Atlantic City casinos have agreed to boost financial help for New Jersey's racetracks, but officials said long-term funding issues remain.
The deal, announced March 3 by New Jersey Gov. Jon Corzine, is meant to help racing but also protect casinos from new in-state gambling competition. As part of the deal, which still must be finalized by casino officials, the horseracing industry won't pursue video lottery terminals at tracks for three years.
Under the agreement, casinos would provide $90 million over three years to the horseracing industry, largely to supplement racing purses but also to support Thoroughbred and Standardbred breeding programs. The casinos provided $86 million to the horseracing industry over the last four years.
Racetracks have lobbied for approval for VLTs at tracks so they could compete against tracks in nearby states that now offer VLTs or slot machines. The Atlantic City casinos, which continue to report declines in revenue, have opposed the plan.
"Both the equine industry and the casino industry play important roles in New Jersey, from preserving open space to attracting visitors, and it was essential to strike a balance that will allow both industries to thrive," Corzine said in a statement. He said the agreement involves no taxpayer dollars and will not cut casino tax revenues for the state.
The Standarbred Breeders and Owners Association of New Jersey was the first to weigh in on the deal. The organization said the future of horse racing is up in the air without a stable source of funding.
Wagering on New Jersey horse races declined 25% to $924 million in 2006 from 1999, according to a state-paid study released last year.
“It was a bittersweet victory,” SBOANJ president Tom Luchento said in a March 4 statement. “While the Standardbred horsemen of New Jersey are grateful for the funding which will allow the state’s tracks to maintain their purse levels for the next three years, this agreement is only a stopgap measure. There are also many details to be worked out as far as the distribution of the supplement."
It's unclear how the subsidy will be spent. In the past, it has gone to Monmouth Park, Meadowlands, and Freehold Raceway. But next year, Atlantic City Race Course has been ordered to race at least 20 days, so it may receive purse money as well.
“For the future of the racing and breeding industries in New Jersey, we need to find a permanent solution in the form of other types of gaming at the racetracks so that we can exist on a level playing field with the tracks in the surrounding states – New York, Pennsylvania and Delaware – which already have VLTs or slots,” Luchento said.
The state study estimated New Jersey would earn as much as $433.5 million a year by putting VLTs at tracks.
