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Wolfe's Redirection of Horse Racing Funds Causing Financial Problems for Industry

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A horse and rider work during practice on the Penn National Race Course racetrack on a foggy morning Nov. 29, 2006, in Grantville, Pa. Carolyn Kaster / AP photo

(The Center Square) – A report released Thursday by the Pennsylvania Gaming Control Board shows that 2019 was a mixed year at best for the state’s horse racing industry.

The state’s six harness and thoroughbred tracks saw increases in the number of starts, number of races and the purse amount. However, there are plenty of signs of concern for the industry, perhaps none bigger than the taxable handle, which dropped by 10.8 percent to $300.1 million last year.

Taxable handle has dropped every year since at least 2009, when the taxable dollars wagered on racing within the state was $733.8 million, according to the PGCB reports.

Adding to the concern is the amount that the state’s casino industry supports the sport. The PGCB notes that 89 percent of the purse money comes from slot machine revenue. The state’s tracks are among the 12 casinos currently operating across the commonwealth.

The report on 2019 comes as the tracks and racinos are trying to rebuild after the COVID-19 crisis shut them down for months. Even as racing has resumed in the state, there are still repercussions. Last week, the Thoroughbred Daily News reported that Parx Racing canceled both the Pennsylvania Derby and the Cotillion Stakes, two Grade I stakes races that features $1 million purses.

“We will not be running any open stakes races this year,” Parx Director of Racing David Osojnak told the publication. “We will be going on hiatus. The virus, the plague, just wiped out everything. We think we will be able to come back stronger in 2021.”

Another factor that played against the Pennsylvania Derby, typically held in late September, was the rescheduling of the Kentucky Derby and Preakness Stakes Triple Crown races for the fall.

Even before the virus, the future of the industry looked bleak as Gov. Tom Wolf proposed cut more than $200 million from the state’s Horse Racing Development Fund to pay for a new scholarship program. The fund, which accounts for about 10 percent of the revenue produced by the slots at the state’s casinos, generated about $238 million for racing in 2019.

Besides subsidizing purses, the fund is used for other racing-related purposes, including the preservation of farmland used by horse owners and breeders.

The number of breeders is another statistic in decline. There were 713 in business in the state in 2018, and just 640 last year according to the report. In addition, while the number of starts, or race entries increased, the number of actual horses in the state dropped by more than 1,000 to 15,567.

In the report, PGCB officials say the increase in sports betting across the state may help racing. Of the state’s seven off-track betting parlors, three already feature retail sportsbooks.

“Certainly, the hope is that the addition of sports wagering within these locations may attract a new fan base for the horse racing industry,” the report stated.


republished by The with permission of