New Jersey racing needs long-term solution, along with short-term fix
How much time does $90 million buy? Right now, for New Jersey racing, the answer is appears to be about three years.

The state of New Jersey has thrown its horse racing and breeding industries a lifeline in the form of a $90 million subsidy that will allow Monmouth and the Meadowlands to maintain an attractive purse structure in 2008, ’09 and ’10.

Funding for the subsidy comes from Atlantic City casinos, which get the better end of the deal. In exchange for $30 million a year, racing interests have essentially agreed to a non-compete clause—a state law ensuring that the tracks will not operate video lottery terminals (slot machines) during that time. Casinos will also receive tax breaks that are set to outlast the term of the subsidy.

The new subsidy agreement, announced in early March and subsequently approved by the state legislature, is of course better than no deal at all—which is what New Jersey’s horsemen and breeders were faced with after the previous four-year $86 million casino subsidy expired at the end of 2007.

Without this temporary fix, purses at Monmouth were expected to plummet to around $200,000 a day for the 2008 meet that begins on May 9. Last year’s daily purse average of approximately $330,000 is now projected as a minimum level for the upcoming meet.

Monmouth’s purses will remain the highest of any track in the region. But the subsidy is still a long way from a long-term solution to the industry’s financial problems—many of which can be traced to the competitive advantage held by the same gaming establishments that are footing the subsidy.

New Jersey’s racing and breeding industry has a proud history that grew even stronger last fall when Monmouth hosted the two-day Breeders’ Cup World Championships. It should not be reduced to living on handouts.