KEEP URGES COLLABORATION ON VLTS
The following op-ed, written by KEEP Executive Director Patrick Neely, is a well thought out plea for a reconsideration of expanded gaming in Kentucky. Refreshing in its details, it is clear that not only does KEEP want to continue to push for expanded gaming through collaboration but is also open to other ideas to help Kentucky’s signature industry.
- Bradford Cummings
By Patrick Neely
Executive Director, Kentucky Equine Education Project
During the last month, much has been written about expanded gaming in the context of our state budget crisis. Lost in most of the discussion about whether money from expanded gaming should be used to fill budget holes is the simple and sad truth that our signature horse industry is in a rapid state of decline.
It is not disputed, even by opponents of expanded gaming, that competitor states are successfully stealing our industry right out from under our noses. Using money from expanded gaming to significantly boost their purses and breeders’ incentive funds, states like Pennsylvania, Indiana, West Virginia and Louisiana are luring our racehorses and breeding stock out of Kentucky.
When horses leave, jobs go with them. Every horse that lives in the state of Kentucky is like a little factory, a full-blown jobs creator. Every horse requires people to grow their food, give them vet care, transport them, produce and sell tack and other equipment, build their barns and paint their fences, care for them on a day to day basis, shoe them and train them. Most racing and breeding stock also create jobs in the legal, insurance, advertising, and banking fields. Not to mention all of the employees at industry trade publications, sales companies, and of course, Kentucky racetracks. And how about the millions of dollars that come from worldwide tourists who recognize the beauty and attraction of our industry?
It is beyond dispute that tens of thousands of Kentuckians depend on the horse industry to make their living. And without a doubt, those jobs are being lost or moved to other states at an alarming rate.
The most common complaint I hear is that if our industry cannot stand on its own two feet, it does not deserve any special treatment. This would be akin to telling the University of Kentucky that they are not allowed to offer scholarships to their athletes, and then expecting them to “stand on their own two feet” and remain competitive. The simple truth remains—if your competitors are given a significant advantage, it makes it nearly impossible to compete. That is why the industry has been so steadfast in its request for a level competitive playing field.
In the wake of a recent Bluegrass State Poll that showed overwhelming support for putting video lottery terminals (VLTs) at Kentucky racetracks, and similarly showed an overwhelming desire of Kentucky residents to vote on the issue of expanded gaming, it has been suggested that the industry should support Sen. Damon Thayer’s proposed constitutional amendment, which would finally “let the people decide.”
It should first be noted that Sen. Thayer has done much good for Kentucky’s horse industry, including strong support of the Breeders’ Incentive Fund. However, we fundamentally disagree with Sen. Thayer’s approach to this problem. First, an amendment could not be voted on before November. It seems a foregone conclusion that our out of state competitors, who have spent tens of millions of dollars to defeat gaming amendments in other states, would no doubt spend whatever it took to defeat an amendment here in Kentucky. But assuming an amendment would pass, where does that get us?
According to Sen. Thayer’s amendment, the legislature is not required to allow VLTs at racetracks, even if an amendment did pass. It simply gives the legislature the option to do so. In other words, even if an amendment passed, we would be in the exact same place we are right now in 2011, asking the legislature to pass a statute allowing VLTs at Kentucky racetracks. If they won’t pass such a law now, why would they pass it a year from now? We don’t need a referendum to know that Kentuckians support the concept. Poll after poll has demonstrated that a wide majority of Kentuckians believe we should have VLTs at Kentucky tracks. So why not just pass the statute right now?
If the industry were to clear the amendment and legislative hurdles, the Thayer provision then calls for a local referendum to approve VLTs at tracks. If the local referendum passes, then VLTs go out to a bid process that is open to everyone, and the machines do not have to go to racetracks. So a big out of state casino company could open a stand-alone slots facility in the same cities as our racetracks. After the bidding, a license procedure would have to take place, and if New York and Maryland are any example, the bidding and licensure process can last several years. Finally, once all of that is accomplished, the winning bidders would have to build the facilities and get up and running.
Even if the industry cleared every one of those numerous hurdles, the process would quite clearly last several years. The industry cannot wait several years for permission from state government to compete. We are losing horses and jobs today. Timely action is critical.
