved a San Francisco company and a former governor of Baja California. Eventually the former bank officials were released from the Tijuana jail without being charged and the California indictment was dropped as well.

With these problems behind him, Alessio was free to pursue his efforts to turn Caliente into a moneymaking operation. (He kept his ownership of the track a secret, however, and the general public was led to believe that he was still just the assistant manager. The track’s manager, hired by Alessio, was the well-respected racing expert Walter C. Marty.) In time, Alessio would enjoy the results of his hard work and innovative thinking as the track prospered under his reign. But before the good times rolled in, Alessio was rather rudely introduced to the Arguello clan, a group of people who could apparently give a bulldog some lessons in tenacity.

In 1949 several hundred of the dissident heirs, now banded together, had unsuccessfully sued the track for a share of the profits, claiming that their property rights had been ignored when Alessio bought out Enrique Neidhart. Then in 1954, armed with a court order from Mexico City, which they interpreted as giving them legal control of the track, they physically occupied and took possession of Caliente. Alessio later told the Saturday Evening Post, “When I came to the track at nine, they [the Arguello family members] wouldn’t let me through the gates. They claimed the place was theirs. I went to Tijuana and got a restraining order from a federal judge, barring the heirs from the property until the matter could be argued in court.’’ As a stalling tactic, Alessio couldn’t have hoped for anything better: the matter of the Arguello family claim was tied up in court for another twenty years.

In the meantime, Alessio elevated himself to the position of general manager and initiated a number of promotions and gimmicks that proved to be tremendously successful. His master stroke was the 5-10, inaugurated in 1955 and patterned after a similar wagering system used at a track in Venezuela. The 5-10 required a player to select the winners of the fifth through tenth races on the program. (Many American tracks have since copied this type of exotic wagering and refer to it as the “Pick Six.’’) The payoffs were phenomenal — $50,000, $100,000, and more — unheard of in North America at that time. The publicity engendered by the 5-10 brought national attention to Caliente, and attendance rose accordingly.

Johnny — as he was affectionately known to his patrons — exhibited his flair for promotion in many ways. He allowed the ordinary man access to the beautiful clubhouse and permitted him to dine at a private table while watching the races. (The food and drink at Caliente were both excellent and reasonably priced.) He installed the attention-getting “Future Book,’’ in which players could make bets on the Kentucky Derby months in advance. He put on a Kentucky Derby party billed as “the largest west of Louisville.’’ He distributed free passes to the track at almost every liquor store in San Diego. He put one-dollar coupons in the newspapers, which when clipped and presented at the track, were good toward a two-dollar bet. On one occasion he drew a tremendous crowd by setting up a “match race’’ between Johnny Longden, the world’s winningest jockey, and a female rider named Wantha Davis. (Longden left the track in a huff when the lady won the race.) In 1958 Alessio boasted that Caliente’s ads and promotion budget ($400,000) was the highest of any track in the world. He gave to the Saturday Evening Post his frank philosophy regarding his successful operation: “Racetracks were never built to benefit the players. At Caliente, we just try to arrange a good time for him while he’s losing.’’

Alessio had the foresight and good sense to keep the press happy. He maintained a good relationship with publisher James Copley, which was helped by his friendship and business association with C. Arnholt Smith, himself by now a financial power in the community. Nor did Alessio forget the working writers and editors, presenting to them a winning ticket on the Kentucky Derby each year (after the race was run), as well as distributing some other gratuities, such as some welcome Christmas cash.

Alessio was also active on the American side of the border. He and his brothers acquired and later sold the Hotel Del Coronado and the Kona Kai Club on Shelter Island. He built the Fifth Avenue Financial Center (Fifth at Laurel, with Mr. A’s restaurant on the top floor) and was closely associated with C. Arnholt Smith in the construction of the Westgate Hotel. He built a new Juarez racetrack across from El Paso and acquired the controlling interest in Ruidoso Downs in New Mexico and the Yuma Greyhound Track in Arizona. His charitable activities included the construction of ten schools in the Tijuana area, and an annual Christmas party for Tijuana’s poor, where he and his brothers would distribute food and gifts and which reportedly cost him about $50,000 every year.

In November of 1960, John’s forty-one-year-old brother Tony, the track pricemaker, was kidnapped by a gang, at least one of whom had previously charged that the Caliente racetrack had refused to cash a legitimate winning 5-10 ticket worth $87,000. Caliente based their refusal to pay on the claim that the ticket had been altered. Tony was held for $200,000 ransom (initially $600,000 but John had bargained down the price) and shortly after John had delivered the money to a parking lot in Hollywood, the kidnappers were arrested by FBI agents. Ovid Demaris, author of Poso del Mundo, which is in part a slashing attack on the Alessios, wrote that the kidnappers claimed that Tony — estranged from John at the time because of heavy Las Vegas gambling losses — was in on the whole affair, and San Diego historian Roberta Ridgely expressed amusement that the Copley Press “played it [the kidnapping] straight.’’ Nonetheless, three people were convicted and sentenced to varying terms, and the history of the case became an FBI classic, on exhibit for visitors to the FBI offices in Washington, D.C.

The kidnapping prompted the Arguello heirs once again to squeeze into the act. They filed a series of liens to tie up the ransom money that had been recovered from the kidnapping defendants, but by that time the cash had already been returned to John Alessio.

The Arguellos, in character, did not give up. Some of them sold their rights to the claim to a Mexico City corporation called l.C./S.A., the director of which was Eduardo Hurtado, an important Federal District politician. This corporation, in 1974, finally settled the decades-old suit when Baja California Governor Milton Castellanos authorized payment of 148 million pesos for all the open land on the claim, which then became state-owned. In addition, individual owners of developed properties (including the racetrack) that were situated on the disputed land were also required to pay the corporation. Case (groan) closed!

The Alessios began to experience some misfortunes and reverses in the late 1960s. In September of 1965, John Alessio, leading a group of businessmen known as the Del Mar Associates, attempted to acquire the lease to operate the Del Mar racetrack. There were a few other groups also interested in the lease, and the proceedings dragged out over several years. Eventually, the 22nd Agricultural District of San Diego County awarded the Alessio group the lease, but the opposing associations fought back, in the process heaping barbed aspersions on Alessio’s background and integrity. They succeeded in reversing the lease grant (having appealed to the state level) and the whole matter simmered along again for years, occasionally coming to the attention of the California State Assembly and Governor Ronald Reagan.

The late Harold Keen, considered at the time to be one of San Diego’s most respected newsmen, told writer Ovid Demaris, “Alessio has been one of my most devoted enemies. That’s because I’m one of the few who won’t fall on his knees and praise Allah whenever he appears on the scene. When he tried to walk away in a very blatant manner with this Del Mar lease, even though his bid was only the second highest, we blasted the whole transaction pretty hard on television. The newspapers just went along because Alessio and Jim Copley have been somewhat associated through the years, and, of course, [C. Arnholt] Smith and Copley are very close.” In 1973 the lease was awarded to a rival group, the Del Mar Thoroughbred Club.

Then in 1967 Russell Alessio, who had been in charge of Caliente’s Foreign Book, was arrested in El Cajon for bookmaking, and later pleaded nolo contendere — in order “to spare embarrassment” to his family — to the charges, which alleged that he aided a “racketeering enterprise with the intent of distributing proceeds from gambling.” He was Fined $10,000 and given a three-year jail term, but the jail time was suspended.

The Alessio family ship now steamed directly into a hurricane. In 1970 John Alessio and brother Angelo were indicted by the federal government on charges of income tax evasion. On March 10, 1971, while in the middle of his trial, John abruptly changed his plea from innocent to guilty after the government produced a surprise witness, Robin Mansfield, who had been controller for the track and who testified that Alessio had “skimmed” money in large amounts from both the Foreign Book and the 5-10 pool. One month later John began serving a three-year sentence at Terminal Island in San Pedro; brother Angelo was convicted on the same charges and received one year. The brothers were soon transferred to the medium-security facility at Lompoc. In June the Friends of John S. Alessio Committee held a dinner in Tijuana attended by several hundred people, its purpose being, in the words of Benny Garcia, the event’s organizer and also treasurer of Caliente, to let “Johnny know his many friends in Tijuana have not forgotten him or his tremendous contribution to the economic progress and general welfare of our city.”

