Cha-Ching...

--Gary King

Kentucky appears to be one step closer to joining the party and introducing an expansion on gaming. I refrain from using the word bandwagon, as this would imply a knee-jerk reaction. People have worked long and hard at bringing this to the table, and their tireless endeavors should be appreciated whether or not you believe in the cause.

For those of you who don’t know, the following transpired in the Bluegrass on Monday. Governor Steve Beshear and state senator Damon Thayer introduced a bill in the Senate that, if approved, would put the issue of expanded gaming before Kentucky voters in November. The pros and cons of expanding gaming in Kentucky have been bandied about for almost two decades, but having the right to vote on it cannot be questioned. If that’s what the people of Kentucky want, then that’s exactly what they should get. We live in a democratic society, afterall.

The short-term benefits to the horse industry are self-evident, but the long-term ramifications are difficult to predict. As mentioned previously (click here), using gaming/slot money as a crutch is not necessarily a bad thing but it’s far from a permanent solution. Right or wrong, when an economy starts to struggle this subsidy will be number one on the chopping board. This is not a startling revelation and has been played out in places like Indiana, West Virginia, and Pennsylvania.

Although not exactly the same, this reliance is comparable to what occurred in Ireland over recent years. I am more familiar with this than the places mentioned above, so will elaborate upon it to highlight my point. Irish racing/purses were largely funded by government grants during the economic boom of the late 1990s and early 2000s. This era was dubbed the Celtic Tiger, as the country experienced unprecedented growth across almost all performance indicators. However, when Ireland started to experience a sharp downturn in fortunes, for reasons beyond this discussion, this subsidy got heavily criticized by certain politicians, the mainstream media, and the general public to some extent. As a result, the grant has been drastically reduced and purses have been slashed. The quality of racing has not necessarily deteriorated, but it cannot be a positive thing going forward. Strong and sustainable purses are the lifeblood of the racing industry, and there is no point in having one without the other. 

It’s interesting to note that on the day of the Kentucky announcement, revenue received by racetracks generated by VLTs in Ontario, Canada came under fire. Ontario’s Finance Minister Dwight Duncan said it was time the province look at the approx. $345 million tracks get annually from the Ontario Lottery and Gaming’s slots, particularly in light of a $16 billion budget shortfall. Duncan believes that his government should decide whether or not the money would be better spent elsewhere. This simply adds credence to the above argument.

When times are tough, any subsidy to racing will be questioned. Who wants to fund the Sport of Kings, at the expense of schools and hospitals? I fully agree that a strong Thoroughbred industry supports the rural community, creates jobs and can increase tax dollars. However, it doesn’t really matter what I think and the general public will never agree--especially in times of recession. Horse racing would be best served moving beyond this short-term aid, and coming up with new ways to sustain its future. Otherwise it will resemble an old gunslinger, living off a reputation before ultimately fading into the sunset...