Negotiations Ongoing as Penn Shutdown Looms

As a Friday deadline loomed for the issuance of a “cease operations in 30 days” notice for the out-of-money Pennsylvania Horse Racing Commission, horsemen, racetrack operators and government officials continued to negotiate a budget workaround that would prevent the end of racing at the state’s six Thoroughbred and Standardbred tracks.

On Oct. 22, Gov. Tom Wolf’s administration threatened to pull the plug on the industry because the state is currently operating without a budget, and the accompanying legislative gridlock has prevented a transfer of money into the under-funded racing commission. The PHRC’s administrative and drug-testing costs are about $20 million annually and the current shortfall for this year is roughly $6.5 million.

Salvatore DeBunda, president of the Pennsylvania Thoroughbred Horsemen’s Association, said in-person meetings and phone conferences among stakeholders have been ongoing since Tuesday in an attempt to present a plan that would shift costs off the state and–at least partially–onto horsemen and the tracks.

“Proposals were made by the Department of Agriculture with the support of the legislature and the governor’s office about how we might bundle some things that would get this resolved,” DeBunda said.

He spoke to TDN just before entering into a late-day teleconference on Thursday that was supposed to shore up the plan that will be presented to state officials.

DeBunda said he could not cite a ballpark dollar amount that horsemen might have to commit to until the agreed-upon plan is more fully hashed out.

“There is no way to do that,” DeBunda said. “What’s being [proposed] is both a restructuring of the operation of the racing commission; having the horsemen consider paying some [future] expenses directly instead of out of the [gaming revenue] racing fund, and then how the question of how the deal would [address] the anticipated deficit this year. But until it’s resolved, I don’t think I could give you an idea of what those numbers would be.”

DeBunda outlined the three likeliest outcomes of this week’s negotiations.

“One would be that they find this acceptable enough to withdraw the threat,” he said. “Two, they might feel that some tweaking is necessary and decide to maybe extend for a week while we work that out. And three may be a total rejection. I’m not predicting which one, but those are the three possibilities as I see it.”

DeBunda said he believed a key point in convincing the state not to shut down racing is an effort among stakeholders to not just come up with a band-aid fix.

“What we’re proposing is a long-term solution. That’s what we’re discussing, so that we wouldn’t have this problem every year,” DeBunda said. “We’re prepared to take steps for [a shutdown] if it happens, but we’re not gearing up for it because we’re hoping that we’ll either resolve it or get more time to resolve it.” –@thorntontd