Legislative

Texas Horsemen Reach Industry Agreement

On July 9th, representatives of the Texas Horsemen’s Association, Inc. (QH & Paint), the Texas Thoroughbred Horsemen’s Association, Inc. (TB and Arabian), the Texas Quarter Horse Association and the Texas Thoroughbred Association met and came to a unanimous agreement.

As rules are promulgated by the Texas Racing Commission and other decisions are made with respect to the revenue created in House Bill 2463 by the 86th Texas Legislature, all the money will be split equally (50/50) between Quarter Horse interests and Thoroughbred interests. The fund is anticipated to generate $25 million annually; therefore, if fully funded, Quarter Horse interests will receive $12.5 million ( 70% can be allocated to purse money) and Thoroughbred interests will receive $12.5 million each year.

It was further agreed that Paint breed interests will work with the Quarter Horse organizations for a share of the revenue to come from the Quarter Horse allocation and Arabian breed interests will work with Thoroughbred organizations for a share of the revenue to come from the Thoroughbred allocation of revenue from HB 2463.

The boards of all the Texas horsemen and breeder organizations wanted to reach an agreement, so they can immediately begin the work of developing a strategy of investing the economic incentive fund in a way that will improve Texas horse racing.  It is critical that all organizations work in harmony so that horses and horsemen return to Texas and encourage economic investment in Texas racing.       

 The agreement in no way stipulates how either breed allocates the money between breed incentives or purse allocations.  Each of the breed interests will determine the best use of the funds allocated to them to further the horse racing industry in Texas.

The agreement applies only to the allocation of the revenue created by HB 2463 and covers the period from September 1, 2019 through August 31, 2021.

 

Texas Governor Signs Legislation To Benefit State Racing Industry

JUNE 14, 2019—Texas Governor Greg Abbott signed a piece of legislation  that will benefit the Texas racing industry.

House Bill 2463/Senate Bill 1991 is a purse matching bill that would take a portion of the money collected by the state on the taxable sale of horse products, to create an incentive fund that would increase purses to bring quality race horses and breeding operations back to Texas.

Proponents of the bill, which creates no new taxes, say it will make Texas racing regionally competitive again.

According to a study prepared for racing industry consultants by TXP Inc. in Austin, in the early 2000 bettors in Texas wagered $900 million and horse breeders and owners enjoyed $32.5 million in purse money. Last year those number had dropped to $340 million wagered at Texas tracks and the owners took home purses of $16.8 million.

The study contends that a state contribution of up to $25 million a year in purse money would not only boost tracks revenue but would, by 2022, double the current direct impact on the overall Texas economy to $154.6 million.

Unlike in past sessions, the horse track bills this time drew almost no editorial or political attention.

Article provided by stallionesearch.com


Summary of Bills passed this legislative session:

House Bill 2463 (HB2463), filed by Rep. Tracy King, is a purse matching bill that would take money from General Revenue funds collected by the State Comptroller on the taxable sale of horse feed, supplement and tack to create a $25 million annual incentive fund that would increase purses to bring quality race horses and breeding operations back to Texas. The bill, which creates no new taxes, would make Texas racing regionally competitive again. (The bill is similar to a Texas Parks and Wildlife program that uses a portion of the tax collected from the sale of sporting goods and directs it to programs that promote outdoor activities.)  Economist Jon Hockenyos estimates that by the third year of implementation, the state will more than recover the annual investment based on the increased economic spending spurred by higher purses. In other words, taxes collected on horse industry activity would be put back into the industry to grow it for the benefit of the horsemen and women and the state’s economy.

An economic impact study recently completed by TXP, Inc. demonstrates the positive impact implementation of the bill could have both on the racing industry and the State of Texas. To read the report, click here

House Bill 1995 (HB1995), also filed by Rep. Tracy King, would redirect tax on interstate simulcast wagers in Texas from the General Revenue to the Texas Racing Commission’s funding. This would stabilize funding for the agency responsible for enforcing the Texas Racing Act and regulating the pari-mutuel industry. It would also protect against another “shut down” of the Texas Racing Commission, which in the past has jeopardized the operation of the entire horse racing industry and has threatened thousands of jobs. 

House Bill 3366 (HB3366) would take the Accredited Texas-Bred (ATB) funds out of the Texas Racing Commission budget and establish an escrow account for that money. This would ensure that the incentive fund is protected and delivered to the audience targeted by the Legislature. It would also provide a more accurate reflection of the Texas Racing Commission’s actual budget.

Both HB1995 and HB3366 would reduce both costs to the Texas Racing Commission and the fees it assesses to the Texas racing industry stakeholders it licenses.

If you have questions about these bills, please feel free to contact the TQHA office at (512) 458-5202.


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Why the horse industry should be engaged with legislative issues:

There are state laws that have a major impact on agriculture, including the Texas horse industry. Our legisture determines tax policy on sales, property, and franchise taxes. And, they can affect our access to water and the use of our land. These are issues that are important to everyone in the agriculture industry. And, of course, there are issues specific to the horse and livestock industry, such as Texas racing, animal welfare, and animal health. It takes active participation of all the independent organizations representing agriculture to be effective at the Capitol.

The 86th legislative session began on January 8, 2019 and ended May 27th.