02/02/2011 11:42AM

Christie signs horseracing subsidy legislation but still holds veto power

Bill Denver/Equi-Photo

By Matt Hegarty
New Jersey Gov. Chris Christie signed legislation on Tuesday that could direct $30 million from Atlantic City casinos to horse racing purses over the next three years, but it remains unclear if the money will ultimately find its way to the state's racetracks.

Christie has consistently said that he will not support subsidies to the racing industry as the state seeks solutions to closing a budget deficit. On Wednesday, a spokesman for the governor, Michael Drewniak, did not back away from that statement, but he also did not make it clear whether the governor would use his veto power over the New Jersey Racing Commission to block the distribution of the subsidies to Thoroughbred and harness tracks.

"The governor's goal remains the same, to have Thoroughbred racing become a self-sustaining business model in New Jersey, operating free of taxpayer subsidies," Drewniak said. "His administration continues to work with the respective parties to that end."

Uncertainty over the subsidies and the fate of Monmouth Park and the Meadowlands, which are both owned by the state, has left the racing industry in limbo. Although the commission has approved a total of 141 Thoroughbred dates for 2011, many in the industry had hoped to receive subsidies for purses in order to pare racing dates from the schedule and put on a boutique-type meet at Monmouth Park for the second year in a row. The state is also trying to negotiate a lease of the Meadowlands and is exploring a sale of Monmouth, muddying the waters even further.

Under the bill, a commission funded by the casinos would be required to send $15 million to the New Jersey Racing Commission this year to be distributed to racetracks for purse subsidies, along with $10 million in 2012 and $5 million in 2013. Governors in New Jersey, however, have an unusual power to veto actions taken by state agencies, so Christie could use that veto to block the distribution of the subsidies.

Under a three-year agreement that expired last year, the casinos provided $30 million a year to the state's Thoroughbred and harness industries, in exchange for the industry's vow not to seek slot machines.

State Sen. Jennifer Beck, who represents the district where Monmouth Park is located, said that she believed the subsidies were necessary to give racing time to experiment with strategies designed to reverse the sport's long slide.

"If the governor deems it necessary to help in this transition, there is funding from the Casino Reinvestment Development Authority that may be made available to the horse racing industry, thus ensuring New Jersey retains a diversified entertainment industry that includes both casino gaming and horse racing," Beck said, in a prepared statement.
Last year, Monmouth Park used $19 million of the casino subsidy to support purses for a 48-day meet at Monmouth in which average purse distribution hit nearly $800,000 a day, highest in the country. Handle and attendance during the meet skyrocketed, but it remains unclear if the meet was profitable.

Dennis Drazin, the chairman of the state racing commission and the former president of the New Jersey Thoroughbred Horsemen's Association, said on Wednesday morning that Christie had not stated his intentions to the commission.

"It would be premature for me to put out any comment until we have heard from him," Drazin said.