Horseshoes or Homeroom in PA?
 

Looks like the slots money is going bye bye in PA.

Proposed legislation would take nearly all of the money from the state's Horse Racing Development Fund and redirect it to school districts that receive less than 35 percent of their funding from the state. Rep. Todd Stephens (R-Montgomery County) said his bill would provide relief for local property taxpayers and address the imbalance in the state's school funding formula.

Stephens' bill would shift $250 million from the development fund to school districts receiving less than average state funding.............

.........What Stephens sees as a potential windfall for school and local taxpayers, the horse industry sees as a death sentence.

"It's gone," said Todd Mostoller, Executive Director of the state Horseman's Benevolent & Protective Association. "(If it passes) there is no industry in Pennsylvania.

http://www.pennlive.com/midstate/ind...cing_scho.html

Addressed on ATR Thursday and active rebuttal of the fraudulent Stephens on his Facebook page led by Chuck. And I suggest reading Matt Hegarty's piece in DRF where it's brought out that Stephens' bill is designed to bring tax relief strictly to the 211 wealthiest districts in Pennsylvania. He couldn't care less about the schools. A similar attack was floated 2 years ago in PA and was rebuffed.

The disgusting element of this particular attack by Stephens and the complicit media in PA is misidentifying beneficiaries of the program as 'wealthy horse owners'. Let's check with the breeders, vets, farriers, backstretch workers, feed merchants, van drivers, et al, and see how wealthy they all are. According to this creep Stephens, 'wealthy horse owners' not OK for alleged government largess, but wealthy homeowners are.

HEGARTY PIECE: http://www.drf.com/news/pennsylvania...ue-250-million

Rep. Todd Stephens of Montgomery County, said that the intent of the bill was to provide property-tax relief to homeowners in 211 school districts that receive less than 35 percent of their funding from the state. Those districts are typically high-income areas where the tax base is wealthy enough to provide the majority of funding for schools.

STEPHENS FACEBOOK: https://www.facebook.com/RepToddStephens

Thanks for flushing out this story. I missed Thursdays show.and didnot see it posted as a topic on DT. Certainly a one sided, incomplete reporting job and weak response by the PA horsemen rep.

http://www.phillymag.com/news/2014/0...money-schools/

Another take

Ugh. Doesn't surprise me. You know how hard it is to be a racefan in the Philadelphia Area? :mad:

Assuming the premise is correct that "racing is the sport of kings" what does that make you? Jester? Prince? Lord? or broke without the 250 mil.

Amazing stupidity...Shiek Mo loves those conditional 5k claiming races..

Steve can you get that guy Stephens to call in so you can let him have it? I'd love to hear his stammering answer.

Yeah I saw him at Penn the other day clocking some PA bred maiden 7500's.

While in no way can the slot money experience in PA be classified as anything other than a continued missed opportunity the idea that the money is simply flowing to the "super rich and elite" is more or less an outright lie.

Makes you wonder where we are as a country when even GOP politicians are using class warfare to take money from private business for their own benefit?

Of course it is a lie, but the money has been so wasted it will be tough to argue for keeping it. Anytime people point to the good things the money could have been used for, all the opponents have to say is "you've had X years" and blew it. I don't know the X, what is it, 5, 10?

LOL...like the public school system never wastes any money. Don't hold your breath waiting for the grades to go up if they do kill the race industry and give the money to schools.

No it is not hard to argue for it at all. The facts are pretty clear, this was a business deal between the tracks, state and horsemen. The money is no more the states money than the money sitting in your twinspsires account would be. What they are doing is simply stealing money from private business. Are you ok with the gov't seizing revenue from private business to use to pander to local voters and further the political careers of the bills writers?

What you probably dont realize is that what they are proposing to fund is already provided for by Act 71. The state has already received billions for school funding and more importantly (because education is a nebulous area where no one really has any idea where the money goes) for property tax relief even in areas that have been served. This is simply a pandering for votes trick that will wipe out an entire industry while further enriching the tracks who are giant gambling corporations making 5 times as much money as the horsemen are. If you wanted additional funds from the gambling industry wouldnt you go after the tracks money being they have a whole lot more than the horsemen AND you'd more or less just be lowering corporate profits while barely affecting jobs and economic impact?

Of course the truth that no one wants to admit is that lobbyists from parx and Penn national are probably the ones who crafted the bill considering they have the most to gain from an elimination of racing.

