Page 85 - Speedhorse December 2019

“People Are Excited
That Texas Is Going
HEADLINE
To Actually Come
Into The 21st Century
Subhead
As Far As Purses Are
And Be More Competitive With
Surrounding States. Our Purses Should Double For Sure. I Think They’ll Do Better Than That.”
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by Jennifer K. Hancock
Lone S tar
REBOUND
When Texas Governor Greg Abbott landscape, and interest in the Texas-bred TXP Inc. in Austin, bettors in Texas wagered
signed Texas House Bill 2463/Senate Bill 1991 into law on June 15, horsemen in the Lone Star State breathed a sigh of relief. After years of competing with neighboring states, who have the advantage of casino-boosted purses, Texas horsemen will now see a bit of relief as purses began receiving an infusion from diverted sales taxes this fall.
On Sept. 1, sales taxes on horse feed, tack and other horse-related products and services began being redirected from the state’s general fund to an escrow account established by the Texas Racing Commission and will be used
in part to boost purses for Thoroughbred and Quarter Horse races. Capped at $25 million annually, no more than 70 percent of the funds in the escrow account can be used for purses. If the escrow account reaches the maximum, an additional $17.5 million in purse money would be available annually – practically doubling the state’s current purse amount.
While it’s too early to compare data from previous years since the law went into effect in September, the ringing phones at the Texas Quarter Horse Association offices suggest horsemen definitely noticed the improving
program is soaring.
Rob Werstler, Texas Quarter Horse
Association’s race director, said the new funds are already acting as a boost for an industry that was clinging to life over the past few years.
“Although I can’t give you any statistics right now, I know we’re getting tons of phone calls from people who have never participated before, and they have questions about accredited Texas breds and how to do it and all that,” Werstler said. “I know those are new. Again, this is from my memory not with our official numbers
yet, but it seems like we’re getting a lot more broodmares now than we ever had in this stretch. So, yes, I would say it’s already having an effect.
“People are excited that Texas is going to actually come into the 21st century as far as purses are concerned and be more competitive with surrounding states,” Werstler added. “Our purses should double for sure. I think they’ll do better than that.”
While most industries see growth or even increases associated with inflation, Texas horsemen watched purses reduce by about half over the past two decades. According to a study prepared for racing industry consultants by
approximately $900 million in the early 2000s, and horse breeders and owners raced for about $32.5 million in purse money during that
same time period. By 2018, those number had dropped to $340 million wagered at Texas tracks, and horses raced for $16.8 million in purses.
Less money wagered equated to less purse money, which created a vicious cycle in Texas. At the same time, costs for racing horses didn’t decrease but continued to rise.
The TXP study contends a state contribution of up to $25 million a year in purse money
not only boosts tracks’ revenue, but also could double the current direct impact on the overall Texas economy to $154.6 million by 2022.
Werstler explained the new funding process.
“It’s an application process,” he said. “The way it works is 70 percent of the money
goes toward purses. That money goes to the racetracks to use as purses – period. It can’t be used for anything else. There’s 30 percent that any of the breed registries that are named in the Texas Racing Act can apply for, and it can be used for any event that furthers the Texas horse industry. It doesn’t have to be racing. It could be any type of horse event such as a cutting, barrel
SPEEDHORSE, December 2019 81