Lexington, KY - For years, horsemen across the state, supportive legislators and members of the Kentucky Equine Education Project (KEEP) have had a single message: our Thoroughbred racing and breeding industry is being compromised by 11 of the states we compete with for racing purses and breeders' incentive funds. They enhance both with added gaming revenue from video lottery terminals (VLTs). The lone holdout was Ohio, and their governor now wants VLT legislation to be fast-tracked in the Buckeye State.
Meanwhile, here in the Horse Capital of the World, we can't even get a fair hearing in the state Senate on a proposal that would help level the playing field so we can maintain that much sought after title.
I was in a meeting recently with a gentleman who owns an equine supply store. He told the group that he had to lay off employees and ask others to take a 20 percent cut in pay because his sales volumes are down that much. But in almost the same breath, he said he was considering opening a new store - in Pennsylvania, because that's where horses are moving.
A new father who attended the same meeting was bemoaning the fact that he missed seeing his son for four of his six young weeks because he was in Indiana selling feed that ordinarily would be sold here. An unhealthy horse economy has a ripple effect across the entire state, negatively impacting jobs and local economies that may not seem to be reliant on the horse industry, but in many ways are. In the coming months, the situation will continue to worsen.
A recent survey of 44 farms that are members of the Kentucky Thoroughbred Association revealed that between 2008 and 2009, more than 530 horses had been moved to other states so they could be eligible for more lucrative breeder incentive funds.
Stallion covers this year were off some 40 percent at the lower price level because of the number of mares who have been moved out of state. Since our breeders' incentive fund is so closely tied to the sales tax on stud fees, next year's incentive pool will be even lower.
Churchill Downs had to drop Wednesday racing this year because it couldn't fill its race cards. Meanwhile, tracks in Erie and Philadelphia averaged eight or nine starters in each race almost every day.
It is no secret that Ellis Park will likely end racing this fall after more than 85 years. If Ohio moves ahead with VLTs, Turfway in Northern Kentucky may have to close its doors next year. It should be noted that the horse industry in Pennsylvania is so healthy that a brand new racetrack was just built in Erie, Penn. While we contemplate closing racetracks in Kentucky, Pennsylvania is opening brand new facilities.
These are not idle threats or misleading anecdotes. This is the world our horsemen live in right now, and it's only going to get worse until and unless the legislature allows us to compete. And we can compete, because at the end of the day, we have a better product. The Kentucky Thoroughbred is still the most sought-after racehorse in the world. But that, too, is being threatened.
For example, one farm owner told a group recently that he had four stallions for sale at the Keeneland Horses of All Ages auction. The one that brought the highest price, even though it was an inferior animal in his estimation, was Indiana-bred. Now that horse will be moved back to Indiana, where it will command a higher stud fee than it would here because Indiana's breeders' incentive program will soon lap Kentucky in terms of money available.
We're not the banking and financial services industry. We're not the automotive industry. We're not looking for a government bailout. We would simply like the opportunity to create jobs and build facilities that will compete with Indiana, West Virginia, Pennsylvania and all of the other states who want to put us out of business. All we need is authorization from the General Assembly.
In the meantime, more horses will leave the state. More employees will lose their jobs. More may be asked to take pay cuts. More may even be asked to relocate to a competing state. And we are going to quantify it.