PA Lawmakers Join Horsemen in Fighting Cuts

The governor proposes taking $72 million from purses and breed development funds.

The one-day Pennsylvania Horse Conference served as platform for the state’s racehorse owners, breeders, and trainers to tout support from several lawmakers who oppose Republican Gov. Tom Corbett’s plan to divert $72 million a year in revenue for purses and breed development to agriculture programs.

The March 14 conference in the state capital of Harrisburg included a rally at the Capitol rotunda and ended with a reception at nearby Hollywood Casino at Penn National Race Course. Members of the Pennsylvania Equine Coalition and legislators were on hand.

The 2004 law that authorized slot machines at racetracks and standalone casinos was called the Pennsylvania Race Horse Development Act. When the first slots began operating in late 2006, 12% of gross revenue from racetrack casinos and 6% from non-track casinos went to horsemen for purses, breed development programs, and pension plans.

Table games were added a few years ago at all casinos, but horsemen get no cut of that revenue.

Several years ago a percentage of purse revenue was taken by lawmakers to pay for other programs; it amounts to $49 million in the next fiscal year. Corbett’s plan would take another $72 from the Pennsylvania Race Horse Development Fund.

The Thoroughbred and Standardbred industries are equally affected. Thus far, no money has been taken from the casino owners’ share of gaming revenue.

According to a release from the equine coalition, lawmakers are working to halt further reductions from purse and breeding funds.

“The number one thing we talked about when debating (the slots law) was saving the horse racing industry and protecting the jobs that are part of the horseracing industry—that was my number one objective,” Republican Rep. Gene DiGerolamo said. “We are talking about jobs. The consequences of taking this money away from the industry would be disastrous. We want to make sure the horse racing industry in Pennsylvania is vibrant.”

“The people who have invested in the equine industry expected us to deliver on the promises we made when we passed (the slots law),” Republican Rep. Chris Ross said. “When we change the rules and introduce uncertainty, businesses pull out and jobs are lost. We need to make this fund whole.

“We need to make sure we have a good, healthy industry that can compete successfully with New York, Maryland, Delaware, and other states that are eager to take our breeders and our horse racing away from us.”

“This is not a surplus,” Democratic Rep. Tim Solobay said. “This is a fund that grows to be used during the course of the summer on purses when all of the tracks are up and operating. If this money goes away, it is going to devastate an industry, an industry that has earned national and world recognition.”

In the roughly five years Pennsylvania has had casinos, racing has banked more than $1.1 billion, including purses, breed development, and horsemen’s pension plans. The state has received more than $3.1 billion, and casino owners have collected more than $4.2 billion, according to the Pennsylvania Gaming Control Board.

Casino and racetrack owners have been silent on the Corbett plan.

Sal DeBunda, president of the Pennsylvania Thoroughbred Horsemen’s Association, which is based at Parx Racing & Casino, likened Corbett’s move to decreasing tax benefits in business enterprise zones by 50% without warning. He said the outcry from business leaders in the state would be enormous.

“The Race Horse Development Fund represented a commitment by state government—a commitment that breeders’ incentives and purses would be at certain levels, which attracted individuals and businesses to Pennsylvania as a place to breed horses, purchase farms, and race horses.”

The Pennsylvania Department of Agriculture, under which racing regulation falls, has said the value of the equine industry since gaming was added jumped 380% to $3 billion. A study claims the number of industry-related jobs tops 41,000.

The equine coalition has six member organizations, none of which are racetracks.