Three Kentucky horse industry groups have agreed to finance an economic impact study to help determine how a new state breeders incentive fun should be crafted.
A subcommittee of the Kentucky Horse Racing Authority (KHRA) requested the study, which will be performed by Dr. Paul Coomes, professor of economics and National City research fellow in the College of Business and Public Administration at the University of Louisville.
The three groups- the Kentucky Thoroughbred Farm Managers Club (KTFMC), the Kentucky Thoroughbred Owners and Breeders (KTOB), and the Kentucky Equine Education Project (KEEP)- have agreed to pay for the study, said Sen. Damon Thayer. Thayer is the author of the legislation and Senate chairman of the Horse Farming subcommittee.
"Each industry group and their members recognize the potential impact this new fund can provide," Thayer said. "This study will provide critical data that will help the Kentucky Horse Racing Authority make an informed decision on how best to create incentives for broodmare owners to breed their mares in Kentucky."
The legislation, signed by Gov. Ernie Fletcher in March, moves 80% of sales and use taxes on breeding a stallion to a mare in Kentucky to the new Kentucky Thoroughbred Breeders Incentive Fund. Two other funds- for Standardbreds breeders and other horse breeders- were also created. The incentive program is part of a pledge by Gov. Fletcher to pursue tax incentives and other means of ensuring the strength and growth of the Thoroughbred industry in Kentucky.
One of the issues discussed by the groups is whether to reserve the fund for horses that race in Kentucky or include those that race elsewhere. But all groups are supportive of the study.
"I'm especially appreciative of Gov. Fletcher and the General Assembly for passing the legislation that will provide the $12 million to $15 million that will be generated," said former Gov. Brereton Jones, chairman of KEEP. "The fund should be used to create the maximum number of jobs and the maximum economic development opportunities. This is the right approach. Not only the entire horse industry united, but Gov. Fletcher and the entire General Assembly united in this effort."
"It is important that we develop good economic data to use as a tool for developing a breeders incentive program that will result in increasing economic growth for our Commonwealth, as well as benefiting the signature industry of Kentucky," said David Switzer, executive director of the KTOB.
Ken Wilkins, president of KTFMC, said farm managers welcome the study by Dr. Coomes
"We have strived since our earliest involvement to provide good information to our members on this complex issue," he said. "I expect this study to take into account the many tentacles that Kentucky's number one agricultural crop extends into our international market. We trust this is another major step toward working with our fellow horsemen to find a plan that will encourage breeders to choose Kentucky as the best place to be, if you are going to breed Thoroughbreds."
The legislation requires the KHRA to create administrative regulations by Jan. 1, 2006 establishing conditions and criteria for distributing money from the funds.