KY Identifies Problems, But Needs Money

A report on the state of horse racing in Kentucky is nearing completion.

The Governor’s Task Force on Racing in Kentucky is close to preparing and releasing a report pinpointing problems and offering recommendations that ultimately will require a lot of money—something in short supply given an ongoing budget crunch.

The task force, formed earlier this year by Gov. Steve Beshear, is looking at issues such as regulation of horse racing, development of an equine drug-testing laboratory, pari-mutuel security, and competition for the racing and breeding industries from other states. None of the issues are new—in fact several are very old—but the sense of urgency to address them has perhaps never been greater in Kentucky.

Where the money will come from for various enhancements remains to be seen; a logical source is alternative gaming at racetracks. Whether the governor and his administration ultimately will call for such legislation isn’t known, but a push for casino gambling by Beshear earlier this year stalled in the General Assembly, again a victim of politics.

Funding for horse racing and breed development are clearly linked with gaming in other states. Keeneland president and task force member Nick Nicholson provided the full task force with a subcommittee report Oct. 28 that showed what Kentucky’s industry is up against. The numbers continue to change, but the threat doesn’t lessen, he said.

According to information compiled by the task force committee, from 2006 to 2008, Kentucky-based trainers made about 500 more starts at six racetracks outside the state. Even at Mountaineer Casino, Racetrack & Resort, where slot machine-fueled purses have leveled off in recent years, 135 Kentucky-based trainers have started horses there this year compared with 98 two years ago.

During that same period, Hoosier Park Racing & Casino attracted 30 more Kentucky trainers, a number that figures to increase greatly in coming years. Thoroughbred purses at Hoosier Park are expected to double in 2009 to $16.1 million from $8.7 million in 2006, according to the committee report. Indiana Downs will see a similar increase.

The Indiana competition will directly impact the amount of low to mid-level horses that form the foundation of Kentucky’s year-round racing circuit. Ellis Park owner Ron Geary, a member of the governor’s task force, already is working to retool the track’s 2009 meet to offer fewer racing dates should horsemen approve.

The report indicates purses in New York, where a video lottery terminal casino at Aqueduct finally has the go-ahead, could hit about $200 million a year by 2013 at the three New York Racing Association tracks. In 2007, the figure was about $120 million.

“The competition for horses among racing jurisdictions is at an all-time high,” Nicholson said. “Racing secretaries are pressuring trainers not to ship to places like Kentucky. It won’t take years for Ellis Park to feel this. It will feel it in days and weeks (next year). It’s the same thing with Turfway Park and Churchill Downs.”

Nicholson also told task force members the Kentucky breeding industry, though strong, isn’t immune from competition. The amount of money in the Kentucky Thoroughbred Development Fund, which offers state-bred purse supplements, continues to drop as handle declines. The Kentucky Thoroughbred Breeders’ Incentive Fund is growing, but the $15.5 million figure in 2007 is well behind funds in other states such as Pennsylvania, where the average earnings per start for a Pennsylvania-bred increased 36.5% last year.

“For many of us, this subcommittee has been a wake-up call,” Nicholson said. “It’s not only a trend, it’s a deluge of the trend. We cannot accept the status quo.”

Task force chairman Tracy Farmer said the group plans to meet again Nov. 25 in Frankfort, the state capital. All of the subcommittee reports will be combined into one document that will be present to the governor before the end of the year.