I said it wrong. Of course it isn't hard to argue for racing getting the money. I just don't think there is a chance in hell they will keep it no matter how hard it is argued or how right the argument is.

Since the state was in on the agreement, why can't they opt to try to change it?

Exactly.

I would say if your track is dependent on slots you better get a backup plan, no way politicians, especially the way the current ways are trending, are going to allow racing to take a big percentage of the casino profits.

While this might have been a self serving case of politics (well they all are) with superficial reasons the next guy is going to wave the "gotta do whats right for the low and middle class", and that argument gets a lot of legislation done, and will be more so in the future.

The state was a third party to the agreement that doesn't actually provide anything. Legally they can change the agreement just as they can change any law but should we feel comfortable with deals like this where an entire industry will be crippled irreparably? The issue certainly isnt that they can do it but should they be allowed to do it without a fight?

Everyone expected racing to eventually take a haircut and in most states huge mistakes have been made in not trying to preempt them by growing handle to better prepare for the inevitable AND use that growth as proof for keeping the funds. However that doesnt mean (regardless of your feelings about the takeout or other ancillary issues in play here) that politicians can just swoop in and take ALL the money that funds a pretty large industry based on lies and bullshit.

What about the people who have bought farms in the state where PA breds suddenly are worthless? What about the farms that grow hay and straw to sell to these other farms and racetracks and training centers? What about the employees of those people? Racing and breeding has a huge economic impact beyond the backstretch that will for the most part go away. The facts are that the 250 million going to racing interests has a far greater impact into the states economic interests than 250 million taken from the tracks. Why doesnt anyone ask why the tracks are exempted from giving money back?

Racing in PA gets 13% of the profits. While you may be correct in saying that politicians will eventually steal the money what backup plan do you propose will replace $250 million a year?

While everyone loves to use the subsidy argument against racing the truth is that many industries are subsidized by the govt between direct cash investments, tax credits, tax holidays, etc

Right, this isn't exactly a surprise. Stevie Wonder could see it coming.

It is pretty sad that the money will supposedly be used to help education, i.e. the lower and middle classes, while at the same time that is exactly where the slots money is coming from in the first place.

In the end, racing is going to have to stand on its own, like it or not. In PA, I doubt they can. I'm not even sure if I hope I'm wrong to be honest. I do know we don't need two almost year round tracks and another that gives out insane purses for poor racing a few months a year.

Um a better product, one that can attract bettors and keep them long term, national legislation that would allow for the entire country to legally bet on line, stuff like that.

Subsidies cannot be the defining way the industry survives, which it sounds like it is for many.

subsidies turn free market principles upside down.

That crowd would point to say agriculture for example but to me that is apples and oranges, you dont need horse racing to eat.

We have all been through this argument before. The response from the tracks has been silence as usual because they are most likely behind the deal and the horsemen for the most part havent done or said anything. In the end the people in the racing industry in PA are going to get run out of business and racing in this state will die. That of course will effect racing everywhere as even idiot politicians in other states have google and will likely try to copy what will be done here. Maryland is already on shaky grounds from rumblings there and you'd have to be an idiot to think that NY racing is not going to get the shaft soon.

Some people have this vision that there will eventually be just a few tracks left that will beam their signal out to the rest of the world. That will never happen because as soon as the tracks can make money and not have to operate, they will eventually all want to be taking the signal, not giving it.

again, what your essentially saying is as a product racing cannot make it because it cannot come close to funding itself.

Why should it not fail if that is the case, why is it up to slots players to prop up the failing business model?

Racing will never be able to stand on its own without significant govt intervention. I told you this 2 years ago and it is more true now than ever.

You have interests hostile to racing operating tracks! You have competition from casinos everywhere. You have govt's bending over backwards to help casino intersts (see Revel in NJ) while actively working against racing.

There will be no racing without help anywhere. It is getting hard to convince people to breed and own horses at the current purse and breeding incentive levels. What do you think you will see with reductions? Contracting industries generally continue to contract till they are no longer relevant.

Yeah I'm sure that they can stimulate a couple billion dollars worth of handle in PA with online betting.

How did they survive before he slots, or did they just open? I dont follow that circuit.......at all.

True horse racing isnt a necessary item. However when combined with casino gambling it does at least create positive benefits other than simple tax revenue especially considering that we are approaching saturation levels with casinos, at least in the East.