So where does that leave us? Our industry is willing and anxious to work with our elected officials to arrive at a creative solution. The Speaker of the House has offered an idea that seems to be the right compromise. His plan would allow cities that have racetracks to vote on whether those tracks should be allowed to install VLTs. This proposal should answer most everyone’s objections. The local referendums could take place as soon as this summer, and would be handled in a manner similar to wet/dry alcohol votes. Assuming the measures passed, money could flow to purses, breeders’ incentives and other worthwhile programs in a very short time after that. This proposal should also satisfy those legislators who want to “let the people decide.” Under this scenario, the people who live in communities with racetracks will make the decision whether or not they want VLTs in their communities. This system works for alcohol sales, so why not use it to decide the VLT question?
Another idea is to slightly lower the pari-mutuel tax, and to divert the tax proceeds to purses and breeders’ incentives. Kentucky racetracks are double-taxed on the wagers they receive (pari-mutuel tax and corporate income tax), so if the state wants to continue double-taxing the industry, it would make sense to send some of that tax money back to support the industry. A tax reduction and redirection could save our struggling racetracks a small amount, and could redirect funding into purses and breeders’ programs. That change would not come close to leveling the playing field, but it would be a good start.
Horse owners, breeders, trainers, and racetrack operators are willing to work in a collaborative fashion to solve this monumental crisis in the industry. The only option that is unacceptable is legislative inaction. The future of our signature industry and thousands of Kentucky jobs are at stake.
Tags: Bluegrass State Poll, bradford cummings, damon thayer, Indiana, keep, Kentucky, Louisiana, patrick neely, Paulick Report, Pennsylvania, vlts, West Virginia
February 12th, 2010 at 4:11 pm
The speaker of the House’s proposal is the most sensible one I have heard yet. What can we do to help promote that idea?
February 12th, 2010 at 4:19 pm
What assurance, if we “fall into line” with the thinking that slots are going to “save” the horse industry, that the tracks are going to augment purses and not do everything they can do to get rid of horse racing like Penn National Gaming seems to be doing? Will CDI invest anything on the backside or in purses or will it all go for the whoop di do new Casino that’s free, while continuing to charge the horseplayer to come gamble. Before we become the willing shill for the racetracks and the commonwealth, where’s the guarantee that the funds aren’t going to be raided at some point in the future during another crisis of fiscal mismanagement.
The solution for racetracks around the country is to get state governments out of the horse racing business, not become the government’s tax collector.
February 12th, 2010 at 11:17 pm
Mr. Neely,
Please be so kind as to release all documentation relating to KEEP’s efforts to clean up the corrupt sales process, unscrupulous veterinary practices, doping throughout the industry as early as 2 yo sales, hidden ownership at sales where an unknowing owner unwittingly buys a horse from the agent who recommended it.
To my knowledge KEEP has done nothing to address this since they are basically an extension of this corruption. Surely Mr. Neely will not claim there is no corruption int he industry.
February 13th, 2010 at 11:40 am
Dear Mainstream,
Imagine my surprise this morning when I woke up to learn that our five year old organization is in fact responsible for all of the ills you listed in your latest missive.
In answer to your question - KEEP helped organize and facilitate the Sales Integrity Task Force, which focused on three areas - Licensing of Bloodstock Agents and Consignors, Tranparency in Ownership in the Sales Arena, and Transparency in Medication in the Sales Arena. The Task Force also added to the list of prohibited veterinary practices, including injections behind the knee prior to sale. Several members of the Task Force are also KEEP Board members.
The results of the Task Force can be found at http://www.consignorsandbreeders.com/MiscArticles/Recommendations%20of%20the%20Sales%20Integrity%20Task%20Force.pdf
February 13th, 2010 at 3:14 pm
Mr. Neely:
The update on Paulick seems to say you can kiss your “compromise” approach good-bye.
What’s with these Republicans nowdays? Guess the party of NO fits as it’s moniker…
But unfortunately, I don’t think you’re going to find the necessary voters to heed your call to vote the party of NO out.
Hey, where the hell is Whitfield and your other federal reps in this mess?
February 13th, 2010 at 4:01 pm
Slots can’t compensate for the lack of moral values of the industry’ self-serving poo-bahs.
