Horse industry has no short-term strategy to pass slots bill
By Janet Patton and Beth Musgrave – jpatton@herald-leader.com
Kentucky’s horse industry, which bet heavily on a Democratic win in Tuesday’s special state Senate election, wasn’t prepared for defeat and doesn’t have a short-term plan to advance legislation that would allow slots at racetracks, industry leaders say.
“We didn’t plan on losing, so we don’t have a strategy other than we want to attempt to continue to have our voices heard,” said Ric Waldman, a bloodstock consultant who is one of the directors of the issues group Keep Our Jobs in Kentucky Inc.
The horse industry group spent hundreds of thousand of dollars on advertising that opposed Republican Jimmy Higdon and supported Democrat Jodie Haydon. Haydon’s election had been seen as critical to the horse industry’s efforts to get casino-style gambling, but he lost by a wide margin.
On Wednesday, Senate Majority Leader Robert Stivers, R-Manchester, said the fate of expanded gambling is in the hands of Democratic Gov. Steve Beshear.
Stivers said the horse industry has spent a lot of money trying to change the political power structure in the Senate. After two very expensive elections, the Republicans remain in power by a 20-17 margin, with one independent who generally sides with Republicans.
“If they spent the $1.9 million dollars that we’ve heard that they’ve spent, I feel that they were not very good at spending their money,” Stivers said. “Maybe they are not in as bad as shape as they claim to be if they can spend basically $2 million on an election.”
The non-profit Keep Our Jobs in Kentucky Inc. does not have to disclose its donors or expenses until it files a tax return early next year.
Beshear, in a statement, said he continues to support electronic slot machine legislation but he did not say whether a specific bill will be forthcoming.
“All options are on the table, and helping the horse industry survive is a top priority, but we are still developing our legislative strategy for next year,” Beshear said.
House Speaker Greg Stumbo, who sponsored a slots bill in a special legislative session this summer that died in a Senate committee, said he thinks the 2010 elections will be pivotal.
But he doesn’t see taking slots legislation up again unless the full Senate can vote on the issue.
“Until things change over in the Senate, I don’t see why the House would want to consider it,” said Stumbo, D-Prestonsburg.
Based on voter interest, “I still hold some hope out that the Senate leadership will change its mind. … With the full election cycle coming up, they might want to put this issue behind them, one way or the other,” he said.
With Higdon’s election, there appears little prospect of toppling Senate President David Williams, R-Burkesville, who opposes any move to expand gambling, before the November 2010 elections.
The odds of getting a slots bill through the upcoming session of the General Assembly appear exceedingly long with Williams in power, said Bill Farish of Lane’s End Farm. Instead, he said industry leaders will focus on next year, especially on recruiting Republican candidates that support slots.
Farish, a Republican who has been a vocal critic of Williams, said Tuesday’s election “absolutely” is a setback for the horse industry. “It’s very very hard to move the ball right now (on expanded gambling). We have no choice but to keep trying,” he said.
Horse breeders and racetracks have already said they need help now, but Wednesday they weren’t able to offer any new alternatives.
They have rejected the only bill currently filed, a proposed constitutional amendment by Sen. Damon Thayer, R-Georgetown, as “too little too late.”
Jay Blanton, spokesman for Keeneland, said sentiment on a constitutional amendment, which must win approval from voters, has not changed. “It doesn’t provide the kind of immediate, near-term relief the industry needs,” Blanton said.
“We still prefer the statutory approach,” said John Asher, Churchill Downs spokesman, referring to Stumbo’s bill, which didn’t require a constitutional amendment.
“We look forward to educating lawmakers about the reality of the crisis that faces Kentucky’s signature industry,” Asher said. “The industry’s certainly open to talking with lawmakers and seeing what their ideas are. What those might be, I couldn’t say at this point.”
Stivers said Senate Republicans are interested in finding solutions to help the ailing horse industry. And they are willing to work with Beshear — despite his attempts to thin Republican ranks in the Senate — to find those solutions, Stivers said.
“The majority of the members of the General Assembly want to make sure the horse industry stays strong as it does provide a lot of jobs,” Stivers said.
Beshear on Wednesday said a constitutional amendment would be a significant delay.
