Kentucky to Receive $1.5M in Source-Market Fees
Updated: Thursday, November 9, 2000 10:03 AM
Posted: Tuesday, November 7, 2000 1:11 PM
The National Thoroughbred Racing Association, through its NTRA Services subsidiary, will distribute $1.5 million in fees generated by the TV Games Network to Kentucky racing interests. The money was to be distributed during a press conference Oct. 26 -- just a day before 22 racetracks announced their intentions to leave the NTRA -- but the event was postponed.
The source-market fees were generated from betting by TVG subscribers in Kentucky from September, 1999, through September of this year. Most of wagering occurred in Louisville, where TVG is available on basic cable.
The fees will be distributed horsemen and racetracks in the state by formula. Half of the money -- $750,000 -- will go toward purses.
TVG chief executive officer Mark Wilson said the company looks forward "to helping racetracks and horsemen in other states realize this new growth potential." Currently, TVG is operational in Kentucky, Maryland, Oregon, and Louisiana.
Churchill Downs president Alex Waldrop said source-market fees "are an important part of any account wagering operation." Both David Switzer, executive director of the Kentucky Thoroughbred Association, and Marty Maline, executive director of the Kentucky Horsemen's Benevolent and Protective Association, said they look forward to further growth in account wagering.
Based on a blended takeout rate of 20%, NTRA Services pays 10.5 cents of every dollar wagered (the source market fee) to tracks and horsemen in the market in which the bettor resides. Other money goes toward taxes (0.25%), NTRA Services (0.75%), Host simulcasting fees (3%), and TVG production and operating expenses (5.5%).
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