01/26/2005 1:00AM

West Virginia to tap purses

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A bill advocated by West Virginia Gov. Joe Manchin to privatize the state's workers' compensation program has targeted $20 million in purse subsidies at the state's racetracks for a portion of its funding.

The bill would raise $230 million from a variety of new taxes and other sources to underwrite bonds to cover liabilities of the existing workers' compensation fund.

West Virginia tracks received $91.9 million in purse subsidies from slot machines in the fiscal year 2004, which ended June 30, according to the state racing commission. The subsidies are calculated under a formula that directs as much as 15.5 percent of the machines' net revenue to purse accounts. As much as 47 percent is retained by the tracks themselves.

John Melton, the general counsel for the West Virginia State Lottery Commission, said the funds for the workers' compensation program would be raised by splitting the contribution to purses from slot machines between the state and the purse fund. The state's share, however, would be capped at $20 million.