rl, here is everything you ever wanted to know about the Performance Handicap Racing Fleet (PHRF)...
http://en.wikipedia.org/wiki/Performance_Handicap_Racing_Fleet
PHRF is a locally administered handicapping system that uses the perceived speed potential of a yacht as the basis for the handicap. An initial handicap is assigned based on comparisons with similar yachts. The handicap may then be adjusted based on the performance of the class of the yacht.