A Crucial Moment Looms For NJ Horse Racing Subsidy Bill And Tracks’ Fates

Operators at Monmouth Park and Meadowlands Racetrack and elected officials present varying levels of optimism about a key $20M subsidy bill.
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New Jersey state Senate and Assembly members each have now posted parallel bills that would offer a $20 million annual subsidy for the state’s horse racing industry.

“I’m optimistic,” Monmouth Park operator Dennis Drazin told NJ Online Gambling. “I think it will happen.”

But Meadowlands Racetrack operator Jeff Gural told us that he had hoped to see a vote on the bill last week, “so I have no idea what is going to happen.”

There are sound reasons for each sentiment.

Over the past decade, the state Legislature has tended to look kindly on bills that offer support to the horse racing industry or the Atlantic City casinos — or both, in the marathon sports betting legalization battle won by the state at the U.S. Supreme Court in May.

That support also has been bipartisan. The state Senate’s bill includes Democratic sponsors Paul Sarlo of Bergen County and Vin Gopal of Monmouth — looking out for their home track’s interests — as well as Republican Steven Oroho, who represents some northwest New Jersey territory that includes horse farms.

The Assembly version includes three Democratic sponsors from the southern part of the state as well as Republican Ronald Dancer, the son of legendary harness racing driver Stanley Dancer, who was the only horseman to drive and train three Triple Crown winners.

On a fast track?

Assemblyman John Burzichelli, a sponsor of the bill, told NJ Online Gambling that he is “waiting for direction from leadership” on how to proceed with the bill. He said that while most bills first go through a committee hearing and then go to the Appropriations Committee, it’s possible that this one could simply go straight through to the latter.

“We want this to go through because it’s important to the industry,” Burzichelli said.

Both state Senate President Stephen Sweeney and Governor Phil Murphy — both Democrats, as is the majority in the Senate and Assembly — reportedly are on board with the proposal.

So it’s a slam dunk, right?

Not so fast. This concept has been backed by Gural and Drazin all year, and there had been talk about passing something in the Legislature at the end of June, before its two-month break.

That’s a hectic time of year for elected officials, and some bills and proposals get left by the wayside.

Assessing appropriateness of the appropriation

This bill would make a supplemental appropriation from the State’s General Fund to the state Racing Commission, at $20 million annually for five years.

“The only roadblock I see is the state’s overall fiscal health,” said Burzichelli, referring to a massive pension funding shortfall that continues to grow.

When this bill does come up for discussion, there may be lawmakers who have their own pet projects who wonder why their project can’t get this sort of money appropriated.

One other issue could be a perception that new sports betting revenue generated at the tracks would provide enough money to make this subsidy unnecessary — an idea Gural adamantly disputes.

The state’s thoroughbred and standardbred industries generally set up their plans for the following year in the fall, with Drazin saying that his dates are due in two weeks.

Gural said that without the money, he would have to dramatically reduce his dates next year, which he said would be “very disappointing.”

In fact, without aid from the state, Gural makes no longterm guarantees about the fate of his Meadowlands track.

A tale of two tracks

A scenario without financial aid could have dire consequences for North American harness racing. The Meadowlands became the leading harness racing track almost from the day it opened in 1976, and it still has an iconic reputation. That’s even as tracks in neighboring New York in Pennsylvania — fueled by purse subsidies in the form of a fraction of slot machines revenues at their tracks — enable those tracks to lure more and more horsemen away every year.

If the Meadowlands were to shut down, it could lead legislators in other states to rethink their willingness to subsdize their state’s racetracks.

Drazin takes the opposite tack, vowing that Monmouth Park will remain open “forever.” He said he is about to start examining what he would do with his half-share of the $20 million, balancing options such as expanded race dates, higher purses across the board, perhaps investing in a high-stakes meet, and determining how many dates he would seek to race the thoroughbreds at the Meadowlands.

“There are a lot of ways to think about it,” Drazin said.

On the harness racing side, the Meadowlands would get $6 million annually for purses, and Freehold Raceway — the state’s other racetrack — would get $1.6 million. The rest would go to three programs designed to encourage the preservation of horse farms in the state in part by offering bonuses to horses produced by New Jersey stallions.

Should this bill languish this month, Gural is liable to announce a reduced 2019 race calendar that might create waves in the harness racing industry. But would that galvanize state lawmakers?

There is not yet any obvious way to bet on this one.

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