“This is simply another stalling tactic that will cost our state jobs and revenue,” he said. “Senator Thayer’s bill would require two layers of delays — one statewide vote on the amendment, and then if that passes, a series of second votes among the counties pursing expanded gaming. It’s time we can’t afford to waste.”
About the Author: John Stamper is the accountability editor for the Lexington Herald-Leader. A native of Monticello, Ky., he has been with the Herald-Leader in a variety of roles since graduating from Western Kentucky University in 2000. Reach him at jstamper@herald-leader.com
Value Imposed | Dec 9, 2009 | Reply
Oh please, daddy conservatives, please oh please can I drink, smoke, worship and gamble like I want to. Oh please, oh please.
Nothing like a bunch of righteous individuals imposing their values on the rest of us!!!
zed | Dec 9, 2009 | Reply
Several years ago, I attended a farm managers meeting that former Gov. Jones spoke at. He asked all of us to raise our hands if they knew the name of their state representative and or Congressman. A few hands in the crowd of over 100 went up. I’m ashamed to say I didn’t know mine. That in a nutshell is the biggest problem of the industry. Ignorance.
We were the largest agricultural product by sales volume until overtaken by chickens. Unlike any other farmer, pig, cow, wheat, corn, Alpacas, horse farms pay sales tax on feed, fencing, fuels, and a whole host of items that other farms, some right next door don’t. We haven’t been organized and we have been that way until recently. These are small setbacks.
The issue is a very small and narrow one for the horse industry. An owner of horse bred in Kentucky but born in PA, can run that horse at Philly Park in the very bottom of the claiming ladder $8500 claiming price for a purse of 24k. That very same race featuring KY bred horses from the same stallion and maybe even from the same mare will run at Churchill for a purse of no more than $12,500. If we win at Churchill, our gross is $7500 if we win at Philly, we gross$ 14,400! 1900 dollars more than the entire purse in Kentucky. Because it was a PA bred and we still own it, we get an additional 4300 dollars from the PA Breeding fund. For a claimer bred in Kentucky by the same stallion and out of the same mare, we get zero. Only allowance and stakes horses need apply. So for our cheap claimer in PA (by a KY stallion no less) we get 18,800 dollars. For are MADE AND RACED IN KENTUCKY we get $7500 Just do the math. This isn’t rocket science. Its all because of slots. By any hook or crook, make the purses level with our sister states, and you put a cork in the draining of the industry from the Commonwealth. Slots are the consumate fools game. Monkeys have the same level of “luck” as the most highly skilled slots player. But it puts us on a level field. If you want to give most of it to special ed, unspecial ed, or the first born of race track executives, that’s fine, just give us a portion to balance the purse levels. We don’t really need to have a state bribe to breed the best to the best.
PS. I forgot to add, Kentucky has the best farms, the best horses, the best medical, the best personnel and its all within 20 miles of each other. No other place should be able to compete. But do we ever make our brand, “KY Bred” special?
No.
steve | Dec 9, 2009 | Reply
Folks,
The horse industry (basically CD) has allowed their industry to evolve into a two day race meet in KY. CD doesn’t give two hoots in hell about the Ky race player given how they are treated outside the Oaks and Derby. CD has evolved into a corporate entity that caters to the corporate world that comes to their track two days a year. This horse player did not bet one dollar at their track the last two years and doubt I will darken their doors again in the future. CD needs to go to Keeneland at watch how a real recetrack is run and stop the crying about slots.
I want casino gambling in Kentucky but not at the racetracks who will just use it as a subsidy for horses.
Build Casinos in the state and let us enjoy all gaming not just the kind CD want us to have.
PS If you think Harrah’s would be scared by a competitor the likes of CD I think you would have another thing coming.
Buck Feshear | Dec 9, 2009 | Reply
“We didn’t plan on losing so we don’t have a strategy…”
That, folks, is priceless and if the horse industry is in as dire straits as it claims to be — which I doubt seriously — this is exactly the reason why. There’s no looking forward, no planning, no business plan or model outside a gimmick or subsidy to prop it up.
I can give you a very simple strategy. Put a marketable product out there. Put on a show that people will want to attend and watch on TV. There’s a reason that people prefer auto racing to horse racing, or basketball or football to hockey and soccer. Tap into that, find out why, and use it to your advantage. Don’t ask the state or the taxpayers to prop you up if you are not innovative and creative enough to solve your own problems.
