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Experts Describe Consequences of Raiding PA Race Horse Fund
On May 2, 2012 ·
Harrisburg, May 2, 2012 — In testimony before the Senate Democratic Policy Committee today, Pennsylvania horse breeders, trainers, and veterinarians described the economic success of the Race Horse Development Fund, and the risks to the state’s economy if the fund is raided to plug budget holes.
“We heard a very convincing case that horse racing has defied the recession, created jobs and boosted Pennsylvania’s agriculture economy,” said Sen. Lisa Boscola, the committee’s chair. “Competition for jobs and investments is fierce and we can’t afford to lose one single job in this economy.”
When Pennsylvania legalized gaming in 2004, a prime motivator was the revival of the horse racing industry, a key component of the state’s agriculture economy and tradition. The Race Horse Development Fund is fueled by 11 percent of slot machine proceeds.
Gov. Tom Corbett’s 2012-13 budget calls for taking $72 million from the fund to plug other holes in the agriculture budget.
Sen. Tim Solobay, D-Canonsburg, said he requested the hearing out of concern for the 225 jobs at The Meadows – and those of another 1,000 horsemen — that are supported by racing at the Washington County facility.
“Clearly, the race horse fund has done what it was intended to do, and it has done it through tough economic times,” Solobay said. “If Pennsylvania is going to recover from the recession, we have to keep what’s working and cut what’s not working. Raiding the race horse fund would be shortsighted.”
Since the fund was created, it has become a model for surrounding states which have emerged as competitors as Pennsylvania has returned to the top tier of racing states, industry officials said.
Purses at Pennsylvania race tracks jumped from $75 million in 2001 to $700 million in 2009 while the Department of Agriculture estimated that the slots law (Act 71) created 40,000 racing and agriculture jobs. An independent study estimated the industry’s annual economic impact at $490 million.
“One of the purposes of good government is to create an environment and framework that supports opportunity. Pennsylvania did just that,” said Joe M. Thompson, president of the Standardbred Breeders Association of Pennsylvania. “The better the racing the more opportunity there is for better farms, better mares, better stallions, better vets, blacksmiths, hay, straw and all the supplies required to run a horse operation.”
The progress has drawn national attention and investment, but cutting $72 million from the fund would reverse the progress and make industry observers wary of Pennsylvania’s economic future, according to experts.
“You could have a total collapse of these investments,” Thompson said.
Solobay said the economic impact of raiding the race horse fund could go well beyond the $72 million price tag.
“We made a commitment to attract investment, and the investors responded,” he said. “If we don’t keep our end of the bargain it sends a terrible message about the way we do business.”
Boscola said the Policy Committee has already discussed numerous ways to fill budget gaps without cuts to economic programs that are working.
“As the budget progress moves on, we are ready to work with the administration, as well as colleagues on the other side of the aisle, to find solutions that are real and sustainable,” she said.
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