By this time, John Alessio was surely in need of all the friends he could get. Enemies of all sorts had surfaced everywhere: the government and his opponents in the Del Mar lease fight on one hand, and writers and journalists with venomous pens on the other. The highly critical Demaris book, Poso del Mundo, had been published in 1970, and Harold Keen locally had stirred up problems with his attention to the Del Mar racetrack affair. And even an ‘‘underground paper,” the San Diego Street Journal, devoted an entire issue to Caliente and Alessio, a free-swinging attack on the whole operation.

In spite of glowing testimonials from his friends in Tijuana, John Alessio did not seem to be a model prisoner at Lompoc. In December of 1973, a federal grand jury began to investigate charges that some of the Alessios had bribed certain prison officials and guards in order to obtain preferential treatment. John was alleged to have been granted unauthorized leaves and allowed to receive unauthorized visitors. One prison official had spent four days vacationing at Lake Tahoe, courtesy of Tony Alessio. John’s son Dominic — known as Bud — was convicted of "giving gratuities" to obtain preferential treatment for his father, a less serious charge than bribery. On April 9, 1974, John and Angelo were convicted of the same charge and fined $5000 and $2500 respectively. John was transferred back to Terminal Island to finish his sentence.

With the Alessio family’s declination came that of Agua Caliente racetrack itself. In the early-morning hours of August 5, 1971, a towering fire reduced the track to ashes and rubble. Rumors began to circulate in Tijuana that the track had been deliberately torched in order to destroy important records on the grounds. But rumors are endemic in Mexico, and no proof of arson was ever presented. As widespread as the rumor of arson was the acknowledgement among those familiar with Agua Caliente’s turbulent history that yet another era had come to an end.

This is the first of a two-part article. Next week: powerful Mexicans and American professionals - 1972 to 1983.

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Edward Spector. Banks was suspicious. He had noted Spector’s New Jersey driver’s license and Mexican plates on the Monte Carlo, and he thought he detected signs of nervousness in his behavior. - Image by Patrick Downs/L.A. Times
Edward Spector. Banks was suspicious. He had noted Spector’s New Jersey driver’s license and Mexican plates on the Monte Carlo, and he thought he detected signs of nervousness in his behavior.

The latest chapter in the. strange and turbulent history of the Agua Caliente racetrack in Tijuana began at about 10:30 a.m. last September 13, a Monday. Forty-six-year-old Edward M. Spector pulled into the primary inspection line at the Tijuana border crossing; he was heading into San Diego from Mexico. Immigration inspector Robert McGowin leaned down to the window of Spector’s 1981 Chevrolet Monte Carlo, ascertained that Spector was an American citizen, and asked him if he was bringing anything in from Mexico. According to notes McGowin made at the time, Spector replied, “All I want to declare is money — $20,000.”

“Is that all you have today?” McGowin asked.

“Yes,” Spector answered.

Spector then drove over to the secondary inspection area and filled out the necessary currency-reporting form for $20,000. As he was returning to his car, he was stopped by customs inspector Ernest Banks, who asked him if he was sure he had nothing else to declare. Banks recalls that Spector answered, “No.” But Banks was suspicious. He had noted Spector’s New Jersey driver’s license and Mexican plates on the Monte Carlo, and he thought he detected signs of nervousness in Spector’s behavior. So Banks decided to search the automobile. He opened the trunk of the car, which was registered to the Caliente racetrack, and inside he found two briefcases.

Unlike American tracks, the racing here is year-round (every Saturday and Sunday).

The briefcases were opened and revealed to contain $230,000, all of it in twenty-dollar bills.

Immediately, special agent Dominick Aragona placed Spector under arrest for making fraudulent statements and advised him of his right to remain silent. Spector stated that he was a consultant for the Caliente racetrack and that the money was the property of the track. He refused to say anything more without the advice of his attorney. Officials then transported Spector downtown to the Metropolitan Correctional Center, where he was kept overnight. The next day his wife posted bail for him — $20,000 — and Spector was released.

A San Diego spokesman for the racetrack later said that the arrest was a “misunderstanding,” that Spector had simply brought the money over the border in order to make change for the convenience of the track’s patrons. (The previous month the Mexican government had devalued the peso, lowering its value to 69.5 pesos to the U.S. dollar, and subsequent official decrees prohibited such American currency exchanges at Mexican banks.) Caliente’s San Diego spokesman reiterated that the arrest was a mistake and that Spector had been released from jail the next day. A simple misunderstanding.

Caliente can stable a horse there for about twenty dollars per day, including trainers’ fees.

This official explanation, however, has left a number of questions unanswered. Why, for example, was the money Spector carried only in the form of twenty-dollar bills? A racetrack will, of course, receive a lot of twenties, but common sense would indicate that fifties and hundred-dollar bills — which tracks also receive in abundance — would be more difficult to change for patrons. Why weren’t there any larger bills among those in Spector’s briefcases? Also, since there is no law against bringing money into the United States (though it is illegal not to declare amounts above $5000), why didn’t Spector simply declare the full amount and state his purpose? True, the Mexican government had recently enacted another decree forbidding anyone from leaving that country with more than the equivalent of 5000 pesos, but U.S. officials are not in the habit of reporting such currency violations to foreign governments. So Spector need not have feared being turned over to Mexican authorities once he was on American soil.

And while Mexican law at that time prohibited the average person from dealing in American dollars at Mexican banks, the Mexican government had already granted Caliente racetrack special dispensations during those chaotic months of financial crisis. After all, the track was Baja’s largest employer and it relied on American dollars. There is no reason to believe that the government wouldn’t have accommodated the track's need to make change for American dollars at local Tijuana banks: turn in a fifty and get back five ten-dollar bills.

Few U.S. bookmakers will accept a bet on any horse running at Caliente.

Had Spector or some other official from Caliente wanted to change American dollars for Mexican pesos, however, the exchange rate at Tijuana banks would have been the official 69.5 pesos to the dollar. But just across the border at San Ysidro’s “black market” exchange houses, the rate at that time was about ninety pesos to the dollar. That fact led officials of the labor union representing Caliente employees to speculate that Spector was not crossing over to change dollars for dollars. They believe he was going to change dollars for pesos — at 90-to-l instead of 69.5-to-l — then return to the track to pay employees’ salaries with the cash, thus netting the track’s owners a substantial and easy profit.

These questions, and others, might have been answered at Spector’s trial in federal court, had there been a trial. The United States Attorney’s office, however, decided not to bring Spector to trial. Instead, U.S. officials struck a deal with Spector: they would delay prosecuting him for eighteen months, and if during that time Spector held up his end of the deal, he would then be free to go — no prosecution, no crime, no threat of jail or fine. For his part, Spector agreed to cooperate fully with the customs service or a federal grand jury in disclosing the circumstances surrounding the transportation of the track’s money.

  1. General Esteban Cantu, 1922 (San Diego Historical Society}
  2. Baron Long, 1929
  3. Frank "Booze" Beyer, 1925 (San Diego Historical Society)
  4. Ague Caliente, 1927 (San Diego Historical Society)
  5. C. Arnholt Smith, 1933 (San Diego Historical Society)
  6. Ague Caliente Hotel, 1928 (San Diego Historical Society)
  7. Wirt Bowman, c. 1928 (San Diego Historical Society)
  8. Agua Caliente Casino. 1928 (San Diego Historical Society)
  9. Armando Verdugo. c. 1980
  10. Bruno Paglaia. e. 1940

On February 1 of this year, federal officials in San Diego struck another deal, this one with the Caliente racetrack, known formally as Hipodromo de Agua Caliente. In exchange for no one laying blame for anything or admitting any sort of liability, the United States returned to Caliente the entire $250,000 in cash and the Monte Carlo automobile in which Spector was arrested. Caliente, in turn, handed over to the U.S. a cashier’s check for $45,000. Signing for Agua Caliente racetrack was managing director Raul Baz; signing for the United States was Assistant U.S. Attorney Michael Waltz.

