Following an economic impact study released by Sage Policy Group on Nov. 21, which found that Maryland horse farming contributes $1.15 billion annually into the state’s economy, Sagamore Racing president Hunter Rankin contributed his thoughts to The Daily Record about the importance of investing in Maryland horse racing.
The Daily Record (11/22)
Maryland horse industry rebound fueled by slots
By Adam Bednar
Maryland’s horse industry is rebounding, and much of the credit goes to revenue from slot machine gambling injecting cash into the field, according to the author of a recent report.
On Monday, Sage Policy Group released an economic impact study that found Maryland horse farming pumps $1.15 billion annually into the state’s economy. That’s a 23 percent increase from the $930 million in 2010.
The findings don’t include economic impact from racetrack operations. That includes roughly $30 million in statewide impact from the Preakness, the second jewel in horse racing’s Triple Crown run at Baltimore’s Pimlico Race Course.
Anirban Basu, chairman and CEO of Sage Policy Group, said the turning point for the industry came when voters passed a constitutional amendment approving slot machine gambling in Maryland more than eight years ago. The industry, in the years leading up to that point, struggled because of declining purses while surrounding states bolstered their horse industries with funds from slot machine gaming.
“There was a real immediate impact from slots on the purses and the health of the horse industry,” Basu said.
Maryland directs 7 percent of slot machine revenues to the Purse Dedication Account and to the Racetrack Facilities Renewal accounts. That funding is expected to get a boost when the MGM National Harbor in Prince George’s County becomes the sixth casino operating in the state next month.
Basu’s findings are supported by recent increases in handles, or total bets taken. Handles are considered a solid indicator of interest in horse racing. The Maryland Jockey Club, according a news release issued Sunday, expects to take in $425 million in total handle this year compared to $355 million in 2015 and $296 million in 2014.
The total handle for Saturday’s 11-race Fall Festival of Racing at Laurel Park increased to $4.51 million this year from $3.77 million the previous year. Betting on the Jim McKay Maryland Million Day in October also increased 18.5 percent from 2015 and 59.8 percent from 2014.
Sage’s report, which was paid for by the Maryland Horse Breeders Association and a dozen other industry groups, found Maryland’s horse industry supports 5,800 full-time jobs in Maryland. Those jobs produce nearly $500 million in wage and salary income. Spending on the industry in Maryland was estimated at more than $660 million in 2015.
Now that the industry is rebounding, some experts believe it will begin growing organically, with investment in the industry attracting more dollars.
Hunter Rankin, president of Sagamore Racing, which is owned by Under Armour CEO Kevin Plank, said the state has been doing a good job of supporting the industry. But he added the philosophy for his organization is to invest “inside the rails” at its operation at Sagamore Farm, and that success there would help the industry return to prominence in Maryland.
“We want to lead by example. Our hope is our investment encourages others to invest in the sport and the industry,” Rankin said.
Although Basu believes the industry is recovering, he warned that state budget woes — Maryland cut revenue projections in September by $800 million — have some in the horse industry worried the funding formula from slots could be altered.
“The level of confidence is pretty high. It could be higher,” Basu said.