Decline of revenue to PA Horse Fund continues
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Warmer temperatures and the beginning of the summer race season were not enough to stave off the continued downward trend in racetrack casino slots revenues as another 2.8 percent decline was reported for the month of May, compared to the same month in 2012. The decrease in slots revenue caused funding for the state's Race Horse Development Fund -- which supports live horseracing and breeding in the state -- to decrease by approximately $650,000 for the month of May compared to last year.
"Although the declines in revenue for May was slightly lower than previous months, we have seen steady declines for the Race Horse Development Fund in 10 of the past 11 months,” said Pete Peterson, spokesperson for the Pennsylvania Equine Coalition. "This downward trend is very real and has major repercussions for horse racing in the state of Pennsylvania as competition from neighboring states continues to eat away at overall revenue.”
The Pennsylvania Equine Coalition projects that funds to the Race Horse Development Fund – which are based on the performance of slots revenue at the state's racetrack casinos – will fall approximately $15 million short of the Governor's revised FY 2013-14 budget projections, and $26 million short of initial projections made by the Governor during the state budgeting process in February.
"It is clear that competition from neighboring states is negatively impacting revenues for Pennsylvania's racetrack casinos and will continue to do so,” said Peterson. "These decreases will impact horse racing and breeding industry in Pennsylvania, forcing cuts in purses and breeders incentives. Given the hit we are already taking from increased competition, the budget proposal to divert $31 million from the fund could drive small businesses out of Pennsylvania to other states that offer more attractive purses and incentives.”
The Pennsylvania legislature legalized casino gaming in the state as part of an effort to save and revitalize the horse racing and breeding industry, and it succeeded. According to the Department of Agriculture, as a result of casino gaming, the economic impact of the racing industry in Pennsylvania more than quadrupled and employment tripled from 13,870 to more than 41,100.
"Pennsylvania has been a success story, a model for other states,” continued Peterson. "Recent wins by PA-bred horses during the Kentucky Derby weekend have caused the racing industry to take notice of the tremendous strides made in Pennsylvania. With every win in the national racing spotlight, our state attracts new interest by owners, trainers and breeders looking to find the most favorable conditions to grow and prosper. If the RHDF becomes a pool of money that can be dipped into by state government to fund other government programs, businesses involved in the horse racing industry are not going to invest in Pennsylvania. That in turn will have a ripple effect on the farmers who produce feed, veterinarians and others who care for the horses, and small businesses that sell supplies. Horse racing is in an industry that needs to be nurtured in Pennsylvania, because it is the horses themselves that are the economic engines and job creators.”
The Race Horse Development Fund enhances live horse racing and breeding programs in the Commonwealth by supplementing purses and enhancing race horse breeding incentives. The fund was a crucial component of Act 71 of 2004, the Pennsylvania Race Horse Development and Gaming Act, which legalized slot machine gaming in Pennsylvania in an effort to save the Pennsylvania horseracing and breeding industry.(PA Equine Coalition)