Saturday, October 11, 2008
A Stimulus Package for Lagging Thoroughbred Handle
Compared to the rest of the world economy, thoroughbred racing in the United States is not doing all that bad.
The National Thoroughbred Racing Association and Equibase Company Thursday released the “Thoroughbred Racing Economic Indicators“ for United States and Canadian pari-mutuel wagering on U.S. Thoroughbred racing.
The figures released covered the third quarter of this year and how it reflected on purses and number of racing days.
During the third quarter, pari-mutuel handle decreased 9.85 percent from last year‘s seasonal figures. As compared to what on the Dow Jones average, 40 percent from October to October?
As a result of reduced handle, purses in the third quarter of 2008 were down 2.3 percent compared to the third quarter of last year, while race days were 1.2 percent fewer.
For the nine months that ended September 30, wagering was down 5.75 percent compared to 2007 levels, with purses dipping 0.04 percent and race days by 0.87 percent.
Thus far, $10.7 billion has been wagered this year as opposed to $11.4 billion in the first nine months of 2007, those figures including worldwide commingled wagering on U.S. racing and separate pool Canadian wagering on American races.
If the current trend continues, total betting for the year would fall below the $15 billion-mark, the annual average handle this decade.
Should this trend continue, the contribution that parimutuel taxes makes to state coffers where racing is conducted would be reduced sharply, which traditionally results in a loss of services via budget cuts, especially in the area of education, which can ill afford it.
The good news is that there’s a way to reverse the trend, possibly as soon as the middle of 2009.
But unlike the recent Congressional “bailout,” there’s no pork attached to this measure, not if the goal is to raise revenues as soon as next year. The taxpayers, read horseplayers here, would garner instant rewards, too, infusing their added income into the thoroughbred economy.
This is the tide that can lift all boats, those of the customer’s, racetrack’s, horsemen and states where betting on horses is legal. And where does this infusion come from? What can reverse the current trend and stimulate an industry that contributes to so many economies?
It’s called a tax reduction; lowering parimutuel takeout. Whenever and wherever lower takeout has been enacted, over time it’s resulted in increased handle--read revenue to all here. For the groups mentioned above, it’s a win, win, win, win. Less is more; a little smaller slice of a much larger pie
Brains, vision and guts, based on positive past performances. What could be easier?