Even before impending purse cuts were reported for the upcoming winter meets at Santa Anita and Golden Gate Fields – the two Stronach Group-owned racetracks in California, the latter of which is slated to close for good in June – there has been no small amount of brainstorming over how the racing economics in the Golden State can be improved.
One idea, following the philosophy of Willie Sutton, was to go where the money is – in this case, Kentucky. The Bluegrass State's racing industry is rolling in clover, thanks to the Kentucky Thoroughbred Development Fund enriched by historical horse racing machines that are now scattered throughout the commonwealth at racetracks and satellite facilities. Millions of dollars in KTDF money has elevated purses for Kentucky-breds to unprecedented levels, and the best is yet to come. The philosophy for KTDF purse enhancements is to incentivize owners to buy Kentucky-breds to race in Kentucky.
Maiden and allowance purses for Kentucky-breds are north of $100,000 at some Kentucky tracks, and stakes purses have also soared. By comparison, maiden special weight races will be reduced from $67,000 to $65,000 at Santa Anita this winter and from $30,000 to $22,500 at Golden Gate, according to published reports.
Historically, Californians have been among the leading buyers at sales of Kentucky-breds, with many of the purchases going west to race. If purses decline further, that pool of buyers could dry up, affecting the pocketbooks of Kentucky breeders.
That is why some horsepeople both in California and Kentucky have asked if KTDF dollars can be used to incentivize owners to buy Kentucky-breds to race in other states, including California, with purse enhancements from that fund. The money is disbursed by the Kentucky Racing Commission.
For starters, that wouldn't be legal, according to Kentucky state Sen. Damon Thayer, a longtime Thoroughbred industry executive and racing and breeding advocate who serves as the Senate Majority Floor Leader in Frankfort.
Thayer said the statute for the Kentucky Thoroughbred Development Fund is set up to reward buyers of Kentucky-breds to race at Kentucky tracks. Period.
“I seriously doubt legislators in Kentucky would have an appetite to change the law and allow that money to be used in other states,” Thayer said.
Even if evidence showed how much out-of-state buyers spend on Kentucky-breds?
“I think that's going to be a very difficult sell,” he said. “The racing and breeding industry has had an exceptional three years with four major bills becoming law, and there's a little bit of fatigue right now in tackling any other big racing and breeding issues.
“Everything is working really well, and we just need to focus on staying the course that we've established with HHR, the tax bill, sports betting at the racetracks, and the bill banning the gray games (unlicensed slots-like machines at bars, restaurants, truck stops, and gas stations),” said Thayer. “Those were huge victories for racing and breeding between 2021, '22 and '23. I just don't see an appetite, for example, for letting Kentucky money be offered for races in California.”
Can Kentucky racing be too successful at the expense of other states?
“I don't have that concern,” Thayer said. “I want Kentucky racing to be as successful as it can be. I still think there is more blue sky ahead for the Kentucky horse industry. We're still in the introductory phase of HHR, so I think there is plenty of upside there, with more facilities to open. Sports betting at the tracks just began and I hope the racetracks use it as an opportunity to do some cross-marketing to get sports bettors to sample all of our pari-mutuel products.
“The job for the Kentucky legislature is to make sure the environment is right for Kentucky racing and breeding to thrive,” he said. “I don't think that's our job for other states. That's the job of legislatures in other states. The racetracks, the horsemen, and the breed groups in other states should look at what's happened in Kentucky as a blueprint for what can happen for them.”
Easier said than done. Kentucky's horse industry doesn't have a casin0-enriched Native American lobby in the state capitol like California does, working to squash any competition for gambling dollars.
Thayer said he recognizes that it's important for other states to succeed in order for Kentucky to succeed, listing Arkansas, Indiana, New York, Virginia, Louisiana, and Ohio among the states doing well thanks to revenue from slots, casinos, or HHR.
“There are some states in distress; I recognize that,” he said. “But it would be very difficult to convince the Kentucky legislature that it's our job to help save racing in California.”
In other words, California racing will have to save itself – not an easy task.
That's my view from the eighth pole.
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