WHEREAS, there have been discussions, though no firm commitments, on other funding sources to address purse viability and to ensure a strong and stable horse racing and breeding industry; and

 WHEREAS, some entities that have obtained licenses to operate off-track wagering facilities have made no progress toward establishing and opening these facilities; and

 WHEREAS, several pieces of legislation have been introduced to infuse the racing and equine breeding industry with new funding through, among other items, permitting sports wagering at racetracks; allowing entities other than the New Jersey Sports and Exposition Authority to operate off-track wagering facilities; authorizing exchange wagering on in-state and out-of-state horse races; allowing racetrack permit holders to provide for a single pari-mutuel pool for each running or harness horse race; infusing the equine breeding industry with $10 million in new funding; and dedicating revenues derived from certain sales and uses subject to sales and use tax to provide enhanced incentives for breeding and development of certain classes of racehorses in this State; and

 WHEREAS, our neighbors, including New York, Pennsylvania, Delaware and Ontario, Canada, currently provide for the use of slot machines, video lottery terminals (VLTs) or complete casino gaming in connection with the racing industry, with a portion of those revenues used to supplement purses at tracks in those jurisdictions; and

 WHEREAS, the value of the Pennsylvania Sire Stakes and breeding development programs has increased to $15 million, and similar programs in New York are now valued in excess of $18 million; and

 WHEREAS, patrons of New Jersey’s racetracks are rapidly exiting the state in order to take advantage of the casino opportunities that are available in neighboring states in addition to the traditional raceway wagers; and

 WHEREAS, the loss of patrons has a direct effect on the racing industry, resulting in a reduction in the amount of wagers placed at New Jersey racetracks, thereby causing uncompetitive purse awards; and

 WHEREAS, higher purse awards made possible by casino gaming in neighboring states encourage racing participants to move to those states, putting New Jersey’s racing and breeding operations at a competitive disadvantage; and

 WHEREAS, the loss of breeding horses, and consequently breeding farms, in New Jersey will result in a net loss of land devoted to agricultural activity, depriving citizens of productive and scenic open space, and will harm the related businesses and industries that depend on a robust equine sector; and

 WHEREAS, the horse industry contributes $1.1 billion annually to New Jersey’s economy and that, of the 42,500 horses in the state, 12,500, or nearly 30 percent, are involved in racing- and breeding-related activities, while the state’s four racing venues contribute $502 million annually to the state’s economy, according to a report released by the Rutgers Equine Science Center.

 NOW, THEREFORE, BE IT RESOLVED, that we, the delegates to the 96^th State Agricultural Convention, assembled in Cherry Hill, New Jersey, on February 8-9, 2011, urge the New Jersey Legislature to continue funding to the New Jersey racing industry until the industry is able to develop sufficient strategies, including the continued build-out of off-track betting facilities and new forms of wagering, to support the current purse structure and breeding incentives.

 BE IT FURTHER RESOLVED, that we urge the appropriate officials and agencies to establish and enforce a “use it or lose it” provision for off-track wagering facility licenses that sets a firm timeline in which progress in establishing and opening those facilities must be met in order for the holder of the license to avoid forfeiting it.

 BE IT FURTHER RESOLVED, that we urge the Legislature to approve, and the Governor to sign, the legislation permitting sports wagering at racetracks; allowing entities other than the New Jersey Sports and Exposition Authority to operate off-track wagering facilities; authorizing exchange wagering on in-state and out-of-state horse races; allowing racetrack permit holders to provide for a single pari-mutuel pool for each running or harness horse race; infusing the equine breeding industry with $10 million in new funding; and dedicating revenues derived from certain sales and uses subject to sales and use tax to provide enhanced incentives for breeding and development of certain classes of racehorses in this State.
 

Racing and Breeding Industry – Reinvigorating Equine

BACKGROUND

New Jersey’s horseracing industry has faced severe challenges recently, especially as the addition of new gaming options at racetracks in neighboring states have dramatically increased the purses being offered for races in Pennsylvania, New York, Delaware and other nearby locales.

This vastly increased competition has been exacerbated by New Jersey’s reluctance to add similar new gaming options at its racetracks for fear of impacting the business of Atlantic City casinos. Interim solutions involving the casino companies providing racetrack “purse subsidies” had helped horseracing venues for a while, but even those fell out of favor in the past several years as the prolonged economic recession cut into casino revenues.

Typically, horse-breeding operations will locate in the states offering higher purses, as horses often must be bred in those states in order to qualify for specific purses or breeding awards. This loss of breeding operations in New Jersey results in severe impacts to the amount of working agricultural land, setting the stage for the owners of those lands to sell them to developers and thus impacting the quality of life for all New Jerseyans.

Additionally, the continued decline of the horseracing industry, which accounts for 30 percent of the total equine industry in New Jersey, will drastically reduce the $1.1 billion contribution of the overall equine industry to the state’s annual economy.

The horseracing industry is encouraged by the ongoing discussions involving the Legislature and the Administration toward finding new ways for the sport to become more self-sufficient, including new types of wagers, stepped-up creation of off-track wagering facilities and dedication of revenues toward spurring the breeding industry.