More than 30 legislators listened Wednesday afternoon as Kentucky racing officials explained the challenges faced by the industry, including mare reproductive loss syndrome and competition from gaming operations in neighboring states. No solutions or suggestions were offered during the hearing at Papa John's Stadium in Louisville, but they might be just around the corner.
Racetrack officials and horsemen met the week of Aug. 20 to seek common ground on issues and perhaps devise a legislative strategy for 2002. During previous General Assembly sessions, legislators have told racing industry officials they must be on the same page, and according to reports, they are. What the legislative wish list will include, though, remains to be seen.
The hearing, the third of three sponsored by the Kentucky Racing Commission, drew about 150 people, including many mutuel clerks who are members of Racetrack Employees Union Local 541. About 20 Churchill Downs employees were on hand in a show of support. Legislators in general seemed receptive to the hearings and the industry's plight.
"There are black clouds gathering on the border of Kentucky," said Don Sturgill, counsel for the Kentucky and National Horsemen's Benevolent and Protective Association. "The legislature has supported us in the past, and if a bill is agreed upon (for next year), we may need the legislature's help once again."
As has been the case with previous hearings, no one came out in support of alternative forms of gaming at racetracks, though one hot topic during the hearings has been the tracks that have used slot machines or video lottery terminals to transform their product. Another issue has been the excise tax on pari-mutuel wagering, which Churchill Downs president Alex Waldrop said is helping to stymie capital improvements.
"We have a very expensive plan," Waldrop said. "It would cost $20 million just to fix what's there-to change rotting wood to steel and concrete. We can't do it without cooperation and assistance from state government. Churchill Downs will put a lot of its own money into the project. We just want to find creative ways to use incremental revenue to build a state-of-the-art facility."
"If we don't move ahead, Churchill Downs could become the largest museum in Kentucky," said former Rep. Susan Johns, now a trainer based in Louisville.
David Switzer, executive director of the Kentucky Thoroughbred Association, and Nick Nicholson, president of Keeneland, again addressed mare reproductive loss syndrome and its ongoing impact on the breeding industry. Switzer said it's a lot more than a projected tax loss of $2.2 million in stud fees-for example, $950,000 won't be spent to have foals' feet trimmed before yearling sales.
Switzer showed figures that estimate a $165 million decrease in yearling sales revenue in Kentucky in 2003. He also said there is serious concern that some of the 18,000 mares that are bred or boarded in Kentucky may not be back because the cause of the syndrome still hasn't been determined.
Nicholson said the "first hard impact" would be felt during the Keeneland November breeding stock sale. There will be "substantially fewer" horses in the sale, he said, because of the syndrome, not the economy or a lack of quality horses.
When asked for details after the hearing, Nicholson said Keeneland isn't ready to put a hard number on the November catalogue, "but logic dictates it's going to be down. There were 2,500 fewer mares in foal this year."
During his presentation, Nicholson touched on the exponential effects of the syndrome. For instance, if 1,250 of the lost foals were female, and 1,000 of them went on to become broodmares that each produced 10 foals, 10,000 horses would be lost from the gene pool.
"The syndrome has a silent, long-term detrimental impact," Nicholson said. "There's nothing we can do to change the numbers."