PA lawmakers join with Thoroughbred industry to fight funding cuts

by | 03.14.2012 | 2:40pm

Pennsylvania legislators joined representatives of the Pennsylvania Equine Coalition, a statewide group representing more than 10,000 trainers, owners and breeders of the horseracing industry in Pennsylvania, today at a press conference in the Pennsylvania Capitol Building Rotunda to express their support for the industry and discuss the need to restore a proposed $72 million annual diversion of funding for the Race Horse Development Fund to fund other programs.

Joining legislators today were individual horse owners, breeders and farm owners who will be devastated by the proposed cuts.  While a handful of legislators addressed the media, a number of others were also on hand to show their support.  The proposed cuts would mean that other states would offer more competitive purses and breeders awards, prompting fears from supporters in the legislature and industry leaders that the economic investment and jobs created by the Race Horse Development and Gaming Act (Act 71) will be lost, potentially costing Pennsylvania as many as 10,000 to 15,000 jobs.  Act 71 was specifically adopted by the legislature in 2004 for the express purpose of saving the horse racing and breeding industry in Pennsylvania, which is why the Race Horse Development Fund was created.

“The number one thing we talked about when debating Act 71 was saving the horseracing industry and protecting the jobs that are part of the horseracing industry — that was my number one objective,” said Rep. Gene DiGerolamo (R-Bucks).  “We are talking about jobs and when we are talking about taking this money away from the horseracing industry. The consequences of taking this money away from the industry would be disastrous.  We want to make sure the horseracing industry in Pennsylvania is vibrant.”

“We know that one of the industries in Pennsylvania that has been growing during this whole down time has been the area of agriculture,” said Rep Stan Saylor (R-York). “And the reason for the job creation in agriculture – our number one industry in Pennsylvania — is because of this Fund.  This will cost Pennsylvania jobs and the last thing we want to need do in this economy is for us to lose jobs. This fund is one of the best things to happen to agriculture in Pennsylvania in a long, long time.”  Saylor went on to say the legislature needed to make it a priority to find the money elsewhere in the budget to properly fund the agriculture programs that the money from the Race Horse Development Fund is being diverted to support.

Sen. Tim Solobay (D-Washington) noted that thousands of people would be directly impacted by the proposed cuts, including trainers, drivers, breeders, owners, and farmers who supply feed and other staples.  Solobay also addressed the misconception that the fund represents some sort of surplus. “This is not a surplus,” stated Solobay.  “This is a fund that grows to be used during the course of the summer on purses when all of the tracks are up and operating and used for purses  If this money goes away, it is going to devastate an industry, an industry that has earned national and world recognition.”

“The people who have invested in the equine industry expected us to deliver on the promises we made when we passed Act 71,” said Rep. Chris Ross (R-Chester). “When we changes the rules and introduce uncertainty, businesses pull out and jobs are lost.  We need to make this fund whole. We need to make sure we have a good, healthy industry that can compete successfully with New York, Maryland, Delaware and other states that are eager to take our breeders and our horseracing away from us.”

Rep. Scott Petri (R-Bucks) emphasized the impact of Act 71 on farmland preservation and open space, noting that he voted for Act 71 because of his desire to protect and preserve horse farms in his district and across the state.  Rep. Petri highlighted a significant amount of open space in his district that has been preserved as horse farms thanks to Act 71, noting that farms across the state had also benefitted.  Petri said that the proposed cut would move Pennsylvania's thoroughbred purse ranking from 5th place in the country to 17th and noted that the people who will be hurt the most by the cut are those individuals that owners use the purses to pay for services — veterinarians, stable hands, trainers, walkers and others.   “We should be focused on trying to move from fifth to number one,” said Petri.

“This was a commitment made to an industry,” said Carl McEntee of Northview Stallion Station in Lancaster County, home of 2004 Kentucky Derby winner Smarty Jones and the largest thoroughbred farm in the state of Pennsylvania.  “Northview moved to Pennsylvania as a direct result of Act 71 and has invested as much as $15 million in Pennsylvania.  When state government makes a commitment — as it did with Act 71 and the Race Horse Development Fund — and investors come and invest in your state, upholding that commitment becomes a matter of state credibility.”

The proposed diversion of $72 million in the 2012-2013 fiscal year, an amount that increases in future years, comes on top of a planned diversion of $49 million from the Race Horse Development to Race Horse Development Fund in the upcoming fiscal year.  These cuts would leave the fund nearly 30 percent below the lowest projections of what the fund would receive when Act 71 was adopted by the legislature in 2004.  Drastic cuts to the funds available for racing and breeding would cause individuals to make investments in other states, breed their horses in other states that provide better incentives, and race their horses in other states with better purses.  These decisions would have a ripple effect on thousands of Pennsylvania jobs, including horse trainers, stable hands, veterinarians, farmers that produce feed, and equipment suppliers.

According to economic data from the Department of Agriculture released in 2010, between 2001 and 2008, the value of the racing industry in Pennsylvania more than quadrupled thanks to Act 71.  In addition, the Department of Agriculture stated that due to the Race Horse Development Fund, the overall value of the equine industry increased by 380 percent to $3 billion with employment more than tripling from 13,870 to more than 41,100.  The proposed cuts would mean that other states would offer more competitive purses and breeders awards, prompting fears from supporters in the legislature and industry leaders fear that the economic investment and jobs created by Act 71 will be lost, potentially costing Pennsylvania as many as 10,000 to 15,000 jobs.

“Imagine the outcry from business leaders if the state attracted businesses to Pennsylvania through Keystone Opportunity Zones and then ended them without warning or decreased the tax benefits by 50 percent after a business had already located there,” said Salvatore DeBunda, President of the Pennsylvania Thoroughbred Horseman's Association.  “The Race Horse Development Fund represented a commitment by state government, a commitment that breeders incentives and purses would be at certain levels, which attracted individuals and businesses to Pennsylvania as a place to breed horses, purchase farms, and race horses.”

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