Bob | Dec 9, 2009 | Reply
This time 12 months ago, the Democratic Party in Kentucky was recovering from going zero for three in attempts to switch senate seats. They put up Kathy Groob, Steve Newberry, and Carroll Hubbard, and all three got their butts kicked.
The Party then proceeded to pick itself up, dust itself off, and go back this year. In a non-election year, they have gone from zero for three to two out of three.
Like Meatloaf sez, that ain’t bad.
We’ll see you next year. From Paducah to Lexington to Shepherdsville to Louisville: we’ll be back.
Threelinks1 | Dec 9, 2009 | Reply
The horse industry has destroyed itself. Don’t blame it on the Republicans.
Mr. Farish is a close friend of George W. Bush. Nuff said.
Conservative principles work. Produce a competitive product and it will sell. Don’t ask me to bail you out by throwing money away on slot machines. That is just bad business.
CSI | Dec 10, 2009 | Reply
Zed,
Lets say Casino gambling comes to Ky. We raise the purse’s to levels competitive or above to the surrounding states and Pennsylvania.
Then those states again raise their purses above ours. What do we do then? What do you do then? Will you show loyalty to Kentucky’s citizens and stay here or will you come back and ask us to raise the purses yet again? Will this cycle ever stop?
Just like newspapers, horsey industry is a dying business model unless you do as other commenters suggested above. Make it more entertaining for customers to attend your venues.
jim | Dec 10, 2009 | Reply
It won’t be long before the “slots” business will be expanded to full blown casinos. That will bring huge monies !
Why should that all go to the “hoarse industry” ?
Don’t let political cronies and contributions get this money grab.
The “slot, etc.” rights should go to the highest bidder. The state can then tax the revenues and give some of that to the horse industry.
THINK EVERYONE !
Fourdognight | Dec 10, 2009 | Reply
This was not a well run campaign on the Democratic side. The Republicans had a local candidate that fit the district.
It will clearly be a harder road now. The thoroughbred industry in the Commonwealth will get smaller. More farmland will be turned into tract homes. At least the industry is politically active now, so perhaps some headway can be made on making the expenses of horse farms have the same tax treatment as other agricultural enterprises.
jim | Dec 10, 2009 | Reply
reply to Fourdognight .
Same tax treatment such as paying sales tax on the horse sales ?
(I can name many more exemptions , if needed)
Fourdognight | Dec 10, 2009 | Reply
reply to jim
Sales of cattle, sheep, hogs, etc are also exempt from sales tax. What is your point?
FourCats | Dec 10, 2009 | Reply
There is no “horse industry”. There are only track owners (who look out only for themselves and seem to care little for racing itself), horsemen (who own, train or breed the horses but have almost no control in their revenue [purses/sales] or costs), fans (who only care about takeout and their next pick and not about making the sport vibrant), the racing media (which complains a lot about other racing participants but doesn’t offer any solutions) and, worst of all, state politicians (who care nothing about horse racing except as a cash cow). Kentucky racing (as well as states such as California and New York) is following the same path now as Maryland which is only a shadow of its former self and where racing is almost extinct. This is a great sport but a central organization (with authority to act) is badly needed to coordinate marketing, integrity and exciting races. But this will never happen as the primary control is with the states and track owners. Oh, and slots? The idea that slots is anything but a short-term bandage is foolish. I am not against slots at all, but they are not horse racing and will not fix it.
Big Ben 4 liberty | Dec 10, 2009 | Reply
I agree with the others that the horse industry needs to stop looki9ng for political gimmicks to save itself and start figuring out how to offer a better product. Frankly I just have no interest in it, and therein lies the problem for the horse industry. More people feel like I do about it and they don’t seem to care. That is why they are in trouble. They are not offering something that appeals to a broader group of consumers rather than the stereotypical lounge lizards who bet on the ponies while drinking their tequila.
However, if they were to take our advice, I’m not sure how they could improve their product. Maybe they could try offering some Tijuana style donkey shows, only with horse instead of donkeys. They could just ask much of their workforce how to administer it, since they would rather hire cheap illegal labor from Mexico than actual Americans.
Buck Feshear | Dec 10, 2009 | Reply
I, too, have wondered how many of these jobs that Beshear says he is so gung-ho on protecting are held by illegal aliens instead of legal immigrants or citizen.