INDIANAPOLIS – The push for lawmakers to legalize electronic pull-tabs began early this legislative session – with a summer study committee hearing hours of testimony Monday on the economic impact of Indiana’s equine industry.

Proponents of the slot-like gambling devices hope to use the revenue from the machines to prop up the horse racing industry – specifically by increasing the prize money, or purses.

But they need the General Assembly to authorize placing the machines at two horse tracks and two off-track betting parlors – including one in Fort Wayne. Attempts to do so the past two years have failed, and the next legislative session begins in January.

“It will definitely be a big issue this year,” said Rep. Marlin Stutzman, R-Howe, who attended the meeting as a member of the Interim Study Committee on Agriculture and Small Business Issues.

“I have mixed feelings. I want to see the horse racing industry survive and thrive because it is important for the state’s economy,” he said. “But isn’t there any other alternative than pull-tabs?”

Stutzman and many other legislators view the authorization of pull-tab machines as an expansion of gaming.

The measure inched closer in the 2003 session – even passing the House before stalling in the Senate. That’s because longtime opponent, Sen. Larry Borst, R-Greenwood, once again swayed his caucus against the proposal.

But Borst isn’t around to block the bill this year – he was defeated in the May primary. That has members of the horse racing industry more hopeful than ever.

Kevin McNamara, a professor of agricultural economics at Purdue University, told committee members that horses are economically important to the state. He noted that the county with the largest horse population is LaGrange, with 11,200. Allen County is third with 5,400 horses.

He said most owners use their horses for trail or recreation purposes, while others use them for work or show them in competition. Only 3 percent of the state’s horse operations are for racing.

Jerry Walker, chairman of the Indiana Horse Racing and Breeding Coalition, spoke more specifically about horse racing, saying there were 10,000 racing horses in Indiana in 2001 and the industry accounted for $479 million in total economic value and 6,662 jobs in 2002.

But it still receives a $27 million subsidy from the state to aid its purses. The purse amounts have dropped with the opening of a second track in Shelbyville because that subsidy had to be split.

Walker estimates that if the legislature approves the 5,000 pull-tabs – including 1,500 in Fort Wayne – a mature racing industry would generate $767 million a year with an employment effect of more than 12,000 jobs.

State and local governments would also reap more than $150 million in new tax revenue.

Dr. Larry Smith – a Berne veterinarian and Standard bred owner-breeder – told the committee that appropriate purses are necessary “if we want to tie our hopes and our dreams to this industry.”

He said many Ohio residents are coming to Indiana to buy and race their horses. But with Ohio also considering alternative gaming, he fears all that business could shift across the border if Indiana doesn’t move forward with pull-tabs.

“If the purses continue to drop, we’ll go where the money is or just get out of the business,” he said. “There is a lot of uncertainty right now, and people are nervous about spending money here if there won’t be any purses to win.”
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