February 13th, 2010 at 5:18 pm
But they sure help farms, owners, horses, jockeys and trainers decide to move from one venue to the slots venue.
Slots aren’t a panacea, but they do definitely drive the local market to stay or leave.
Morality isn’t a function of having or not having slots. Scum will always be scum. In the meantime, don’t confuse good horsemanship with an expanded gaming entertainment venue. I’m not defending slots. I’m defending Kentucky’s horsemen the right to compete on a level playing field with nearby slots/racing states….which is something more than Mr. Williams is willing to give his own constituents and fellow Kentuckians.
February 13th, 2010 at 6:35 pm
Patrick Neely - if your statement: “the most common complaint I hear is that if our industry cannot stand on its own two feet” is correct, then KEEP is abysmally ignorant of public opinion.
There are other, more pressing, complaints. Get the horses OFF DRUGS - ANY drugs, including Lasix-Salix-Furosemide. Provide aftercare for horses. Stop breeding more horses than the market can handle. Etc., etc.
Make racing attractive to the general public again. Fix the problems. Racing can survive on its own if you fix what’s wrong.
February 13th, 2010 at 6:54 pm
Noelle,
The statement you referenced pertains to the VLT debate, which was the overriding theme of the op-ed. I do not believe that those in the public who oppose our efforts to level the playing field do so because some horses run on Lasix. I would venture to guess that most of the general public does not know what Lasix is. Stated again, most of the people I talk to who are opposed to our efforts to equalize the competitive landscape say that if we can’t manage on our own, we should not receive special treatment, or a “bailout.”
They fail to realize that our competitors have been granted a significant advantage by other state governments that are anxious to take Kentucky’s industry away - and the jobs that go with the industry. You are talking about problems facing racing in general. The op-ed is discussing the problems facing the Kentucky industry in relation to the racing and breeding industries in competitor states.
February 13th, 2010 at 8:08 pm
Commissioner Neely,
Job well done, It is refreshing to hear intelligent replies from industry leaders. Hope you keep the dialogue open.
February 13th, 2010 at 9:42 pm
Patrick, thanks for taking the time to reply to the few of us left that still care. Some leaders write a bog then ignore the people who take the time to respond.
February 13th, 2010 at 9:44 pm
I meant blog, but bog may actually work.
February 14th, 2010 at 8:41 am
Patrick, how is it you continue to draw a 6 figure salary and don’t accomplish anything? Every year its the same thing with KEEP. Time to stop throwing money to this group. You might as well flush the money down the toilet. When the group was founded, it was by people who truly cared. The first executive director was forced out. She was a brilliant women and accomplished attorney. But they chose to bring in a political hack who makes nice speeches, cashes a big check and in the end nothing gets done. Sad. Don’t buy his bs, he wins no matter what.
February 14th, 2010 at 10:03 am
Harmon Willis 1V,
Thanks for the kind words - it’s always fun to throw pot shots from the cheap seats! Much harder to get your hands dirty and actually try to accomplish something.
But you raise a point - so let’s discuss it. What have we accomplished? I will quote from a Courier-Journal article that ran less than two weeks ago. “Statewide support for slots at racetracks is the highest measured by the Bluegrass poll since it began asking questions about expanded gambling in 2002.”
When I started at KEEP a little under three years ago, our polling showed that support for putting our racing and breeding industries on a level playing field registered at 40%. Since then, we have significantly moved the needle of public opinion, so that a clear majority of Kentuckians (59%) now support our efforts. That did not happen by accident.
It happened through a comprehensive grassroots and communications strategy to take our message to all parts of the state. The creation of the KEEP Speakers Bureau, coupled with KEEP staff spending days at a time on the road, talking to every Rotary Club, Lions Club, book club and knitting club around the state, talking about the importance of our industry, has certainly helped sway public opinion. Building a massive grassroots network to get engaged and involved has helped sway public opinion. Targeted communications through the mailbox, radio and internet have helped sway public opinion.
So besides a massive outreach program that has had tangible results, what else have we accomplished? We worked with our legislative leaders to draft a bill that would put our industry on a level playing field by allowing Kentucky tracks to install VLT’s. We made sure that purses and breeders incentives would be well funded. Also included in the bill was the removal of the sales tax on horse feed and equipment, and the creation of the Kentucky Breed Authority, which would have sent several million dollars to construct show facilities, trails, and the like. It was a comprehensive equine bill.
