Posted: Jan. 5, 2016
Does the status quo for pari-mutuel handle and purses reflect stability or is it an indication Thoroughbred racing is stuck in a rut?
The questions will be debated in light of the 2016 Thoroughbred Racing Economic Indicators released by Equibase Jan. 5. Total commingled handle on United States races last year was up 0.58% and purses were down 0.91% compared with 2015, but total race days dropped 1.79% (85 days).
For 2016 handle totaled $10,735,154,543 versus $10,672,749,477 in 2015. With 657 fewer races, average wagering per race crept up to $280,408 from $274,074 in 2015.
Pari-mutuel handle last topped the $11 million mark in 2010, and hasn’t fluctuated much since.
U.S. purses last year totaled $1,083,741,023, down from $1,093,670,488 the previous year. At least one-third of purse money is derived from alternative forms of gambling, primarily slot machines and video lottery terminals.
The 2016 purse total is about where it was in 2005.
Average purses per race day in 2016 came in at $232,114, up 0.90% because of the drop in the number of race days. Average field size dropped from 7.85 in 2015 to 7.80, according to the Equibase statistics.
For the final month of 2016, wagering rose 3.27% and purses 5.19% from the December 2015, while race days dropped 1.07% year over year.
In a statement released after the numbers were released, National Thoroughbred Racing Association President Alex Waldrop said he views the results as positive.
“The 2016 wagering and purse report suggests that Thoroughbred racing in the U.S. has stabilized from the world-wide economic recession of a few years back,” Waldrop said. “A declining foal crop has challenged the industry to adapt by reducing races and race days and also encouraged innovation. It is noteworthy that handle increased in 2016 despite 85 fewer race days.”
He also said the fact top horses raced through the Breeders’ Cup was a factor in the numbers, and that expected changes in the federal tax code should help handle grow in 2017.
“One additional piece of positive news for the industry is the release by the Treasury Department and the IRS of proposed regulations that will fundamentally alter the way winning pari-mutuel wagers are withheld and reported,” Waldrop said. “By modernizing tax withholding and reporting to reflect the true cost of a wager, especially exotic wagers, more money will now remain in the hands of our customers who will re-bet most of those dollars for the benefit of all.”