Issue Briefer
An Indiana Tradition:
The horse industry in Indiana has a long and proud tradition, a tradition that helps support the state's recreation, agriculture, commerce and economic development sectors.
Through horse ownership and accompanying ancillary economic development, the horse industry touches every one of Indiana's 92 counties. In cities and towns throughout the state, horse owners help support local businesses that supply the goods and services they need - such as farmers, breeders, boarders, trainers, veterinarians, blacksmiths, tack and harness shops, truck and trailer sales, feed stores, carriage sale and repair businesses and construction and land contractors. These agri-businesses, in turn, produce vital employment opportunities all over Indiana.
Economic Impact:
Economic impact studies show:Horse Racing in Indiana:
- The horse industry in Indiana is a large and important part of our state and local economies, producing an estimated $2.6 billion impact in 2001.
- In 2001 there were 160,000 horses in the state, of which 10,218 were involved in racing.
- The total annual impact on the economy of the state of Indiana from horse racing in 2001 was $479,224,200.
- This is an increase of 268 percent over the $129,860,556 figure reported in a 1999 study.
- Of the 14,368 direct jobs provided by the horse industry in 2001, 3,515 were from racing.
- It is estimated that a mature racing industry in Indiana will add an additional $288 million for a total annual economic impact from racing of $767 million.
Horse racing is the most visible manifestation of the growing Indiana horse industry. From the earliest days of private races on country roads, to county fair contests, to modern pari-mutuel racing at the state's two exciting horse tracks and off-track facilities, raising and racing horses have always been a part of Indiana life. But before Indiana's first pari-mutuel track opened in 1994, in-state racing opportunities were limited to the county fairs. Accordingly, the Indiana horse industry grew slowly and lagged behind that of neighboring states.
The Indiana General Assembly created the impetus for a thriving horse industry in the passage of pari-mutuel wagering legislation in 1989. Riverboat casino gaming, with its accompanying horse racing subsidy, was enacted in 1993 to "help distribute gaming revenue to assist the growth of the horse racing industry in Indiana. Sixty-five cents of each $3.00 riverboat admission tax collected goes to the Indiana Horse Racing Commission to help support the horse racing industry. Currently, 40% of this subsidy is allocated to purses, 40% to racetracks, and 20% to support breed development in Indiana.
Investing in the horse industry, and horse racing, in particular, has proven to be a sound financial investment for the State of Indiana. In 2001, horse racing returned $479 million to the economy of the state while providing 3,515 direct jobs, all from just a $26.8 million investment from the riverboat subsidy. This represents a greater than 17-fold return on the State's investment.
The Next Step in Bringing Home a Winner:
The horse industry can be compared to a growing plant with deep roots in the Indiana economy. Racing is the portion of the plant visible above the ground. A thriving purse structure strengthens the state's horse racing, but it also permeates and nourishes the vast root system supporting the overall horse industry in Indiana.
The horse industry has flourished as an important agribusiness because the Indiana General Assembly created a nurturing environment for horse racing in the state. Hoosier participation in racing has grown as a result of the legislature's vision in subsidizing the purse structure of a fledgling industry and a variety of economic development benefits have flowed throughout the state.
Nevertheless, it is time for the industry to sustain itself. The Indiana horse racing industry must be competitive on a regional and national basis if it is to thrive and yield additional fruits from the state's past investment. Racing can thrive in Indiana if the state's pari-mutuel facilities and its horse industry are allowed to compete on a playing field that accurately reflects current and emerging regional economic realities.
Alternative Gaming:
Alternative gaming at racetracks and satellite facilities can be an effective way for horse racing to compete and become self-sustaining. Initial results have been encouraging in Iowa, West Virginia, Louisiana, Delaware and Canadian provinces in which alternative gaming legislation has been enacted.
Many states, including all of Indiana's neighboring states, are considering this approach. States that have adopted alternative gaming have demonstrated increases in the quality of their racing and improved breed development programs, drawing racing talent, and dollars, from those states whose racing programs remain noncompetitive with other forms of gaming. The earliest states passing alternative gaming legislation will have a decided advantage over the others. In order for Indiana horse racing to bring home a winner, it must be competitive with regional and national racetracks.
Horse Industry Proposal: Bringing Home a Billion Dollar Winner to Indiana
The Indiana Horse Racing and Breeding Coalition supports a proposal that would allow alternative gaming at racetracks and satellite facilities.
- The Coalition proposal places prudent controls on the growth of gaming, actually reducing the number of pari-mutuel locations. Under current law, each track license holder is allowed four off-track betting facilities. Under the Coalition proposal, the total number of off-track facilities would be reduced from eight to six. Each license holder would be allowed two independent facilities and they would share two other locations.
- The Coalition proposal generates significant additional state and local tax revenues. We propose that the current riverboat subsidy be discontinued, providing approximately $27 million of additional revenue to Indiana taxpayers. Alternative gaming, in the form of 5,000 machines (the number currently proposed by the Coalition) at racetracks and satellite facilities, can provide an additional $152 million annually in state and local taxes from alternative gaming tax revenues.
- The Coalition proposal brings home a billion dollar winner for Indiana. Our proposal provides adequate funding for purses and breed development funds in the horse racing industry, allowing it to continue to develop to maturity without state subsidy. Adding the revenue benefits of alternative gaming plus returned subsidy dollars to the annual economic impact of a mature, stable horse racing industry will bring home a billion dollar winner for Indiana.