Four horsemen’s and breeders’ organizations representing three breeds in Indiana said June 16 they will, over a three-year period, give racetracks a share of their revenue from slot machines to help stabilize the tracks.
The Indiana legislature is currently in special session, and may address a few issues related to the horse racing industry in the state, officials said.
Under the slots law in Indiana, purses and breed development get 15% of gross revenue from the machines, which are located at Hoosier Park and Indiana Downs. In a joint release, the groups said they will take a pay cut: 12% this year, 13% in 2010, and 14% in 2011. The 15% will be restored in 2012.
Track officials have said the $250-million licensing fees and mandates they spend $100 million on slots casinos have hindered the operations, as has the economy. By comparison, the highest licensing fee in Kentucky, where racetrack video lottery terminals are part of a special session, the highest licensing fee is $100 million.
“When we gained slots at the tracks and the accompanying opportunity for statewide agribusiness development, our partners paid a heavy price in the form of an unprecedented and exorbitant licensing fee and development costs,” Larry Smallwood, chairman of the Indiana Horse Racing and Breeding Coalition, said in a statement. “They stepped up and invested in this industry because they believed in the future of Indiana racing. We believe in our partnership, and want to do what we can to achieve our shared success.”
In their first 12 months of operation, racetrack slots produced $383 million in revenue. Horsemen are to receive $57.4 million for purses, breed development, equine promotion and welfare, benevolence efforts, and association activities, officials said.
Directors of the Indiana Horsemen’s Benevolent and Protective Association, Indiana Thoroughbred Owners and Breeders Association, Indiana Standardbred Association, and Quarter Horse Racing Association of Indiana voted to temporarily cede a portion of that revenue to the two tracks, officials said.
“Our action today is a clear acknowledgment that Hoosier horsemen value the long-standing partnership with our tracks,” Smallwood said. “We were in this together in working for and winning slots at the tracks, and we are in this together to see that our partners survive and thrive in the bright future of Indiana racing.”