Keep in mind Chuck, I have as much of an interest in racing succeeding as you do, and more interest in seeing as many tracks open as possible.

The business model for racing sucks. Costs are way too high for bettors and horsemen alike. Putting on the show could cost a whole lot less than it does now. But you are right, the tracks will die without subsidies. It was blown a long time ago when simulcasting models were implemented, and later when it was carried over to allow third parties to run ADWs and siphon off tons of money.

The whole thing needs to be blown up. There would be a lot of pain involved, but really I don't see any other way. We keep applying patches to a broken game, and eventually it will just die.

Racing can not compete with casino gambling for obvious reasons especially when that casino is placed in direct competition right on top of the racing facility. This was a pretty clear reason why racing was granted these monies in the first place. Surely life will go on in area's where tracks no longer exist but there is without a doubt a economic impact that racing provides that casinos certainly do not.

Even if in states like PA if things had been done in an ideal manner the amount of growth would never keep pace with the amount of money coming from our "partners" in the casino. Lets not forget that the ONLY reason that Parx and Penn have casinos is they were established racing facilities. Now big boys realize that sentiment only lasts so long when so much money is in play but facts are facts.

They were hardly thriving but they had no competition outside of AC before Delaware Park came online. Once that happened they had to get slots or probably close up shop. If you went back to a 1990 world prior to any casinos outside of Vegas and AC, racing might have a chance to turn things around w/o alternate sources of funding. However in the 2014 world that just isnt true.

I may be naive but I dont see people deciding "do I play the ponies or do I play the slots today".......I feel like people seek out poker to play, they seek out horses, or they seek out whatever venture that they enjoy and can survive.

You just have little chance of surviving long term in horse racing. When that changes, if ever, I feel like the sport could grow.

Those in the industry would rather we just look at it as entertainment.

While your assessment is really spot on I just dont see how it is possible.

I have a lot of experience in racing. I worked as a groom as a kid in Saratoga before I was legal to work. Worked in the parking lot at night at Saratoga harness. I went to the U of AZ race track program. I spent 2 years as asst racing secretary at Yonkers. I have moonlighted charting races and punching tickets at various times. I worked for some of the top trainers in the US and have trained, owned and bred horses on my own since 1999. I have been thinking about how to fix the game for 25 years and sadly the more experience in different area's that I got, the more I realized that racing was essentially doomed.

You will never get "racing" to act as a single entity despite the clamor for a commissioner or league office of sorts. There are few businesses in the world where so many different working parts work together while serving different masters with different goals in mind. Self interest is simply too strong of a human flaw to overcome. There are a lot of people who are making a lot of money as racing is currently constructed an despite an awareness that things NEED to change many feel they will just ride it out to the end squeezing every penny they can get before the end comes.

There has been a sense of doom surrounding this business for 100 years if you read the old thoroughbred record news reports from the past so you have to understand that a lot of racing people continue to see it as crying wolf even as Hollywood Park closes and Bay Meadows closes and we have Penn National gaming building "tracks" with zero live mutual clerks. The Feds carted off a couple of trainers on trumped up charges of race fixing yet miracle workers in other area's are still working magic. This is a vision less industry with short term considerations a virtual given.

I see exchage wagering as a potential revelation of sorts but the industry will surely screw it up. At the very least Monmouth has a few guys willing to try different things like sports betting and exchange wagering. Though I suppose once sports betting gets humming the state will surely take it away like they do with slots money right?

I guess when it comes right down to it I know far too may of the industry movers and shakers to have any confidence that they can solve virtually any mundane issue let alone a massive overhaul. I'm old enough to ride it out till the end but anyone who is young and interested in the sport, go to Pat Cummings for advice because the game in this country is in far worse shape than most even realize.

You are thinking too specifically. Gambling is gambling and the proliferation of the availability of casino gambling more or less is choking off many of the potential players of the past.

Funny thing is that your thinking is similar to the reasoning that started racing down the path it has taken. NYRA thought that no one would go to OTB's and not to the tracks in the early 70's. No one thought that the lotteries would hurt handle. Tracks and horsemen didnt think that people would stop betting live races to bet simulcasts in the 90's.

In the end we cant go back and fix those mistakes because in each case the cat is out of the bag and cant be put back in. So yeah we should be using the slot money in a more efficient manner, we should have used more money to try to grow handle and we should have spent more on marketing and lobbyists. But as you have implied as long as the states are needing new revenue sources the slot money will always be in danger.

