Tracks, Horsemen Agree on Splits in Kentucky

Kentucky's Thoroughbred racetracks and horsemen's associations apparently struck a deal the week of Jan. 21 on revenue splits that will lead to alternative-gaming legislation. Under the plan, the state, not the racetracks, would get the lion's share of revenue from track-based slot machines or video lottery terminals.

Turfway Park president Bob Elliston said Jan. 25 the state's five Thoroughbred tracks -- Churchill Downs, Ellis Park, Keeneland, Kentucky Downs, and Turfway -- agree on the plan. He said he is "almost positive" the document has been signed by the state's two horsemen's groups, the Kentucky Horsemen's Benevolent and Protective Association, and the Kentucky Thoroughbred Association.

Marty Maline, executive director of the Kentucky HBPA, was traveling and not available for comment. KTA executive director David Switzer told the Lexington Herald-Leader it's a done deal.

Under the proposal, details of which will be made available when the final touches are put on legislation, the state would get the largest cut of revenue, followed by horsemen (through purse money), and the racetracks. That's after operating costs, which would be absorbed by the tracks in what has been described as a "break-even" proposition.

In some other states with tracks that have VLTs, such as Delaware and West Virginia, tracks get the largest percentage of revenue up front because they have to provide the infrastructure. Apparently under the Kentucky proposal, the track percentage would come out after operating costs are determined for the tracks.

"It takes money to operate these types of facilities," Elliston said. "We're assuming the operating cost is a break-even, and that of what's remaining, the majority needs to go to the state of Kentucky. The second-most amount of money would go to purses, and what's left would go to the tracks to create some return on investment."

Elliston said the industry is "pretty close on a legislative package."

"We're putting together the final details of an agreement to generate new revenue for the state and to protect the horse industry," Churchill president Alex Waldrop said. "There a lots of steps to come. We continue to make progress and have come together in an unprecedented fashion as a horse industry in this state. That fact alone speaks volumes about the seriousness of the issue and the industry's resolve in meeting the challenge."

As of Jan. 25, some Standardbred interests were waiting to see the agreement between Thoroughbred tracks and horsemen. It is unclear whether the Kentucky Harness Horsemen's Association and the state's three harness tracks -- The Red Mile, Players Bluegrass Downs, and Thunder Ridge Raceway -- will employ the same revenue deal or come up with their own, but in any event, any gaming legislation that is introduced will include both breeds, officials said.