The U.S. Attorney’s office has been unwilling to discuss this unusual affair except to confirm details that are already a matter of public record. Raul Baz and Edward Spector both have declined repeated requests for interviews, so we may never know what really happened. Ah, Caliente. Surely this is the stuff of which legends are made.

The track is located off Agua Caliente Boulevard, just beyond the Tijuana Country Club east of downtown. In appearance, it looks like no other racetrack I have ever seen, and probably for the reason that it was designed by architects who had never before built a track, who specialized in the construction of soccer stadiums and bullfight rings. The architecture has been described as ‘ ‘Spanish-Moorish” or ‘‘Mexican colonial,” but the local Tribune was probably more accurate in labeling it a ‘‘weirdly futuristic Moorish mausoleum.” Once inside, however, things do improve, as the vista of the entire racing oval, framed by a background of green and brown hills — while hardly rivaling the beauty of the Santa Anita track in Arcadia, set before the surging San Gabriel mountains — is at least as agreeable as most American tracks, and quite a bit better than some.

  1. James Coffroth. 1925 (San Diego Historical Society)
  2. President Plutarco Flias Calles. 1941 (San Diego Historical Society)
  3. Jack Dempsey (center) and friends at Caliente, 1923 (San Diego Historical Society)
  4. Governor Abelardo Rodriguez. 1925 (San Diego Historical Society)
  5. Flood damage. February /. 1916 (San Diego Historical Society)
  6. James Crofton. 1926 (San Diego Historical Society)
  7. Eddie Neais. c. 1943
  8. Bill Kyne. 1926 (San Diego Historical Society)
  9. Charles "Rainmaker" Hatfield. 1916 (San Diego Historical Society)
  10. Adolph Spreckets. 1910 (San Diego Historical Society)
  11. Phar lap. Caliente Handicap winner. March 20, 1932

I’ve seen a lot of tracks, having fought the battle of the mutuels and, as they say, assisted in improving the breed for more than a few years, from the great betting factories of Belmont and Aqueduct in New York to the small and friendly county-fair tracks in northern California, where both the horses and the bettors are put through their paces while enduring the baking heat of summertime in the San Joaquin Valley. On several occasions over the years, I’ve even published my views and opinions on horses and handicapping for racing and trade journals. All of which is intended to preface with some experience my opinion that Caliente is not a bad track. I enjoy the place.

Caliente encompasses many of the advantages of the county-fair tracks, and adds a few of its own. Unlike American tracks, the racing here is year-round (every Saturday and Sunday) and the weather is usually salubrious. There’s lots of space at Caliente — plenty of free seating, and relatively inexpensive reserved seating. There’s none of the frantic and often rude pushing and shoving one encounters at the overcrowded meets at Hollywood Park, Santa Anita, and Del Mar. A Caliente bettor can actually get a free seat right on the finish line, if he doesn’t mind sitting in the sun for part of the day.

  1. John S. Alessio, 1963 (Photo. Roy Robinson)
  2. Rita Hayworth, 1956
  3. Russell Alessio, 1950
  4. Agua Caliente (Photo: Ted Lau)
  5. Eddie Arcaro, 1950
  6. Agua Caliente (Photo: Jack Yon)
  7. Desi Amaz, 1951 (Photo: Bill Scherlis)
  8. Joann “Miss San Diego ” Durant at Caliente, 1950

The cost of food and drink is reasonable, again compared to the overpriced concessions at the Southern California tracks. Nor do the usually cordial people at Caliente who serve up the beer and hot dogs set out the presumptuous, vaguely intimidating, and thoroughly offensive ‘‘tipping cups” that decorate the counters at the California racing tracks.

The horses at Caliente will run eleven, sometimes twelve races a day on the weekend. There are about 1200 horses stabled at the track at any one time, owned by both Mexicans and Americans, and the people who train them likewise come from both countries. For example, Wayne Spurling, who runs a sizable breeding farm in Imperial Beach but lives in Tijuana, more often than not tops the annual trainers’ lists at Caliente.

Economic realities prevail, of course, and thus the horses that compete at Caliente are of considerably lesser quality than those racing at the big California tracks; this is because the purses that Caliente offers to the owners of the winning horses are not as lucrative (although they were hiked a substantial forty percent in February in an effort to attract better stock). A thoroughbred that shows a touch of quality at Caliente is usually shipped north to try its luck for the bigger purses. However, Caliente’s attraction to owners is that they can stable a horse there for about twenty dollars per day, including trainers’ fees, compared to forty-five or fifty dollars at the Los Angeles tracks.

The wagers on horse racing at Caliente are made through clerk-operated parimutuel machines, with the odds determined by the amount bet on each horse. The total amount bet on each race, and on the entire program, is called the “handle.” From the handle the track extracts a percentage (twenty-six percent, known as “the take”) to cover purses, profits, and taxes. Bettors, in other words, don’t bet against the track; they bet against each other, with the track — in effect — charging a fee for holding the stakes and staging the show. This is common to all racetracks.

The greyhounds run at Caliente six nights a week, along with the recently added matinees on Wednesdays and Fridays. About 800 to 900 dogs are kenneled there at any given time. The dog purses are a flat three percent of the total “handle” for each particular race. According to Paul Hartwell, who has been director of greyhound racing at Caliente for more than twenty years,-most of the money that comes into the greyhounds is bet by Mexican citizens (the track will accept pesos as well as dollars). The situation is reversed at the thoroughbreds, however, with the great majority of the money wagered coming from Americans.

A third form of Caliente wagering takes place at the Foreign Book. Here the players can make a bet on races taking place at any of five or six American tracks, from those operating in New York or Florida or Maryland, to whatever California tracks happen to be running. Winning tickets are cashed at the same price paid at the individual track, with certain limitations, and with the Mexican government grabbing a one-percent tax on all winning bets (a year ago it was an exorbitant five percent). Caliente currently operates Foreign Books both at the track and in downtown Tijuana near Fourth and Revolucion, as well as in Mexicali, Tecate, and Ensenada.

These Foreign Books are Caliente’s most profitable enterprise. According to track insiders, the five books combined bring in an estimated $600,000 per week, about nineteen or twenty percent of that being profit. The expenses of running a book are minimal, as there are no purses to pay out and no track to maintain. The greyhounds also produce a nice profit, as purses and operating expenses are considerably less than they are for horses. Caliente’s live horse racing is, in fact, currently losing money, and is — essentially — being carried by the Foreign Book and the greyhounds.

Hugh Mellon is Caliente’s corporate marketing director. He is familiar with all these forms of wagering, and offers his personal assessment of the different kinds of patrons who visit Caliente: “The smartest handicappers [bettors who wade through the past-performance hieroglyphics in the Daily Racing Form in the attempt to determine the probably winner] stick to the American tracks, the Foreign Book; next, those who play the live horse racing at the track; at the bottom, in my opinion, are the dog players. It’s almost impossible to handicap a dog race. ’’ Mellon laughs. His background is strictly with horse racing. Some of my dog-playing friends, though, would dispute Mellon’s claim that they’re on the bottom. “Never bet anything that talks, ’’ the dog players sagely counsel, and they usually turn up their collective noses at jai alai wagering and the jockey-burdened horses as well. (The Jai Alai Fronton in downtown Tijuana has no connection to Caliente.)

The Foreign Book players are certainly a varied lot, but senior citizens are somewhat overrepresented. For the retired person who is a regular at the Book, trying to select a winning horse beats the hell out of playing bingo as a hobby. They obviously enjoy the creative challenge of handicapping, of solving the puzzle each race presents, and of occasionally enjoying the rewards of being right.

