State senators in Pennsylvania have introduced a bill that would transfer a portion of casino revenues to a fund that pays for regulatory costs and compliance costs for horsemen.
SB 352 would divert money from the Pennsylvania Race Horse Development Fund to the nearly empty State Racing Fund, which pays for two racing regulatory boards’ operations and drug-testing fees for racehorse owners. Under current state law, the fund is replenished with racing taxes. However, as the racing industry continues its decades-long decline, handle has plunged 71 percent and tax revenue has declined by 65 percent since 2001.
However, some conservative policy foundations quickly denounced the measure as corporate welfare for a dying industry. “Rather than handing out special subsidies to favored industries, lawmakers could cut corporate welfare and use the savings to lower Pennsylvania’s corporate tax rate, which is one of the highest in the industrialized world,” said Bob Dick, a policy analyst for the Commonwealth Foundation, in an interview with the website heartland.org. “The racing fund has been bailed out in the past, and there’s no guarantee another infusion of cash, even on a permanent basis, will keep it solvent in the future.”
Frank Gamrat, a senior research associate at the Allegheny Institute for Public Policy, added, “SB 352 proposes that funding to support the Race Horse Industry Reform Act come from three sources… the State Racing Fund, the PHRDF, and, if those two are not sufficient, the general fund,” Gamrat said. “Thus, the general fund is being used as a backstop for the industry. If the industry is not self-sustaining, it should find ways to cut costs or raise its own revenues.”
