Study: Delaware programs account for $112.9 economic impact

By: Tom LaMarra

Posted: Jan. 20, 2020

In conjunction with a legislative proposal to increase funding for the Delaware Certified Thoroughbred Program and the Delaware Standardbred Breeders’ Program, a new economic study shows that the two programs produced about $112.9 million in direct and indirect spending in 2019.

Thoroughbred and Standardbred racing and breeding fall under the Delaware Department of Agriculture. The study was prepared by Applied Business & Economic Research Associates at the University of Delaware.

The DCTP, which is a residency-based program that offers lucrative purse bonuses and stakes for horses that compete at Delaware Park, accrues $1 million a year: $500,000 from the Delaware Thoroughbred Horsemen’s Association, $250,000 from Delaware Park and $250,000 from the state. The agriculture aspect of the program supports farms in the state, as registered weanlings and yearlings must be domiciled at a Delaware farm before Dec. 31 of their yearling season and remain on the farm for at least 90 days.

Thoroughbred purses in the state earn 10% of video lottery terminal proceeds at Delaware Park; for 2019 the contribution to purses was $13.5 million, according to the Delaware Lottery. The DTHA first sponsored the DCTP in 2002 by committing a share of purse revenue to pay related bonuses.

The legislation, introduced in 2019, would increase the state’s contribution to the DCTP by $250,000. The bill, which would increase the Standardbred program by $500,000, awaits consideration by the Senate Finance Committee during the current legislative session.

“An increase in state funding for the Breeders and Certified programs would increase the purses that high-performing Delaware-bred and Certified horses could earn,” the economic study states. “This incentive would attract new registrations to these two programs, thereby increasing spending and economic activity in the state.

“The economic activity resulting from a 17% increase in horses would produce $750,000 in state and local taxes, making the funding increase revenue-neutral within the state.”

The study indicates activity by Thoroughbred horsemen and breeders in 2019 generated $35.3 million in direct spending and employment with another $20.9 million in “additional multiplier contributions.” The total jobs supported by the spending was 454, with wages and salaries of $20.5 million. Standardbred figures were similar.

DTHA Executive Director Bessie Gruwell said that in 2019 there were applications for 263 horses to enter the DCTP for 2020. The number, down slightly from 2018 but up from 2017, is the second-highest in the program’s history, she said.

Last year the DCTP paid $1.11 million in bonuses and stakes purses, the most since 2011 when Delaware Park offered a longer meet. The program accounted for 757 starts from 258 individual horses at the track in 2019.

The DCTP pays a bonus of 25% to the owner and 25% to the certifier on top of earnings for first- through fifth-place finishes in all overnight races at Delaware Park. The bonus is capped at $10,000 for open stakes. There are four $100,000 stakes restricted to Certified horses in early fall and purse enchancements for Certified horses that compete in two stakes limited to horses that have started once at the meet.

(Photo by Tom LaMarra)