When driving around beautiful King Township my gasps of pleasure at the sight of the rolling hills is seconded only by the pleasure of seeing beautiful horses grazing. I am neither “into horses,” nor do I gamble, but with the announcement by the Province to end the “Slots At Racetrack” program I am paying attention to both. If executed as announced, the impact on King is huge.
Why is it important? From the 2006 census it is clear that horses are not just important for King Township to give pleasure to someone driving by! We have 374 horse farms and 7,457 horses. Economic impact to King is $13.3 million. The industry has $136 million invested in fixed assets in King.
In 1998 the Province introduced a program whereby OLG slots are located at racetracks. Under the Slots At Racetracks Program revenue is split 80/20 (Province/racetrack & industry).
A significant portion of the industry’s share is used to create a lucrative purse at the tracks which encourages people to race horses. Because the winnings are attractive the owners spend a lot of money in the various support industries. Because a healthy horse can win a lot of money, sophisticated and innovative veterinarian services exist.
As part of the 2012 Omnibus Budget Bill the Province announced that the program will be terminated March 31, 2013. Since the announcement the industry has been protesting that the end of the Program is a severe, perhaps fatal blow to the horse racing industry. Already the amount of breeding activity has fallen >30%.
There are several sets of numbers to describe the impact of the Slots At Racetracks Program; no matter which you look at it is evident that this program is significant to Ontario. One former track owner reports these numbers: $1.1-billion in direct revenue for the Province and $345-million for the horse racing industry including the tracks. The $345 million has this impact: $261-million in direct tax revenue for the Ontario government, a $2-billion annual economic impact on the province, and the employment of roughly 60,000 Ontarians.
I have heard one King Township resident who owns 3 quarter horses for the pleasure of riding say that he is personally not enthusiastic about horse racing but he is very concerned about the demise of the tracks and hence the death of all the “support” industries in and around King. He worries about what kind of veterinarian services will be available and where the farriers will be.
So given the total impact of the Slots At Racetrack Program a decision to eliminate it must be well thought out and the future plan must be pretty dynamic…right?? So far I don’t think either prerequisite has been satisfied.
I have read the OLG Strategy document (you can read it here); I don’t see the business case for eliminating the Program. Yes, I can see the need for modernizing Gaming and Lottery in Ontario but I don’t see the rationale for eliminating the Slots At Racetrack. And I don’t see how consolidating slots to be run by private sector in other venues is going to deliver better total results (i.e. more revenue.) It is very worrisome that it was only after the industry started to protest that the Province announced a $50 million fund to assist with the transition.
In addition to earning more revenue Premier McGuinty says that “The plan [i.e. the modernization of Gaming and Lottery] will also create 2,300 new jobs in the gaming industry and nearly 4,000 additional jobs in the hospitality and retail sectors by 2017-18.” Given that the horse racing industry is saying that the elimination of Slots At Racetracks is almost a fatal blow to their industry new jobs in gaming and hospitality and retail sectors does not sound like a net gain. We will lose all those jobs supporting horse racing: growing &delivering feed, veterinarian services, transport of horses, trainers, jockeys. If there are no horse races there is no proof that your horses are valuable; breeders will suffer.
To learn more about the total impact of the proposal you can click here. If you share my concerns I encourage you to write Premier McGuintyto express your disagreement with the current plan of eliminating Slots At Racetrack Program without a fulsome analysis and review of the impact and without a transition plan to mitigate damage.
Finally…back to my enjoyment of seeing horses on the hills in the countryside. What will happen to this “empty” countryside if the horses leave? What other economic activity will develop on the landscape of the Oak Ridges Moraine?
King Township is hosting a forum for Equine/Horse Industry Stakeholders on Wednesday 8/15. And, with other municipalities King will be talking about this issue at the upcoming Association of Municipalities of Ontario conference 8/18-8/21.
Hi Debbie
With respect to York Region’s numbers and the Census data….. I suggest that the economic impact numbers are a little on the low side….
For example, Jamie Smyth, Patty Fleetwood and I visited a farm operation a few years back now that had 80 horses on site at that time. The Farm Manager stated that he spent annually at a local feed mill close to a 1/2 million dollars; if one takes that number and uses it as an average, this would result in a total feed bills for about 7,500 horses of close to $ 47 million (a significantly higher figure than York Region’s stated $ 13 million). Add in farriers, veterinarians, tack and harness, and a variety of other anicilliary industries and a more accurate number would probably be in the $ 100 million dollar range.
With regard to the fixed assets of $ 136 million …. which averages out at about $ 360,000 per farm; I have to wonder if this number isn’t a little conservative as well. Admittedly there are a number of smaller operations in King Township but these days you would probably be lucky to get away with spending as little as $ 360,000 to get the farm buildings needed put up.
Finally, I note no comment on the value of the livestock; which while not a fixed asset, represents the largest investment many of these operations will make, and represents value in King Township.
Admittedly the farm Patty, Jamie and I went to was a higher end operation; but on that day the farm manager, when asked, indicated a value of the livestock estimated at $ 65 million (about $ 800,000 per horse). If one were to conservatively evaluate the livestock; based on York Region’s 7,500 horses and using an average of $ 50,000 per horse (not unreasonable these days for better horses) this comes out to about $ 375 million.
The point in all this is to try to ensure that the Council and York Region (perhaps), have a clear understanding of the magnitude of the issues.
The equine industry is a relatively quiet closed environment but this does not mean that it isn’t a vital, desirable and very large contributor to King Township’s local economy.
Thanks
Jeff L.
Hi Jeff, I get your point totally. And I appreciate hearing the stats from the one farm you visited awhile ago. You are right, it does make one wonder if the 2006 census data is understating the significance of the industry. Will do some follow up. thanks