Now remember, in the twenty years this issue has been debated, a bill like this had never even made it out of a Committee. In 2009, after helping craft the bill, we set out to help get it passed. We staged a rally on the steps of the Capitol with well over 1,000 people in attendance. We submitted thousands of signed petitions. And our grassroots network swamped the Frankfort phone lines.
And for the first time ever, our bill was voted out of Committee. For the first time ever, our bill was taken up by the entire House of Representatives. And for the first time ever, our bill passed the House of Representatitves. We all know that it was then killed in the Senate.
So what have we accomplished? A burgeoning and active grassroots network. Helped to significantly swing public opinion. A bunch of legislative firsts, including passage by the House of Representatives.
Are we all the way there yet? Obviously not. We still have work to do. But it is clear that we are closer than we have ever been. I recognize that there will always be naysayers who would rather criticize than contribute, but I am encouraged by the resolve of the industry, and by the multitudes of people who are fighting with us every day to protect Kentucky’s signature industry.
February 14th, 2010 at 10:34 am
I have to agree Harmon. It is sad, groups are formed with the best intentions and flounder under these politicians. As you say this guy wins whether KEEP succeeds or not. But truth be told they take in a lot of money and do little to advance the cause.
February 14th, 2010 at 11:34 am
I don’t know what Mr. Neely looks like but I should. I should be sick of seeing his mug on local TV, debating Williams and jamming common sense down my throat. I should be seeing KEEP TV commercials and billboards around town. I don’t see enough pressure but then again I don’t know how difficult it is or if there is money to make this happen? Mr. Neely should be like a politician running for office 48 hours before the election.
On the other hand KEEP’s mission is to increase awareness of the benefits of Kentucky’s horse economy and to promote jobs and economic opportunities for Kentuckians through the Commonwealth’s world-class horse industry. Mr. Neely was not hired to fix racing’s complex problems.
February 14th, 2010 at 12:42 pm
Mr. Neely:
I understand that some progress has been made. And some of the comments are wanting more than just “KEEP” stinks because it’s not done yet. And yes, racing’s ills are not just Kentucky’s.
Here’s a thought, no one at KEEP takes home a paycheck (excluding expenses) until the VLTs are in KY. I think it would show commitment and resolve on KEEP’s part.
And your plan in the face of Williams’s iron curtain is what? And yes (again), a great poker player never tells the hand, but……
p.s. Can’t a lawsuit be filed at fed court that sues the KY legislature for blocking “pursuit of freedom, happiness and livelihood, etc”? Last I checked, the Feds have tried to pass legislation only to be blocked at state level. If gambling is legal in the US, where does the state of KY (love that acronym) and MD get the right to stop it or skim off it???? Also, you never answered my question as to where Whitfield and your other fed reps are.
February 14th, 2010 at 12:54 pm
As long as the house and senate can keep robbing Peter to pay Paul, the slots won’t get a fair hearing. They are about to run out of “raining day” funds to rob and will have to address all the painful cuts they have been putting off for years. Maybe new revenue will look better to some, when the smoke screens are gone and rock bottom is revealed. Sadly, however, I don’t think a coin will drop in Kentucky in the next ten years.
February 14th, 2010 at 1:16 pm
Well said D. Masters! This was the best quote in this whole chain:
“Here’s a thought, no one at KEEP takes home a paycheck (excluding expenses) until the VLTs are in KY. I think it would show commitment and resolve on KEEP’s part.”
Unfortunately guys like Patrick have the gift of bs, but when push comes to shove he will collect a good paycheck which is paid for not only by wealthy farm owners, but from all of us who eek out a living in horse racing. Some things never change.
February 14th, 2010 at 1:36 pm
People in this industry are always good for a laugh. Here we are making progress, and people write in to complain that the people helping us make progress are getting paid to do it. The answer is to make personal attacks on those who are working successfully on our behalf and demand that they work for free? Well, with that kind of attitude, is it any wonder our industry is in so much trouble?
