Pennsylvania Governor Tom Wolf, in his new budget plan submitted to lawmakers, has revived a plan that he proposed last year to divert $199 million from the slot revenue fund propping up the state’s horse racing industry to create a scholarship program for students in state colleges and universities.
The proposed program would assist an estimated 20,000 students with annual scholarships of up to $5,700 per student, depending on household family income.
In a statement, Wolf pointed to the fact that Pennsylvania college graduates have the second-highest student loan debt in the U.S. “There is a student loan debt crisis across our country,” Wolf said. “It’s a burden on young people and their families that can last for years and holds them back.”
Representatives of the horse racing industry, which supports around 7,400 direct jobs and supports another 8,000 jobs, say the fund diversion would destroy racing in the state. The Race Horse Development Fund, created by the 2004 gaming law, is funded by a portion of the 55 percent tax the state imposes on slot revenues. The state’s racetracks fund 95 percent of purses with that money, which returns around $200 million a year.
“This would absolutely destroy the horse racing industry and the more than 20,000 jobs that are associated with it,” said Pete Peterson, spokesman for the Pennsylvania Equine Coalition, in an interview with the Philadelphia Inquirer.
Others in the state, particularly in the education field, are not sympathetic. “The legislature has to make a choice,” Susan Spica, executive director of the advocacy group Education Voters of Pennsylvania, told the Inquirer. “They can either fund college students who will become our teachers and nurses or continue to give $200 million to wealthy horse owners, many of whom live out of state.”
A spokesperson for Wolf told the newspaper it is time for the state’s racing industry to stop relying on the subsidy. “While the racing industry is important to Pennsylvania, it is time for the industry to support itself and continue to build upon the unprecedented generous economic investment made by the commonwealth to this single industry,” said Elizabeth Reenter. “The industry survived long before the subsidy began and it has had 16 years and $3 billion to develop what, by now, should be a self-sustaining industry.”
It is unclear whether Wolf’s proposal, which failed to gain legislative support last year, will fare any better this year. For one thing, success would require amending or repealing another law, passed in 2017, that deems the racing trust fund untouchable for other purposes.
