HISA costs will fall on tracks and horsemen

Lexington, KY — The $72.5 million 2023 HISA budget will probably fall on the backs of the racetracks and horsemen in most states, according to the President of the Association of Racing Commissioners International (ARCI).

“Most states did not pay the HISA assessment that was sent in April and given the limitations of state resources it is unrealistic to expect a different result as I am not aware of any states that have told them otherwise,” RCI President Ed Martin said.

Martin said the HISA press release was misleading in that it led readers to believe that the States were automatically on the hook to pay the assessment unless they made a conscious decision to take themselves out.

Only those States making a conscious decision to “opt in” will be responsible for paying the assessment or imposing new fees. Based on the experience with the last round of assessments, only Kentucky, California, Minnesota and Colorado are paying HISA assessments.

HISA made a conscious decision to put the responsibility to pay on the racetracks even though HISA can assess fees directly on all aspects of the industry, including breeders who appear to be absolved of any financial exposure under the funding scheme.

“As everything with HISA is done behind closed doors, I am not aware that this approach was agreed to with the tracks or whether or not they had any input as to how HISA put their program and budget together. You would hope they were in the mix in that they will foot the bills,” Martin said.

Martin also noted that HISA made a conscious decision not to try to utilize significant parts of the existing infrastructure already paid for by the various States, specifically prosecutors and adjudication personnel.

“It is extremely rare for a state racing commission to lose a drug case, so why HISA would not want prosecutors who have never lost a case in the mix totally befuddles me,” he said.

Last December at the University of Arizona’s Racing Symposium, Martin warned that if HISA was not careful in formulating their program, they would risk losing tens of millions of dollars in public funds and resources and the Thoroughbred industry would have to pick up a much larger bill.

“The cost of this is totally on HISA. Over the past 15 months state regulators have met with HISA staff people and occasionally a HISA Board member listened in. Constructive ideas were offered. They listened, smiled, and were appreciative, yet whomever was making the decisions chose to ignore much of what was said, which is their right,” he said.

The ARCI continues to be concerned about the economic impact these new regulatory costs will have on small and midsized venues and those in the industry participating at those levels.

“Many are struggling with today’s economic realities fueled by high inflation, increased borrowing costs, and supply chain and labor availability. To some this is absolutely the worst time to impose additional new costs of this magnitude,” Martin said.

From the Association of Racing Commissioners International