How does Caliente treat its Foreign Book patrons? In my opinion, not very well. A Los Angeles Times reporter felt otherwise, however, as he stated in a story published last August. “There are more amenities at this facility than you would find in any of the hundreds of state-run Off-Track-Betting parlors in New York. The OTB [operators] don’t provide a snack bar, they don’t have chairs, they don’t have an easily viewed master-results board, and they don’t post past-performance pages from the Daily Racing Form, as the Foreign Book does.”

It is difficult to understand why a Los Angeles writer would seek a comparison so far afield as New York, when large numbers of Angelenos and San Diegans are quite familiar with gambling much closer to home — in Las Vegas. There are numerous privately owned books throughout that town, and a number of Strip hotels also have separate sections for horse bettors. Consider the one at the Stardust Hotel. Each player at the Stardust gets a separate lighted desk, in contrast to the somewhat uncomfortable plastic chairs at Caliente. At the Stardust there is not only an easy-to-read master board but a tape-delayed actual call of the race from California tracks, lacking at Caliente. The Stardust will usually give the player a Racing Form (as will most of the books in Vegas) and not, as Caliente does, tack one or two copies of the Form to the wall, where players who choose not to purchase their own (for $1.75) must stand three deep in order to get a peek at the past performances. Players in Las Vegas are often given free drinks and sometimes a meal on the house. This practice is completely unknown at Caliente. The restrooms in Vegas are usually immaculate; at Caliente, particularly at the Foreign Books downtown and at the track, they can charitably be described as unpleasant. Parking is normally free in Vegas; you must pay at the downtown book and also at the track book on weekends. And, of course, Vegas does not tax winning tickets. Caliente seems to operate on the-only-game-in-town philosophy: there is no legal competition in the area. Hard-core bettors will swim rivers to get there, but it’s difficult to believe that Caliente’s Foreign Book is going to get (or keep) the casual tourist out for a bit of gambling recreation.

Another of Caliente’s unfortunate problems is the track’s share of all bets made, the mutuel take of twenty-six percent, which is outrageous when compared to the less than sixteen percent in California. In Mexico, each time you wager a dollar on live racing, twenty-six cents is taken off the top. While it’s true that the average player does not understand such complexities, he does understand that his money just does not seem to last as long at Caliente.

Hugh Mellon, an experienced track executive, candidly acknowledges the track’s deficiencies: “Numerous studies have shown, time and again, that two things stand out as having the greatest importance in the successful operation of a racetrack. One is the physical facility, and yes, including the restrooms. Frankly, I myself would never use those at the track. The whole place, the Books particularly, and that downtown facility above all, are terrible. We are going to make improvements. Also of great importance is the mutuel take — the higher it goes, the lower your ‘handle’ goes. Studies show that to be inevitable. All state governments believe that racetracks are the geese that will never stop laying those golden eggs, but that’s wrong.

It’s a matter of educating the government,” Mellon says that he’d like to see the mutuel take lowered, and back in February he told me that the track would soon be spruced up, but alas, neither has yet come to pass.

What has come to pass, though, with the arrival of Edward Spector and Hugh Mellon and many others working for the current owner of the track, is another piping-hot serving of that good old Caliente controversy, continuing a great tradition which started a long, long time ago. Back in 1909, all horse racing in California fell victim to an antigambling reform movement, and those in the state connected with the sport — inspired by the well-known success of the Juarez track across the border from El Paso — decided to build a track in Tijuana and exploit its proximity to Southern California population centers. A group of men headed by San Francisco boxing promoter James (Sunny Jim) Coffroth undertook the job of construction and management of a new racetrack in Tijuana. One of the principals was William Kyne, who twenty-five years later would build the Golden Gate Fields facility near San Francisco. Another participant was Frank (Booze) Beyer, owner of the nightclub and gambling hall in Mexicali known as the Owl Cafe. (Beyer later gained a sliver of immortality by having a South San Diego boulevard named after him — probably owing to his donation of a fire department and a library to the village of San Ysidro.) Beyer joined with bar and casino owners Marvin Allen and Carl Withington to form the ABW Corporation, which underwrote the book betting at the new track. Baron Long, executive director of the LJ.S. Grant Hotel and the owner of the Sunset Inn casino in Tijuana, also had a piece of the action. These entrepreneurs, known as the Border Barons, were easily the most important businessmen in Baja California at the time, and for several years to come. Much of the detail surrounding those early days in the formation and operation of the track has passed on with the principal actors. But among those who have attempted to chronicle the initial years of Tijuana racing is San Diego author and historian Roberta Ridgely, who knows more about the first two decades at the track than anyone else alive. Her work was published in San Diego Magazine between 1957 and 1971. Even Ridgely’s excellent research, however, would have benefited from more first-hand, candid reminiscences. But nearly all the Border Barons, including Sunny Jim Coffroth, had died by the time Ridgely began her work.

Coffroth had little interest in horse racing as a sport, but he had a genius for promotion, plus numerous contacts among horsemen, journalists, businessmen. He obtained a major portion of the financing to build the Tijuana track from Adolph Spreckels, whose family — he was the brother of John D. Spreckels — for decades after made strong denials of the old man’s involvement. Spreckels was a horseracing buff and the owner of the Napa Stock Farm. He felt that Tijuana racing might help to return the sport to California; an added incentive may have been the fact that he owned the railroad spur to the border and needed an attraction like the racetrack to encourage people to make the ride to what was then a “desolate, scattering, wind-swept village,” as a Los Angeles Times writer described it at the time.

At the time the track was being built, General Esteban Cantu was in effective control of Baja California. He had been sent to the area in 1911 by the Mexican government to drive out the Americans who had come to Mexico to assist the revolution. Although the new revolutionary government in Mexico City vetoed the racetrack idea.

Cantu, strongly of independent mind, was all for it, so construction proceeded on schedule. On January 1, 1916, the track, with a wooden grandstand, sparkling white fence, and 114-foot-long liquor bar, opened for business less than a quarter mile from the border crossing. (The site of the track is now partially covered by the freeways and by the Tia Juana River canal.) Coffroth’s friends in the press helped publicize the event and 10,000 people showed up on opening day. Many of the attendants at the track were dressed in the uniforms of the 1915 San Diego Exposition, which had been sold to them by the ill-paid Expo guards. General Cantu was there with his mounted cavalry. Jim Jeffries, Frank Fay, and Mack Sennett were a few of the notables of the era in attendance, and boxing great Jack Dempsey served as honorary starter. Coffroth always made sure the media was informed whenever film stars and sports celebrities journeyed to his track, and hundreds of them did so in the ensuing years.

On the day the track opened, it started raining again after a long drought. At first this seemed an auspicious omen, but the rain didn’t stop. It turned out to be one of the worst floods in Southern California history, which some believed had been brought on by a self-proclaimed magician known as Hatfield the Rainmaker, who had been hired by the City of San Diego to end the drought. The waters rose and the Tia Juana River flooded into the newly opened racetrack. Coffroth was undeterred; he obtained from Adolph Spreckels more money to rebuild the track. “Take it from me,” Coffroth proclaimed to the press, “Tijuana, with San Diego so close, is the ideal place for the Sport of Kings.”

The rebuilt track (at the same location in the river bed) was officially called the Sunset Racetrack but usually known simply as “the Tijuana track.” Quickly it prospered, and after a government-imposed hiatus during World War I, business picked up again — better than ever. Thousands of thirsty Californians took to fleeing for a few hours the Great Prohibition Experiment which struck America in January of 1920. It was actually during Prohibition (1920-33) that Tijuana gained its reputation — which still lingers today — as a town that catered to all the vices legally beyond the pale in the U.S., but which the gringos were eager to explore. The track benefited hugely by this flow of visitors, as did the Tijuana Fair, Sunset Inn, Tivoli, and the Foreign Club — gaming casinos all.

