Purse restoration bill passes both houses of West Virginia legislature

By: Tom LaMarra

Posted: March 7, 2019

Update: Gov. Jim Justice signed the purse restoration bill into law March 7.

Posted: Feb. 22, 2019

Legislation that would restore about $11 million a year in purse money that for most of the past 13 years has been used to support a statewide Workers’ Compensation Debt Reduction Fund passed the West Virginia House of Delegates Feb. 22.

The House vote was 86-10 with four absent. The measure passed the state Senate by a 34-0 vote on Feb. 12. The  bill goes back to the Senate to confirm a technical amendment, and then onto to Gov. Jim Justice for consideration.

Purse accounts at the four tracks in the state—two Thoroughbred and two Greyhound—contributed roughly $154 million to the debt-reduction fund from 2005 until it was paid off a few years ago. Since then, however, the $11 million a year was deposited in the Excess Lottery Fund for other uses in the state.

Sen. Bill Blair earlier said that before 2005, about 14% of revenue from video lottery terminals at the state’s tracks under the original gaming legislation from the mid-1990s. Coupled with a 2014 “haircut bill” that diverted even more purse money to pay for other programs, the original percentage has at least been cut in half.

In voting to support the measure, Del. Paul Espinosa, whose district is Jefferson County, where Hollywood Casino at Charles Town Races is located, noted that the coal, gas and timber industries, which also were asked to pay down the workers’ comp debt, had their funding restored. The only one that didn’t was horse racing.

“I’m not a fan of the gambling industry, but I voted (for the bill) because a promise made is a promise kept,” said Del. Tom Fast, whose district has no racetrack casinos.

The bill on Feb. 21 was subject to a lengthy debate and withstood an amendment that would have instead given the $11 million to education. But lawmakers pointed out education already is a major recipient of VLT revenue generated at racetrack casinos.

Del. Bill Anderson, who was a member of the House in 2005, said West Virginia at that time was “imploding, going under as a state” in regard to a $4 billion workers’ compensation debt, and the contributions from racing and other industries turned it around.

“I don’t have a racetrack in my district, and I don’t know of anyone who makes a lot of money from racing in my district,” Anderson said. “But in a matter of fairness, this is the last special assessment that needs to be restored.”

The Charles Town purse account, which paid the most in the debt-reduction effort, figures to increase by $5 million to $6 million a year should the governor sign the bill. Based on $23 million in gross purses at Charles Town in 2018, purses could increase about 25%.

Charles Town HBPA President Jim Miller said he spent much of January working on legislative issues in Charleston, the state capital. He said the restored funds could amount to about $30,000 per program in additional purse money and could help pay for additional racing dates.

“It would have a real impact on our program,” Miller said. “It would give us more of a stable base.”

Justice in the past has said he wants a stronger racing and breeding industry, and two years ago vetoed legislation that would have decoupled Greyhound racing from the casino industry by ending the VLT contributions to purses and a fund for Greyhound breeders. The horseracing industry expressed concerns the legislation could set a precedent in the state.

In other action Feb. 22, the House advanced to third reading legislation that would authorize advance deposit wagering, which is not currently legal in West Virginia. The bill calls for a source-market fee of 6% of total handle by each ADW provider and a 1% regulatory fee for the West Virginia Racing Commission. It states that license fees and renewal fees can’t exceed $5,000.

(The ADW bill passed the House by a vote of 77-20 on Feb. 25 and was sent to the Senate for consideration.)

The House also passed, by a vote of 87-8 with five no-votes, a bill that would allow a racetrack casino to open a satellite VLT facility in the county in which it is located. It now goes to the Senate for consideration. The bill is said to have been largely pushed by Delaware North, which owns two Greyhound casinos in Wheeling and just outside of Charleston.

(Charles Town photo by Tom LaMarra)