I hope you are wrong, but I'm not optimistic.

Given the dynamics probably the correct approach?

Not really working, so no. Race betting doesn't draw the type of person that bets lotteries or slots machines. It draws people that like a challenge. The people that are going to bet enough money to matter aren't doing it for entertainment, and they aren't doing it as an aside to watching horses running around in a circle.

Caught only a smidge of the live Friday radio programs first few minutes and didn't quite know what Steve was so fired up about.

This is does not look good for the racing industry.

It is so sad that the public will be misled because to find the truth is going to take some digging; the press is failing at adequately informing the public.

Its a bit of a different discussion for a different place I suppose.

Pa horse board commission or whatever was scheduled to be bankrupt this year according to an article I read a few months back...supposed to fold into the pa gaming commission

Since I got called into the fray...

1. Most horses are born with the instinct to run and compete, no matter where they are born.

2. All horses eat, drink, excrete, sleep, etc. Almost every horse the world over has an owner, and if it is in their interest to keep the horse (for whatever reason), they have to spend resources to maintain the horse. THIS is a massive, and (especially amongst some) wildly under-recognized economic driver. Keep it in mind.

3. Philly.com did a hit piece on racing a few months back, which seems just a prelude to this recent attack. I call it a hit piece because it was, pure and simple. It suggested, and I am not stretching the suggestion, that old ladies were spending their social security checks through penny slots to enrich Saudi princes, and financiers like George Bolton/Paul Reddam, etc, and that was wrong.

4. Here's the original story, from September. It's almost as if this most recent effort to raid racing's "coffers" is a function of someone reading this story. More likely, I'd suggest, it's all part of the same campaign. Read it here - http://www.philly.com/philly/news/Gi..._industry.html

5. It was (and remains) economic sensationalism at its worst, framing the entire industry around the person who owns the horse, with absolutely no reference to the fact that this is the person who also pays the bills, and that trickle down is substantial. The more horses you have, the wider your reach, the MORE people who are paid (read also - the more economic stimulus the sport, essentially the horse, provides to society).

6. Watch this video, the whole thing isn't required, from 2:00 to 4:00. This is Mick Goss, a phenomenal fellow who runs Summerhill Stud in South Africa. Never in my history in the sport have I encountered someone who captured the trickle-down economics of racing any better.

https://www.youtube.com/watch?v=OuwH19fQOCI

"I've always been amazed by the tenacity of our horsemen. We have colleagues who have been known to mortgage their farms in order to pay their stallion fees...

"If racing were simply commerce, Karl Marx should have been its interpreter. As a financial proposition, it is about the redistribution of incomes. It is socialism in a form so subtle you'd hardly notice it. Hundreds of millions of rands (South African $$) are supplied each year by businessmen from Massachusetts to Mooi River, from surgeons and solicitors, gold miners to merchant bankers, and tax avoiders from all over.

The treasure they contribute is then redistributed slowly, little by little each month so it doesn't look too obvious. To jockeys, trainers, vets and farriers, to clairvoyants, chiropractors, and grooms, to bottlers of magic elixirs, feed merchants and float drivers. Eventually, the working class has acquired most of the surplus income of the bourgeois.

When the cycle begins, the horsepeople provide the experience, the owners the cash. When the cycle is complete, the horsepeople have the cash, and the owners have the experience."

7. If the Rep. thinks the sport exists to enrich those who already are a little more, he needs an economics lesson. How good is racing's rebuttal to all of this? We'll see.

8. If anyone wants a look at what racing could become without competitive assistance racinos have provided, take a good look at the purse structure in the UK. To suggest it's terrible is an understatement. Racing in the UK is almost exclusively in the domain of the incredibly wealthy, because there is almost no way to make money. Ryan Goldberg did a great story on this for the International Herald Tribune last year. US racing has done a phenomenal job of making the game significantly affordable for more than just the uber elite.

That's all I have for now.

Governor Tom Corbett is supposed to address increasing spending on education in Pennsylvania today. I hope he doesn't tie his remarks to the proposed raiding of the horse racing revenue or this could get a lot more dire in a hurry. :(

This lunacy has also spread to Forbes:

http://www.forbes.com/sites/taxanaly...s-or-children/