Criticism of the wild goings-on across the border came early. For example, the Women’s Christian Temperance Union, meeting at a Methodist Church in downtown San Diego, issued the following sober proclamation: “The racetrack at Tijuana, Mexico, with its well-known gambling evils and attendant debauchery, is a terrible and increasing menace to the homes of this and other states, degrading young men and ruining young girls.”

In 1926 Will Rogers visited Tijuana and reported back to the nation. “Well, they are having a big stir all over the U.S. about Tijuana and Mexicali,” he wrote. “It seems they sell drinks down there right over the bar . . . and they gamble there right before your own eyes. And they claim it is ruining the youth and manhood of this country. That it is a disgrace to have these things done right there in Mexico, where the Americans can go right over and see all this. Americans don’t want to drink and gamble. They just go over there to see the mountains, and these scheming Mexicans grab ’em and make ’em drink and make ’em bet and make ’em watch the horse races for money. It seems that Americans don’t know these places are over there at all, and when they get there these Mexicans spring on ’em and they have to drink or the Mexicans will kill ’em. . . .

“You put a church in every building where there is a gambling house and saloon now in Tijuana, and I lay you a bet there wouldn’t be five people across that line a year. ...”

Ring Lardner, another humorist of the time, also made a visit and wrote, “When you get ready to go home in the evening, that is, to San Diego or Coronado, two or three officials of one kind or another stops your car at the border and glances in the tonneau with the same amount of attention as is lavished on a snowflake in Minnesota, and then motions you to go ahead. What they are looking for I could not find out, but with the time and pains they take for the search, it seemed to me like a person could smuggle in a herd of elephants in the back seat of one Ford, with every elephant playing the ‘Marseillaise’ on a calliope.” When the track and the border reopened after being closed during WWI, business was so profitable that some of the early investors, headed by Bill Kyne, mounted a legal drive to deprive Coffroth of control. Kyne’s group sued Coffroth for half a million pesos, and when things began to go sour in court for Coffroth, he would sometimes sleep in the clubhouse, fearing that if he left he would be barred from re-entering his own track. Matters grew even more tense when one of his faithful aides was murdered in the track infield by assailants unknown. Coffroth finally managed to bring in a Mexican federal magistrate from La Paz who decided in his favor.

The W of the ABW Corporation was Carl Withington, who had developed key political connections in Mexico City. When he died in the mid-1920s, his place was taken by Wirt G. Bowman, who was also locked into the political power in the Mexican capital. During the Mexican revolution. Bowman had built up his political influence by running guns to the revolutionary hero Alvaro Obregon and to his generals Plutarco Elias Calles and Abelardo Rodriguez, all later to rise to the presidency of the Mexican Republic.

According to Luis Tames, president of the Tijuana Historical Society, Rodriguez, then governor of Baja California and acting in conjunction with Mexican President Plutarco Elias Calles, approached his friend Wirt Bowman in 1926 with the proposition that he — Bowman — build in Tijuana a large and magnificent casino on land that Rodriguez held title to. Bowman accepted the invitation, and together with his racetrack partner Baron Long, set about constructing a palatial complex of buildings.

The land that Rodriguez owned — or thought he owned — near downtown Tijuana had had a colorful history, and proved to be turbulently controversial for years to come. It was part of thousands of acres granted to Don Santiago Arguello by the Spanish crown in 1829. Arguello was governor of California before this area became part of the United States, and much of his property covered an area that includes a goodly portion of contemporary San Diego County. (The Arguello family name, incidentally, appears in Richard Henry Dana’s classic Two Years Before the Mast.)

In 1926 one of the Arguello family heirs, Alejandro Arguello, sold a sizable chunk of the land in Tijuana to Rodriguez, for the equivalent of $35,000. Immediately after the sale, Rodriguez made his casino proposition to Wirt Bowman. But three years later the other Arguello family heirs, contending that they had not been consulted regarding the sale, took the matter to court, and there it remained for more than four decades, involving in the process three major Mexican Supreme Court decisions, and making a number of Mexican lawyers wealthy along the way. The legal fight was led by a Mexican-American woman named Susana Lucero Viuda de Regnier, a cousin of the Arguellos who had purchased a major share to the land claim. Senora Lucero declared, “It has taken us years to prepare for this and we are prepared to spend several more years before we finish. It is a hard fight, and I am not deluding myself or anyone else.” She later began to refer to herself publicly as “Tijuana Susie,’’ as she felt that she was Tijuana’s biggest landowner.

Despite the legal entanglements, in June of 1928, Bowman and Long opened their opulent Agua Caliente Hotel and Casino, a pleasure dome of baroque elegance designed by a young San Diego architect named Wayne McAllister. Vogue magazine described it as “a dazzling, dreamlike city in miniature.’’ Roberta Ridgely, who visited the place as a child, said that it was the closest thing to Shangri-la she had ever seen. Next to the casino, and operating as part of the same development, was a greyhound racetrack, which had been created a year earlier by the Tijuana Kennel Club. Later, a modem golf course was built across the street. (The casino, of course, is no more. A school now occupies the original site, a block off Agua Caliente Boulevard, just to the rear of the El Sombrero Motel. Except for the Arabian-style minaret left standing lonely against the sky, hardly anything now remains of the old casino.)

Bowman, Long, and their partners also decided to abandon the old riverbed racetrack and open a new and classier track, which they did the following year, on land where Agua Caliente is now located. Bowman’s political connections in Mexico undoubtedly aided in the acquisition of all the proper licenses. Coffroth was supposed to run the new track but was soon effectively cut out (“They kissed me off,’’ he said later), and James Crofton became Caliente’s general director. Crofton boasted a motley career: shipyard mechanic, public relations work for the San Diego Expo, Ringling Brothers circus clown, and publicist for the Tijuana bullring, as well as for the Coffroth track — his duties for the track included riding a horse around San Diego while dressed as a jockey.

Coffroth left racing altogether and retired to his home in Point Loma, where he cultivated the arts and prize-winning dahlias for the remainder of his life. One of his local legacies — in addition to the racetrack — is the Star of India. When a committee was formed to raise the $9000 required to bring the old sailing ship to San Diego, its representatives went first to Sunny Jim, who wrote out a check for the full amount. When Coffroth died in 1943, the San Diego Union wrote that “the city not only lost a man — it lost an institution.”

The onset of the Depression (in 1929) and the end of Prohibition (in 1933) at first failed to diminish the volume of visitors to the twin gambling emporiums (there was, Roberta Ridgely says, actually a secret tunnel connecting the track with the casino — they were about half a mile apart). Among the noteworthy visitors then were Baron Rothschild, Jack Dempsey, Babe Ruth, Clark Gable, Mary Pickford, Douglas Fairbanks Sr., Wallace Beery, Charlie Chaplin, Jack Johnson, A1 Jolson, Bing Crosby, the Marx Brothers, Stan Laurel and Oliver Hardy (Hardy was reputed to be a heavy horse bettor), and many more. The track itself had weekends when it drew close to 100,000 people.

However, the legalization of horse racing in California in 1934 (and the opening of the big Santa Anita track in Los Angeles) did serve to reduce substantially the number of patrons — and the quality of competing horses as well, since many owners decided to take their stock up north to compete for the more lucrative purses. Many also lost confidence in the track when Baron Long created a scandal with the “Linden Tree affair” in January of 1932. The thoroughbred Linden Tree looked like a cinch to win a maiden race; if the horse won, however, bettors wouldn’t claim much because Linden Tree was so heavily favored. But after Long had manipulated the wagering odds by placing large bets at the track against Linden Tree (while secretly placing much larger bets in favor of Linden Tree at American bookmaking establishments), the horse, which did win, paid a whopping $21.40. Linden Tree probably would have paid no more than four dollars had Long’s wagering not changed the odds. The incident caused an uproar in American betting circles, and to this day few U.S. bookmakers will accept a bet on any horse running at Caliente. Long allegedly gave most of the money he won in this coup to a Methodist charity, including $8500 to a mission on Fifth and Island in downtown San Diego.

