Jersey budget proposal calls for eliminating racing’s subsidy

Jersey budget proposal calls for eliminating racing’s subsidy

August 28, 2020

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The industry has until the end of September to convince legislators to change that decision and keep a subsidy that has been a boon to racing in the state in only its first year.

by Bill Finley

New Jersey governor Phil Murphy unveiled his proposed budget for the state Tuesday (Aug. 25) and it does not include the $20 million subsidy that has been split evenly between the thoroughbred and harness racing industries in the state.

Murphy’s budget included many cuts that are a direct result of the state experiencing a budget deficit because of the pandemic.

Meadowlands owner Jeff Gural said losing the subsidy would be “devastating” for racing in the Garden State, but was one of many who expressed optimism that the subsidy would be included in the final budget. The budget will now be handed off to the legislature, which often makes changes to what has been proposed by the governor. The deadline for passing a budget is Sept. 30.

The subsidy was implemented in 2019 and was seen as a means to help New Jersey racing compete with states where the racing product is fueled by slot machine and casino revenues. New Jersey is the only state in the region that does not get a cut of casino revenue.

The bill that created the subsidy called for a $100 million payout to racing spread over five years. However, it also included a provision whereby the subsidy was subject to an annual review.

Of the funds allocated to the standardbred industry, 60 per cent was allocated to Meadowlands overnight purses, 16 per cent to Freehold overnight purses, 12 per cent to the New Jersey Sire Stakes purses, six per cent to purse bonuses for New Jersey sired horses, and six per cent for breeders awards purses.

“With this funding, New Jersey can continue to offer one of the most exciting horse racing experiences in the nation, while also providing a boost to an industry that is integral to our economy,” Murphy said when signing the original bill.

Murphy’s predictions came true as the subsidy helped revitalize the Meadowlands, which, once again, was able to offer purses that were competitive with tracks in slot states such as Pennsylvania and New York. It did the same for thoroughbred racing at Monmouth Park.

To not have that money available would no doubt be a serious setback for New Jersey racing.

“This could be devastating for our industry,” Gural said. “It would be just horrible to lose this. In harness racing, it has been a success, especially on the breeding side. All the numbers in New Jersey, the stallions, the mares bred, have gone way up. It accomplished what we said it would accomplish. This is a by-product of COVID-19. We were not blindsided by this, but we were still hoping they would include it in the budget. The good thing is we have until the end of September to get them to change their minds.”

Following the news of the budget, the Standardbred Breeders and Owners Association of New Jersey (SBOANJ) issued a statement from A. J. Sabath, who advises the organization on government affairs. Sabath also voiced his confidence that the $20 million could yet be included in the final budget.

“Yesterday, the governor proposed what he wanted the budget to look like from his vantage point. I want to reassure you that this is only the beginning of the budget process,” the statement read. “The budget is now in the hands of the legislature. Between now and the September 30th budget deadline, the legislature will be negotiating their own budget with the governor. Legislative leaders have their own budget priorities with the power to add and remove what is in the final budget. This is not the time to be discouraged that the $20 million for purse appropriation was not in the proposed budget. We need to keep advocating for our industry. The foundation of our years of advocacy has made it clear to policy makers that our industry is part of the fabric of what makes New Jersey the state it is in the Union.”

Gural said it is important for anyone involved in New Jersey racing to reach out to their legislators to let them know how vital the subsidy is to the industry.

“It’s not a done deal but it certainly is important that anyone living in New Jersey who has any contacts with the legislature do their part,” he said. “It’s really up to the legislature to restore the money. People have to reach out to them and make the argument that this has been worth the money. The state will lose more without the subsidy than with the subsidy because of all the jobs that will be lost. Tell them how important this subsidy is and how many jobs will be lost if it goes away. It would devastate the industry.”

As much as the subsidy has done for the racing product, its biggest impact has been in the breeding industry. As late as 2018, the number of stallions in the state had dwindled to a precious few. The SBOANJ website now lists 16 sires in the state, including top names like Muscle Hill, Walner, Tactical Landing and Bettor’s Wish.

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