02/02/2005 12:00AM

Bets could help fund workers' comp in Ky.

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LEXINGTON, Ky. - The Kentucky Horse Racing Authority will recommend to Gov. Ernie Fletcher that the state fund a workers' compensation program for jockeys and exercise riders through a portion of the existing takeout.

The recommendation, approved unanimously at a special meeting of the authority on Wednesday morning, was approved after an hour of contentious debate among authority members. The authority had formed a committee to look at the possibility of covering jockeys under state workers' compensation programs late last year.

Under the recommendation, part of the takeout on in-state wagers on Kentucky races that go to racetracks and purses would be reallocated to the fund. Tom Ludt, an authority member who is the chairman of the insurance committee, estimated that the state would need to raise approximately $2.5 million a year to pay for the program. In 2004, betting on Kentucky races from in-state sources was $240 million, officials said.

Details of the plan would need to be forwarded to the governor by Monday for the legislature to act on the proposal during the current session, said LaJuana Wilcher, the secretary of the Department of Public Protection and an ex officio member of the authority. The Kentucky legislature is currently in an abbreviated session. The legislature cannot act on a bill that is not filed by Feb. 12.

Five states in the U.S. currently cover jockeys under workers' compensation programs: New York, California, Maryland, New Jersey, and Idaho. The programs are funded through a variety of mechanisms. In California, the legislature raised the takeout on exotic wagers to pay for the program, whereas in New York, funds are principally provided by assessments on trainers and owners.

Ludt's committee initially recommended to the authority that Kentucky adopt a plan similar to New York's. But he ran into objections from some members, including Dell Hancock, whose family owns Claiborne Farm.

"The owner is not the goose that laid the golden egg," Hancock said. "I think everybody should take part in funding this, and jockeys should be included, too."

The compromise reached by the authority will indirectly force jockeys to contribute to the program by diverting purse money to the program. In addition to mount fees, jockeys earn a percentage of the purse for finishing first, second, or third.

Rogers Beasley, the director of racing for Keeneland, said after the meeting that the compromise reached by the authority appeared to satisfy most parties, but cautioned that racetracks would not support the proposal until the exact details are worked out.

"We want to see the numbers," Beasley said. "And I also have some concerns about the time we are able to devote to this matter, and whether we are rushing into something."

Other racing officials complained after the meeting of objecting philosophically to the idea of covering jockeys and exercise riders under state programs, asserting that the riders would qualify for insurance that is not available to other independent contractors.

The workers' compensation program would make jockeys and exercise riders employees of the state for the purposes of the coverage, but their status as independent contractors would not change, according to Jim Emrick, an official with Kentucky's existing workers' compensation program.

Marty Maline, the executive director of the Kentucky Horsemen's Benevolent and Protective Association, said the recommendation of the authority was its best alternative, but predicted that many members of the KHBPA would have complaints.

"To be honest, we've got different people who feel different things," Maline said. "We hear that jockeys are independent contractors and that they want to advertise on their breeches and not share anything with the owners. Then in this issue they want to be employees. If they're employees, and they want to advertise, then shouldn't that flow through the owner, too?"

Ludt said that trainers would likely experience a "wash" on expenses with the program. Trainers would lose money from their share of the diverted purse money, but they currently pay workers' compensation costs on their existing payrolls, and that cost would be eliminated if the program were to be put in place. But he also cautioned that many trainers have evaded the current costs by paying exercise riders in cash, and that those trainers' costs will likely increase.

"I would argue that the trainers are trading dollars one way to another way, and there should be a lot of support there from those people," Ludt said. "The trainers who won't support this will be the ones that don't currently pay for it, and, in my opinion, they probably should be paying for it."