In an effort to regain the confidence of bettors, the Caliente stewards barred Baron Long from his own track for a while, and when the ban was finally lifted, he too had become disenchanted with horse racing and had donated his renowned breeding ranch to an Indian tribe. Then James Crofton soon left Tijuana, to train horses in New England. Also around this time 20th Century Fox president Joseph Schenck — a regular at the track and casino for years — bought a large share of stock from Long, which effectively made him a partner.

In 1934 Lazaro Cardenas was elected President of Mexico. Plutarco Elias Calles, prevented by law from succeeding himself as president, had nonetheless kept control of the government by hand-picking Cardenas as the candidate of the dominant political party, thus assuring Cardenas’ election. (Calles also selected members of the new president’s cabinet of ministers.) However, Cardenas soon broke with Calles, installed his own cabinet, and began to move in directions Calles denounced as “radical.” One action Cardenas took was to close up the casinos and brothels throughout Mexico, in many of which prominent Callistas had financial interests; Calles himself owned part of the Agua Caliente casino. Supporters of Calles, members of a quasi-fascist street movement known as the “Gold Shirts,” were still active in Mexico, so to forestall a possible coup attempt, Cardenas exiled Calles to the United States. Calles’ friend Wirt Bowman left the racetrack and retired to Arizona, from where he became a power in Democratic national politics. A strange quiet settled over the casino and the track. Then both were shut down in July of 1935. A great era had ended.

In the relatively short history of horse racing in Tijuana up to 1935, the Border Barons who organized the operations claimed an enviable number of precedents. They were the first to offer a $100,000 purse (the Coffroth Handicap in 1928), to have Sunday racing (in 1933), to have a photo taken at the finish line (1922), to have the running of a race announced over the public-address system (1925), to use a sprinkler car to wet down the track, and to present female jockeys (the first “Powder Puff Derby”). Judge George Schilling, a fixture at West Coast tracks for more than half a century, was responsible for several of these innovations.

Some remarkable horses also competed during those early years in Tijuana: Exterminator, Calaris, and others, including the Australian champion Phar Lap, who won the Caliente Handicap in 1932. This horse, of gigantic stature, is considered by some to be the greatest ever to run. Unfortunately, he died of colic a few weeks after his big win, thereby contributing his bit to the legend of what Roberta Ridgely has called the “jinx track.”

The Agua Caliente casino never reopened, but in 1937 the Mexican government permitted the track to resume operation, and a parade of different people took possession of the concession license in the next few years. There remains some confusion regarding exactly what happened when the racing started up in 1937. The late Diego Herroz, who until his death recently was interior secretary of the Sindicato Alba Roja, the union that represents racetrack employees, said that Mexican President Cardenas, upon reopening the track, gave the concession, or permit, outright to the Alba Roja union. Herroz recalled that leaders of the union, after considering the implications of full responsibility for the track and deciding that they lacked the proper expertise to manage the enterprise, sold the operating rights. Herroz said he could not recall and could not discover to whom the license had been sold. This account, however, is contradicted by Armando Verdugo, who at seventy-six years of age may know as much about early Caliente history as Roberta Ridgely.

Verdugo moved from Hermosillo, Mexico to San Diego when he was a child; his father was in the Mexican consular corps here. The young Verdugo attended school in San Diego, but by 1924 had begun working in Tijuana, where he became personally acquainted with virtually all the characters in the Caliente drama — Coffroth, Long, Bowman, Abelardo Rodriguez, Crofton, and many others. He worked at the Agua Caliente casino from the day it opened until the day it closed; and later, Verdugo himself became an important part of Caliente history. Today Verdugo lives in Tijuana in comfortable semiretirement; as a business venture he currently leases video-playback equipment from a storefront in downtown Tijuana.

Verdugo recalls that Baron Long and his remaining partners still controlled the government concession when the track resumed operation in 1937 and that Long appointed a man named Bruno Paglaia as general manager. Paglaia, who had worked for Long at the casino, then approached Verdugo and, according to Verdugo, said, “Listen, Armando, I know where the horse’s head is supposed to be and I think I know where the tail is, but that’s about all. Don’t leave my side until I know what I’m doing.’’ Verdugo says he counseled Paglaia for six months but by that time Baron Long had realized his mistake in appointing the inexperienced Paglaia and had begun looking around for some good excuse to replace him.

Verdugo says that he unintentionally provided Long with the excuse he needed when Paglaia asked him, Verdugo, how he might ingratiate himself with Manuel Avila Camacho, the presidential candidate sure to win and succeed Lazaro Cardenas. Paglaia accepted Verdugo’s suggestion to send Camacho a racehorse, and Verdugo took it upon himself to find a suitable horse at a price Paglaia was willing to pay. A Tijuana restaurateur named Nick Parras had a gimpy but well-bred animal called Sun Pilot, and was asking $5000 for him. “Nick,” Verdugo told the owner, “this horse only has three good legs. Here, I’ll give you $3000 cash.” Verdugo pulled a wad of twenty-dollar bills from his briefcase and closed the deal. The horse was promptly shipped off to Camacho.

Shortly thereafter, Baron Long wrote Paglaia a letter dismissing him from his duties as general manager because, the letter stated, Paglaia had compromised the integrity of Caliente by getting mixed up in Mexican politics. This, of course, was a laughable pretext, considering the history of the track and casino and the number of politicians who had been participants in both. Long then appointed Enrique Neidhart as general manager, but the track soon became entangled in problems with the Alba Roja labor union and closed its doors once again in 1939.

Baron Long, by this time having had his fill of the entire enterprise, decided to retire. According to Verdugo, Long simply gave the rights to the track to a group of associates and former employees that included general manager Neidhart. However, Neidhart and his partners (one of whom, Alfonso Garcia Gonzalez, was later to become Governor of Baja California) feared that with the onset of World War II they would not be able to make a profit running horse races. The labor problems had been resolved, but rather than risk operating at a loss, Neidhart never staged a race and instead let the track lie fallow.

With the closing in 1939, Armando Verdugo found himself unemployed. Before long, though, he was working again. Through the aid of a friendly Los Angeles police detective, Verdugo was hired as a roulette croupier in an illegal Los Angeles gambling club called the Clover Club, owned by a man named Eddie Nealis. While working at the Clover Club, Verdugo became friendly with well-known gangster Benjamin (Bugsy) Siegel, a patron of the club and a friend of Nealis. Verdugo says that Siegel was interested in the dormant racetrack in Tijuana and asked if Verdugo would help him arrange to purchase it from Neidhart.

Verdugo says he declined to assist Siegel but that Siegel proceeded on his own and sent a Boston lawyer to Tijuana to negotiate with Neidhart. “This lawyer,” Verdugo recalls, “didn’t understand Mexico or Mexican law, and wasn’t able to make any / headway. So the deal there fell through.” (Siegel went on to build the first of the flashy Las Vegas Strip hotels — the Flamingo — and in 1947 was murdered gangland-style in Los Angeles.)

Unlike Neidhart, Verdugo believed that Caliente could be opened up again and be successful — war or no war. So he began talking with Nealis about the possibility of forming a partnership to buy it from Neidhart. After determining that Neidhart and his associates were indeed interested in selling the track — and for a mere $100,000 — Nealis, Verdugo, and a few other investors put $25,000 down and started Caliente racing again in May of 1943.

The track had been open only about a year when James Crofton once again appeared on the scene. Amid great controversy, Crofton announced that he and several partners were legally in control of the track. Verdugo recalls that Crofton had developed an association with a Tijuana businessman named Augustin Silverya, who had been a dealer at the old casino. Silverya was among a group of influential men who had been representing Susana Lucero and the ubiquitous Arguello heirs; the heirs finally had won a major victory in the Mexican Supreme Court, and Silverya, Crofton, and the others in Mexico City claimed to have leased from the family the right to run the track — which they said they intended to do, regardless of Eddie Nealis and Armando Verdugo.

