Kentucky tax aid sought

Kentucky Gov. Ernie Fletcher has proposed that state sales taxes for stud fees be diverted from the state's general budget into breed-development programs for Thoroughbred and Standardbred horses in the state.

The proposal, included in the governor's state budget, would answer a call from many Kentucky breeders who have claimed that other states' breeders' awards programs are threatening the Kentucky horse industry. The establishment of a breeders' awards program has been a specific lobbying goal of the Kentucky Equine Education Project, a nonprofit group formed last year to lobby on racing issues.

According to Damon Thayer, a Kentucky state senator and an official of the National Thoroughbred Racing Association, the program would provide approximately $15 million for breeders' awards, based on tax revenue in 2004. Eighty percent of the taxes would go to a fund for Thoroughbred breeders, 13 percent would go to Standardbred breeders, and the remaining 7 percent would go to other horse breeders, Thayer said.

Sales tax in Kentucky is 6 percent and is now applicable to stud fees.

Kentucky already has an owners' award program, the Kentucky Thoroughbred Development Fund, which allows Kentucky-bred horses to qualify for additional purse money in open races. Kentucky racetracks do not write races restricted to Kentucky-breds.

Thayer said that he has worked with the governor for three months on the details of the program. If approved by the legislature, it would go into effect on Jan. 1, 2006.