Ohio HBPA Says 4% of VLT Revenue Insufficient

Ohio horsemen said they will have to negotiate VLT purse percentages with racetracks.

The Ohio Horsemen’s Benevolent and Protective Association issued a statement July 16 confirming it will have to negotiate with racetracks for purse revenue from video lottery terminals.

The Ohio HBPA had expressed concerns July 13 after a directive and companion legislation authorizing racetrack VLTs failed to include protection for live racing or a percentage for purses. The state will get 50% of gross revenue, and seven racetracks the other 50%.

The Ohio HBPA said it represents more than 3,500 Thoroughbred owners and trainers. Other horsemen’s and breeders’ groups in the state, which has Thoroughbred and Standardbred racing, haven’t publicly spoken out on the VLT issue.

“Despite our best efforts to obtain legislative action to guarantee a percentage of VLT revenue for purses, (the July 13) directive by the governor contained no such language” Ohio HBPA president Jim Yaegel said.

The Ohio HBPA and the Ohio Harness Horsemen’s Association will now have to negotiate with the tracks the percentage of VLT revenue that will be used for purses, the organization said.

River Downs general manager Jack Hanessian told The Blood-Horse July 14 the tracks realize they’ll have to strike a deal with horsemen given the fact Democratic Gov. Ted Strickland’s directive and the companion legislation don’t address purses or breed development. But he said the tracks must deal with a 50% tax rate, one of the highest in the country for racetrack gaming.

The Ohio HBPA said the Thoroughbred breeding industry in Ohio “has suffered greatly” in the past decade due to declining purses; breeders have moved their operations to surrounding states that offer more lucrative breeding incentives. The group said 634 Thoroughbred foals were registered in the state in 2001, but that number dropped to 236 in 2008, a 63% decline.

Earlier in July, Ohio HBPA executive director Dave Basler told a Senate committee horsemen believe 10% of VLT revenue is in line with revenue paid in other states. The chief executive officer of MTR Gaming Group, which owns the Scioto Downs harness track in Columbus, Ohio, told the same committee 4% is sufficient.

“Four percent of VLT revenue for horsemen simply isn’t enough to revitalize the racing industry in Ohio,” Basler said in the July 16 statement. “Studies have proven pari-mutuel wagering, which generates the majority of our purse money, suffers when slot machines are added at racetracks.

“Why are Ohio’s horsemen being asked to take approximately two-thirds less than the horsemen in the surrounding states which have passed similar legislation? The horsemen in Ohio deserve to be placed on a level playing field with the horsemen in surrounding states, and the more than 15,000 horse racing industry-related jobs depend upon that happening.”

Track officials haven’t publicly discussed how much they intend to offer horsemen during negotiations. It’s also unclear whether the percentage will be same for both breeds and all tracks.