Verdugo says that he hustled off to consult with Baja California Governor Rodolfo Tadoada in an effort to determine if anything could be done to prevent Crofton, Silverya, and the Arguello heirs from seizing the business. “Tadoada said to me, ‘Armando, you don’t really have a case. The only thing you may be able to do is to sue for the improvements you’ve made to the property.’’ Nealis and Verdugo thereupon filed a two-million-dollar lien on the racetrack property. The Arguello heirs were unaware of this lien when five or six of them, led by Susana Lucero, met at a government office in Tijuana to complete formal transfer of the Caliente property. Nealis and Verdugo were present at that meeting and had already informed the presiding government official that they had legally placed a lien on the property. The official dramatically announced to Lucero and her relatives that while they may have “judicial” or technical rights to the track, because of the lien, the operating rights would remain with Nealis and Verdugo. The heirs had once more been frustrated in the attainment of their goal, and their disappointment and anger must have been intense. Susana “Tijuana Susie” Lucero died the next day.

The remaining heirs, of course, were not about to be dissuaded for long by Verdugo’s legal ploy; they returned to Mexico City to have the lien voided, and late in 1945 finally gained control of the racetrack. Perhaps it would be more accurate to say that the lawyers and politicians in Mexico City who had “represented” them had gained control of the track. Among those who seemed to be in true control were Augustin Silverya, Gonzalo Gonzalez, and Enrique Parra. Gonzalez and Parra, both from Mexico City, had close political ties to President Camacho. The Arguello heirs, according to Verdugo, received hardly anything, “except a free meal at the track now and then.” Silverya (who had by now broken with Crofton) claimed to have a twenty-five-percent share of the Caliente concession, and moved in as general manager. Verdugo and Nealis were out.

Silverya apparently had difficulty operating the track. According to Nelson Fisher, former racing correspondent for the San Diego Union who was working for Silverya in the track’s PR office at the time, some of the problems Silverya was having resulted from his diverting track money into an unsuccessful restaurant in downtown Tijuana, and also into the wining and dining of Hollywood starlets. Silverya needed a competent assistant if the track was to run profitably and if his associates in Mexico City were to remain content. He turned for help to the former manager of the Banco del Pacifico, where the track had been doing its banking. Silverya had admired the skill of the bank’s youthful manager, who had recently resigned from his position there following disclosure of some large and controversial loans he had approved. In a fateful decision, Silverya asked the former manager to join the Caliente organization as assistant manager. Within months, Silverya would end his career in racing and a new era would begin at the track. The young man Silverya hired and who set about changing the history of Agua Caliente was John S. Alessio.

John Alessio’s rise from poor boy to one of San Diego’s most prominent citizens is “the stuff of which movies are made,” wrote the San Diego Union in 1963. He is, the paper went on, “a business and civic leader of the first magnitude. In many parts of Mexico he is considered almost a saint.”

The poverty-stricken Alessio family arrived in San Diego from West Virginia just after World War I. John, one of seven brothers, dropped out of school after the seventh grade and wound up shining shoes in the old Crystal Palace Building downtown at the corner of Fifth Avenue and E Street. Fortunately for him, he had developed a friendship with C. Arnholt Smith, then associated with the Bank of Italy (where, incidentally, the Border Barons of old kept most of their money). When the Crystal Palace Building was scheduled for demolition in the late Twenties, Smith got Alessio a job in Tijuana’s Banco del Pacifico as a messenger boy. Armando Verdugo remembers meeting Alessio in 1929 when the young bank messenger showed up at the back door of the counting room of the Agua Caliente casino. Verdugo opened the door and Alessio said he was there because he was supposed to take the night’s receipts over to the bank. Verdugo recalls, “I said to the casino manager, ‘Hey, there’s a young kid here who says he’s from the bank,’ and the manager told me it was okay. That’s the first time I saw John Alessio.” By 1943 Alessio had risen from messenger to manager of Banco del Pacifico.

If Alessio had favorably impressed the bank’s owners, he also impressed Augustin Silverya and Silverya’s partners in Mexico City, quickly gaining their trust and confidence. Alessio’s old friend Armando Verdugo recalls what then took place. Within a year of being hired as Caliente’s assistant manager, Alessio offered to purchase Silverya’s interest in the racetrack. Silverya was eager to sell. The price for his twenty-five-per-cent share was $80,000. Verdugo says that within a few months Alessio had persuaded the remaining partners in Mexico City to sell him their shares, for an undisclosed sum. Less than a year after those purchases, Alessio struck a deal with the track’s former operator, Enrique Neidhart, who still maintained a claim to the property upon which the track was built. Neidhart, for an unknown amount of money, sold out to Alessio. who now effectively had complete control of the Caliente racetrack as well as the surrounding property. The money needed to finance these purchases came from within the Alessio family, but because John Alessio declined several requests to be interviewed for this account, the exact source of that money cannot be confirmed.

Armando Verdugo recalls that a sizable portion of the money at Alessio’s disposal had come from an extremely profitable money-exchange business Alessio had set up on this side of the border while he was still employed by Banco del Pacificio. During World War II, the U.S. government had prohibited tourists from taking into Mexico any currency other than unpopular two-dollar bills, for fear that Axis powers might somehow obtain American dollars and use them for nefarious purposes. Alessio took advantage of the situation by offering to Tijuana tourists a supply of two-dollar bills — for a ten-percent service charge. When the supply of two-dollar bills began to dwindle and as the racetrack opened up again in 1943. the rush of tourists (many of them military personnel newly moved to San Diego) demanded an alternative to hard cash. So Alessio, in conjunction with his early mentor C. Arnholt Smith, produced for tourists bank script that soon was accepted throughout Tijuana, including at Agua Caliente racetrack.

About a year after Alessio began his acquisition of the track, he and seven other former executives of Banco del Pacifico were arrested on bank fraud charges arising from the controversial loans that had led to Alessio’s resignation from the bank. The men were locked up in the Tijuana jail, where they remained for 117 days. The same men, including Alessio, also came under indictment from a California grand jury, due to a series of related loans that involved a San Francisco company and a former governor of Baja California. Eventually the former bank officials were released from the Tijuana jail without being charged and the California indictment was dropped as well.

With these problems behind him, Alessio was free to pursue his efforts to turn Caliente into a moneymaking operation. (He kept his ownership of the track a secret, however, and the general public was led to believe that he was still just the assistant manager. The track’s manager, hired by Alessio, was the well-respected racing expert Walter C. Marty.) In time, Alessio would enjoy the results of his hard work and innovative thinking as the track prospered under his reign. But before the good times rolled in, Alessio was rather rudely introduced to the Arguello clan, a group of people who could apparently give a bulldog some lessons in tenacity.

In 1949 several hundred of the dissident heirs, now banded together, had unsuccessfully sued the track for a share of the profits, claiming that their property rights had been ignored when Alessio bought out Enrique Neidhart. Then in 1954, armed with a court order from Mexico City, which they interpreted as giving them legal control of the track, they physically occupied and took possession of Caliente. Alessio later told the Saturday Evening Post, “When I came to the track at nine, they [the Arguello family members] wouldn’t let me through the gates. They claimed the place was theirs. I went to Tijuana and got a restraining order from a federal judge, barring the heirs from the property until the matter could be argued in court.’’ As a stalling tactic, Alessio couldn’t have hoped for anything better: the matter of the Arguello family claim was tied up in court for another twenty years.

In the meantime, Alessio elevated himself to the position of general manager and initiated a number of promotions and gimmicks that proved to be tremendously successful. His master stroke was the 5-10, inaugurated in 1955 and patterned after a similar wagering system used at a track in Venezuela. The 5-10 required a player to select the winners of the fifth through tenth races on the program. (Many American tracks have since copied this type of exotic wagering and refer to it as the “Pick Six.’’) The payoffs were phenomenal — $50,000, $100,000, and more — unheard of in North America at that time. The publicity engendered by the 5-10 brought national attention to Caliente, and attendance rose accordingly.

