NJ Budget Proposal Nixes Horse Racing Purse Subsidy As Part Of Covid Cuts

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As would be expected, New Jersey Gov. Phil Murphy’s $32.4 billion budget proposal announced on Tuesday includes countless spending cuts to try to counteract the loss of revenue due to the impact of the COVID-19 pandemic.

There is a cut of a $71.3 million state subsidy toward New Jersey Transit, along with many trims in the $5 million to $25 million range.

Among those is a $20 million cut from an annual horse racing purse subsidy that was signed into law in February 2019. That money was to be split each year equally between the thoroughbred horsemen at Monmouth Park and the harness racing communities of Meadowlands Racetrack and Freehold Raceway.

The subsidy is a mere fraction of the hundreds of millions in slot machine revenue subsidies allocated to racetracks in New York and Pennsylvania, but it has helped the bottom line of all three tracks in both 2019 and 2020.

But what’s next?

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“I think it’s premature to comment, really,” Dennis Drazin, who operates Monmouth Park for the state’s thoroughbred horsemen, told njonlinegambling.com Wednesday.
“What this means is that we will have to continue to press for it to continue,” Drazin added.

Still time for a budget revise

The budget will not be finalized until the end of September, and no doubt there will be many negotiations in the form of — well, horse trading — in the virtual version of the Trenton statehouse in the weeks to come.
The compromise reached when the bill originally was passed was for five years and $100 million to the industry, but only via an annual review in which the horsemen would need to provide tangible proof that the subsidy was having a beneficial effect.
The racetracks indeed had improved bottom lines before the pandemic hit, with larger purses leading to larger race fields — which led to increased “handle,” or amount wagered. The 2020 subsidy already has been paid, so there is no immediate impact on the state’s horse racing industry.
The subsidy bill and then law did not appear as part of a preliminary Gov. Murphy budget, nor was it part of the final budget passed in mid-2019. So if conditions improve by next spring, it’s possible the subsidy plan could be revived.
The current law sends the $10 million to the harness racing, or standardbred, side in differing increments.
The Meadowlands purses claim $6 million, another $1.6 million goes to Freehold purses, and there is also $1.2 million to New Jersey Sire Stakes purses and $600,000 each to purse bonuses for New Jersey-sired horses and for breeders award purses.

Freehold resumes its harness racing schedule this weekend, after having been off since early March — about half of which was previously scheduled as dormant anyway. The track will now feature races — so far, with limited attendance — until the end of the year.

The Meadowlands schedule peaked with The Hambletonian card on Aug. 8, with a three-week break ending on Sept. 5, which also happens to the the amended date for the Kentucky Derby. That track also will continue on weekends for the rest of 2020.

Monmouth Park is continuing to offer races on Fridays, Saturdays, and Sundays until its season concludes on Sept. 27.

Horsemen to get paid in spite of drug lab’s tardiness

The state Thoroughbred Horsemen’s Association was given the green light Monday to guarantee $7 million in purse money earned at Monmouth Park races this summer, but which has been delayed by a state-approved laboratory’s failure to return drug testing results for horses that raced as long as six weeks ago.

The same lab had similar issues last summer, creating uncertainty in the minds of bettors over which horses were clean.

Photo provided by Shutterstock

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John Brennan

John Brennan has covered NJ and NY sports business and gaming since 2002 and was a Pulitzer Prize Finalist in 2008, while reporting for The Bergen County Record.

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