Kentucky Horse Racing Authority Approves Breeders' Incentives Plan

After much debate and discussion, the Kentucky Horse Racing Authority approved the structure of a five-tier Kentucky Thoroughbred Breeders' Incentive Fund Nov. 21. The program will reward breeders of Kentucky-breds that win in maiden special weight, allowance, and stakes company, both in-state and nationally.

A subcommittee of KHRA members originally recommended a plan with "Kentucky First" and national components but opted to add grade I and claiming title components after additional discussions.

To qualify for the fund, a mare must remain in Kentucky from the time of conception until foaling.

"The key factor in all of this is every breeder who receives a check under this plan will have brought a mare here--which is the biggest economic engine we have--left her here for the year, and foaled her out," said KHRA and subcommittee member Kerry Cauthen. "No one will receive a check that is not creating jobs and significant economic impact in Kentucky."

State Sen. Damon Thayer, who sponsored legislation to create the incentive fund using the 6% sales tax paid on stallion fees, estimated to be $15-million per year, said he was pleased with the recommendations by the subcommittee and the fact the authority passed the regulations. "The small- and medium-sized breeders in Kentucky have won," he said. "I fully endorse the policy adopted by the racing authority today. It follows the legislative intent, which is to create an incentive for breeders to send their mares to Kentucky and to leave them here to give birth."

Thayer indicated Gov. Ernie Fletcher would sign the recommendations as an emergency regulation in order for the fund to be in place by Jan. 1.

The "Kentucky First" component offers incentives to the breeders of the winners of all maiden special weight, allowance, and stakes races in Kentucky. The bonus would be equal to 25% of the winning purse, excluding supplemental funds, with a maximum bonus of $10,000 per race. There would be no age limitation for the horses.

The national component would grant incentives to breeders of the winners of maiden special weight and allowance races held in other states for 2-, 3-, and 4-year-olds. The bonus would be equal to 10% of the winning purse, excluding supplemental funds, with a maximum bonus of $10,000 per race.

Under the Kentucky grade I stakes component, an incentive will be awarded to the breeders of the winners of all grade I stakes in the state. The incentive will be $100,000 to the breeders of the winners of the Kentucky Derby (gr. I) and Kentucky Oaks (gr. I). An incentive of $25,000 will be awarded to the breeders of the winners of all other grade I stakes in the state.

A national grade I component will award the breeders of Kentucky-bred horses that win grade I stakes anywhere inside the United States. The amount of that award is capped at $2,500.

The Kentucky claiming title component will be composed of four racetrack title awards and an annual Kentucky title award. Churchill Downs, Ellis Park, Keeneland, and Turfway Park will each have an incentive awarded to the breeder of the horse that has the highest claiming earnings at that track during the year.

The annual Kentucky title incentive will be divided among the breeders of the top three horses that had the highest cumulative claiming earnings at all Kentucky tracks throughout the year. It is anticipated the total amount to be awarded under the component is $200,000.

Breeders of Kentucky-bred horses that win outside of the U.S. will not receive an award at this time.

"The breeders incentive fund is currently not estimated to be large enough to allow this component," KHRA and subcommittee member Doug Hendrickson said. "However, it is our desire to award these breeders as soon as the funds become available."

Jim Gallagher, KHRA executive director, said the next step for the authority would be to resolve operational issues, such as when mare residency requirements would begin and how officials would verify that mares reside in the state.

"We have an umbrella to work underneath now, and that's a good start," he said. "We've got the master plan, and that is a major accomplishment. The devil is still in the details, and we've got a lot of details to work out."