Johnny — as he was affectionately known to his patrons — exhibited his flair for promotion in many ways. He allowed the ordinary man access to the beautiful clubhouse and permitted him to dine at a private table while watching the races. (The food and drink at Caliente were both excellent and reasonably priced.) He installed the attention-getting “Future Book,’’ in which players could make bets on the Kentucky Derby months in advance. He put on a Kentucky Derby party billed as “the largest west of Louisville.’’ He distributed free passes to the track at almost every liquor store in San Diego. He put one-dollar coupons in the newspapers, which when clipped and presented at the track, were good toward a two-dollar bet. On one occasion he drew a tremendous crowd by setting up a “match race’’ between Johnny Longden, the world’s winningest jockey, and a female rider named Wantha Davis. (Longden left the track in a huff when the lady won the race.) In 1958 Alessio boasted that Caliente’s ads and promotion budget ($400,000) was the highest of any track in the world. He gave to the Saturday Evening Post his frank philosophy regarding his successful operation: “Racetracks were never built to benefit the players. At Caliente, we just try to arrange a good time for him while he’s losing.’’

Alessio had the foresight and good sense to keep the press happy. He maintained a good relationship with publisher James Copley, which was helped by his friendship and business association with C. Arnholt Smith, himself by now a financial power in the community. Nor did Alessio forget the working writers and editors, presenting to them a winning ticket on the Kentucky Derby each year (after the race was run), as well as distributing some other gratuities, such as some welcome Christmas cash.

Alessio was also active on the American side of the border. He and his brothers acquired and later sold the Hotel Del Coronado and the Kona Kai Club on Shelter Island. He built the Fifth Avenue Financial Center (Fifth at Laurel, with Mr. A’s restaurant on the top floor) and was closely associated with C. Arnholt Smith in the construction of the Westgate Hotel. He built a new Juarez racetrack across from El Paso and acquired the controlling interest in Ruidoso Downs in New Mexico and the Yuma Greyhound Track in Arizona. His charitable activities included the construction of ten schools in the Tijuana area, and an annual Christmas party for Tijuana’s poor, where he and his brothers would distribute food and gifts and which reportedly cost him about $50,000 every year.

In November of 1960, John’s forty-one-year-old brother Tony, the track pricemaker, was kidnapped by a gang, at least one of whom had previously charged that the Caliente racetrack had refused to cash a legitimate winning 5-10 ticket worth $87,000. Caliente based their refusal to pay on the claim that the ticket had been altered. Tony was held for $200,000 ransom (initially $600,000 but John had bargained down the price) and shortly after John had delivered the money to a parking lot in Hollywood, the kidnappers were arrested by FBI agents. Ovid Demaris, author of Poso del Mundo, which is in part a slashing attack on the Alessios, wrote that the kidnappers claimed that Tony — estranged from John at the time because of heavy Las Vegas gambling losses — was in on the whole affair, and San Diego historian Roberta Ridgely expressed amusement that the Copley Press “played it [the kidnapping] straight.’’ Nonetheless, three people were convicted and sentenced to varying terms, and the history of the case became an FBI classic, on exhibit for visitors to the FBI offices in Washington, D.C.

The kidnapping prompted the Arguello heirs once again to squeeze into the act. They filed a series of liens to tie up the ransom money that had been recovered from the kidnapping defendants, but by that time the cash had already been returned to John Alessio.

The Arguellos, in character, did not give up. Some of them sold their rights to the claim to a Mexico City corporation called l.C./S.A., the director of which was Eduardo Hurtado, an important Federal District politician. This corporation, in 1974, finally settled the decades-old suit when Baja California Governor Milton Castellanos authorized payment of 148 million pesos for all the open land on the claim, which then became state-owned. In addition, individual owners of developed properties (including the racetrack) that were situated on the disputed land were also required to pay the corporation. Case (groan) closed!

The Alessios began to experience some misfortunes and reverses in the late 1960s. In September of 1965, John Alessio, leading a group of businessmen known as the Del Mar Associates, attempted to acquire the lease to operate the Del Mar racetrack. There were a few other groups also interested in the lease, and the proceedings dragged out over several years. Eventually, the 22nd Agricultural District of San Diego County awarded the Alessio group the lease, but the opposing associations fought back, in the process heaping barbed aspersions on Alessio’s background and integrity. They succeeded in reversing the lease grant (having appealed to the state level) and the whole matter simmered along again for years, occasionally coming to the attention of the California State Assembly and Governor Ronald Reagan.

The late Harold Keen, considered at the time to be one of San Diego’s most respected newsmen, told writer Ovid Demaris, “Alessio has been one of my most devoted enemies. That’s because I’m one of the few who won’t fall on his knees and praise Allah whenever he appears on the scene. When he tried to walk away in a very blatant manner with this Del Mar lease, even though his bid was only the second highest, we blasted the whole transaction pretty hard on television. The newspapers just went along because Alessio and Jim Copley have been somewhat associated through the years, and, of course, [C. Arnholt] Smith and Copley are very close.” In 1973 the lease was awarded to a rival group, the Del Mar Thoroughbred Club.

Then in 1967 Russell Alessio, who had been in charge of Caliente’s Foreign Book, was arrested in El Cajon for bookmaking, and later pleaded nolo contendere — in order “to spare embarrassment” to his family — to the charges, which alleged that he aided a “racketeering enterprise with the intent of distributing proceeds from gambling.” He was Fined $10,000 and given a three-year jail term, but the jail time was suspended.

The Alessio family ship now steamed directly into a hurricane. In 1970 John Alessio and brother Angelo were indicted by the federal government on charges of income tax evasion. On March 10, 1971, while in the middle of his trial, John abruptly changed his plea from innocent to guilty after the government produced a surprise witness, Robin Mansfield, who had been controller for the track and who testified that Alessio had “skimmed” money in large amounts from both the Foreign Book and the 5-10 pool. One month later John began serving a three-year sentence at Terminal Island in San Pedro; brother Angelo was convicted on the same charges and received one year. The brothers were soon transferred to the medium-security facility at Lompoc. In June the Friends of John S. Alessio Committee held a dinner in Tijuana attended by several hundred people, its purpose being, in the words of Benny Garcia, the event’s organizer and also treasurer of Caliente, to let “Johnny know his many friends in Tijuana have not forgotten him or his tremendous contribution to the economic progress and general welfare of our city.”

By this time, John Alessio was surely in need of all the friends he could get. Enemies of all sorts had surfaced everywhere: the government and his opponents in the Del Mar lease fight on one hand, and writers and journalists with venomous pens on the other. The highly critical Demaris book, Poso del Mundo, had been published in 1970, and Harold Keen locally had stirred up problems with his attention to the Del Mar racetrack affair. And even an ‘‘underground paper,” the San Diego Street Journal, devoted an entire issue to Caliente and Alessio, a free-swinging attack on the whole operation.

In spite of glowing testimonials from his friends in Tijuana, John Alessio did not seem to be a model prisoner at Lompoc. In December of 1973, a federal grand jury began to investigate charges that some of the Alessios had bribed certain prison officials and guards in order to obtain preferential treatment. John was alleged to have been granted unauthorized leaves and allowed to receive unauthorized visitors. One prison official had spent four days vacationing at Lake Tahoe, courtesy of Tony Alessio. John’s son Dominic — known as Bud — was convicted of "giving gratuities" to obtain preferential treatment for his father, a less serious charge than bribery. On April 9, 1974, John and Angelo were convicted of the same charge and fined $5000 and $2500 respectively. John was transferred back to Terminal Island to finish his sentence.

With the Alessio family’s declination came that of Agua Caliente racetrack itself. In the early-morning hours of August 5, 1971, a towering fire reduced the track to ashes and rubble. Rumors began to circulate in Tijuana that the track had been deliberately torched in order to destroy important records on the grounds. But rumors are endemic in Mexico, and no proof of arson was ever presented. As widespread as the rumor of arson was the acknowledgement among those familiar with Agua Caliente’s turbulent history that yet another era had come to an end.

This is the first of a two-part article. Next week: powerful Mexicans and American professionals - 1972 to 1983.

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