February 14th, 2010 at 1:43 pm
L. Watters:
Well, I think I saw the term “grassroots” thrown around. Ummmm, grassroots doesn’t get paid 5 or 6 figures to talk….they do it for free.
My point about the paycheck thing is actually more related to people at the mid and top levels in any business or government and don’t get the job done and still get a paycheck.
This is a 21st century disease (not saying KEEP is). How any CEO, CFO, COO or industry/government can run a company into the ground or fail to provide safety to it’s employees or citizens AND STILL GET A FREAKIN’ BONUS OR JOB/PENSION defies the American work ethic and human logic. People are desperate for employment….it’s time to do something with your opportunity of employment. Or is everything litigation city now day?
But I’m listening Mr. Neely, Mr. Obama, Ms. Nepalitano, Gov Beshear, Sen Williams, yahduhyaduh. You guys ain’t cuttin’ the mustard and I’m tired of excuses.
I’m not saying one can go in there and kick butt and take names…but what the hell has happened to our country???????
February 14th, 2010 at 1:56 pm
Andrew:
I’m not against people getting a paycheck. What I’m not for is people getting paychecks and not doing their job.
Whether KEEP is earning its keep is something time will tell. But it certainly doesn’t seem to be going well. Many ways to skin a cat…seems some here think that it is taking too long, with little progress and a major pack of toads in the road.
I say get smarter than the toads and I did say KEEP was making some progress. But will it be enough, soon enough?
February 14th, 2010 at 2:50 pm
Has anybody asked Williams why he so adamently objects to slots at the tracks? I’d love to hear his logic, given that Churchill Downs is literally 20 minutes from two full-scale casinos. To insinuate that he doesn’t want slots in Kentucky is laughable and totally disingenuous - we’re talking about geographic semantics.
Williams has made no secret of his patronage of Indiana casinos, so I guess what’s good for him isn’t good for the rest of Kentucky? I wonder what type of payments - either by campaign contributions or casino markers - that this snake is getting from casino interests to stonewall the horse industry.
I am a lifelong Kentuckian and horsemen who is about to move my stable to Pennsylvania. The business in Central Kentucky is more than depressed - it’s dead, and I’m afraid it’s past the point of full recovery. The current situation in Kentucky mirrors what happened to the auto industry in Detroit. Forty years ago people were sure that city would always be the epicenter of the car world, and now it’s a ghost town where you literally can’t give a house away in some parts of town. Get ready, because the same will hold true in Lexington.
The horse industry will survive - we can just relocate. It’s the industry here that is being irreparably harmed. People and horses have left Kentucky, and many of them have gone for good. In Lexington anybody who wanted a job could always get one at a local farm or the racetrack. Now experienced horsemen go begging, and sales of most ancillary businesses are sagging. It’s sad and more than a little pitiful to see what one man has basically wrought to his constituents.
I am also a Republican. I chose this party because it is historically pro-business that does everything it can to assist business and commerce. It clearly seems that Williams and his henchman Damon Thayer are working to stagnate an industry that not only provides a boatload of tax revenue to the state but could conceivably provide exponentially more. Since when does a Legislator block business that puts money in the state coffers?
I have to laugh when I read how Williams is so adament that the public decide on slots via a public referendum. Funny how he didn’t think the same courtesy was needed when he strong-armed and steered $12 million to a private college in his district, the University of Cumberland.
Legislators like Williams who play God are exactly what’s wrong with professional politicians these days and why term limits for all offices are essential.
February 14th, 2010 at 4:07 pm
Peter Green:
I agree with your post, save for one point, term limits…we have them in the US and they are called elections. Now, I don’t disagree with the possibility that the potential electorate may be dumber than a box of rocks, easily manipulated and certainly self-serving and game playing of elections may muddy that enterprise, but we have term limits….vote the toads out!
How many people you know that don’t either care to know canidates, issues or even drag their butts out to vote???? I know a ton!
KEEP should bang Williams and the rest of the trolls on job creation and killing jobs..NOW!
February 14th, 2010 at 5:12 pm
I forgot recall movements as a point of option also…..let’s see how much KEEP has gotten with popular support polls to wit, a recall movement for malfeasance . Bring ‘em all down.
Yah, I know…recalls cost money. But you can pay now or later. Later always cost more.
Still no answer on the KY fed reps.