Horsemen, Breeders Buy Time, Wait for Slots
With handle in January down about 9% from the same period in 2004, Philadelphia Park said its year-to-date purse overpayment has reached $1.9 million because of a commitment to boost purses while it waits to install slot machines. Meanwhile, the Pennsylvania Horse Breeders Association finished 2004 in the black, but not without some adjustments.The purse advances total about $20,000 a day under an agreement between the racetrack and the Pennsylvania Thoroughbred Horsemen's Association. Daily purses averaged about $104,000 at Philly Park a few years ago, but the figure reached $164,000 per day last December.Purses are expected to average about $350,000 a day when the full potential of slots is realized. Some tracks in the state hope to have slots online by February 2006.Estimated total revenue from the machines is $3 billion per year. Purses and breed development programs will get 12%-18% of gross revenue under a formula that funnels some money from non-track locations to horse racing.Pennsylvania Horse Racing Commission members noted the decrease in handle for January was a result of poor weather, as well as low turnout on Sundays when the Philadelphia Eagles pro football team played. The commission said total handle in the state for 2004 was $763.7 million, compared with $773.5 million in 2003.Meanwhile, the Pennsylvania Horse Breeders Association, which distributes earnings to Pennsylvania-bred horses, reported a positive year-end balance of $114,000 for 2004 even though it reduced its owner bonus payouts from 40% to 30%.PHBA executive director Mark McDermott said the association did well considering what it was up against."We took a conservative approach," he said. "The mandate from the commission was to not have a negative year-end balance. The goal was to be in the black, not red, despite declining handle. We tried to spend as much as we could by projecting the numbers that we were given."The bonus percentages decreased, but the breeders' fund paid out more in stallion awards, and we spent as much as we did last year. One of the problems was the contract with Philadelphia Park horsemen allowed them $20,000 more per day, but the breeders' fund money did not go up correspondingly."
by Jason Shandler
Date Posted: 3/29/2005 1:48:47 PM
Last Updated: 4/1/2005 5:20:49 PM
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