Skip to main content
Part of complete coverage on

The death of a race course? Funding cuts take toll

By Marc Webber, For CNN
October 12, 2012 -- Updated 1127 GMT (1927 HKT)
Historic Fort Erie Race Track in Ontario, Canada, is headed for closure after controversial changes to gambling taxes on slot machines. Historic Fort Erie Race Track in Ontario, Canada, is headed for closure after controversial changes to gambling taxes on slot machines.
HIDE CAPTION
Fort Erie's bleak future
Race for cash
Staying afloat
Royal reception
Betfair Britain?
<<
<
1
2
3
4
5
>
>>
STORY HIGHLIGHTS
  • Half of Ontario's race tracks could close when government pulls funding scheme
  • Feeling the pinch is 115-year-old Fort Erie Race Track in Ontario, Canada
  • British racing starts finding new revenue sources to offset fall in betting money
  • Future of horse racing may lie in marketing to family friendly audience

(CNN) -- On a blazing summer's day in 1961, a race horse called Puss n Boots decided enough was enough and took an impromptu dip in a nearby lake. The only problem? He was racing at the Fort Erie Race Track at the time.

Jockey Ronnie Behrens was sent flying as the horse made a sharp detour for the scenic infield lake. Adding insult to injury, wilful Puss n Boots had been winning the race at the time.

The fabled plunge has gained almost legendary status in Canada, with Fort Erie now holding an annual Puss n Boots Stakes -- ending with a traditional leap into the lake by the winning jockey and trainer.

But as Canadian government funding cuts take their toll, it seems the jockeys are not the only ones trying to stay afloat.

Rise of the celebrity horse owner
Sakhee Pearl, ridden by Ian Mongan, claims victory in a handicap race at England's Kempton Park racecourse in 2011. Sakhee Pearl, ridden by Ian Mongan, claims victory in a handicap race at England's Kempton Park racecourse in 2011.
Standing out in the crowd
HIDE CAPTION
<<
<
1
2
3
4
5
6
7
>
>>
History of gray horses History of gray horses
@peopleshorse: "Really enjoying my little holiday - getting a serious tan! NOL."<br/><br/>
@peopleshorse: "Really enjoying my little holiday - getting a serious tan! NOL."

Tweet Lady
HIDE CAPTION
<<
<
1
2
3
4
5
>
>>
Racing horses take to Twitter Racing horses take to Twitter

The picturesque 115-year-old Fort Erie track now looks set for closure after controversial changes to gambling taxes.

"The whole racing industry in Ontario is in trouble," Fort Erie Economic Development and Tourism Corporation manager, Jim Thibert, said.

"Fort Erie Race Track is on a closing plan for the end of this year. The only thing that would interrupt that plan would be if we increased our business from CAD$30million ($30.6million) to CAD$35million ($35.6million) a year."

Thibert said the outlook was fairly bleak for the historic track which employs 240 people. It is thought another 600 jobs could be lost through support services if it is forced to close its doors as planned in December.

Read: Female pioneering jockey who cracked the whip

At least 25,000 racing jobs in Canada are under threat from the controversial new laws, says the industry.

Under the plans, funding sourced from a tax on government-owned slot machines at race tracks will be redirected.

The result? Around CAD$345million ($351million) of funding coming into the sport will be lost.

Currently, race tracks and horse owners receive 10% each of this fund to invest in facilities and thoroughbreds.

But from March, that money will instead be directed into the government's general revenues.

Legislators in Toronto have offered CAD$50 million ($51million) of 'transitional funding' to the industry to ease the burden.

But Sue Leslie, president of the Ontario Horse Racing Industry Association, said many in the industry are bracing for the worst.

"We have 17 race tracks in Ontario. Three of them have already had the government slot machines removed and one has said that they are unable to stay in business after the end of the year," she said.

"If that is the way it is going to be when the funding program fully closes in March, we will be down to nine race tracks at most."

She added: "It's about jobs, sure, but it's also about the welfare of the animals too. Who is looking after the horses if no one is buying them? What level of care will they get if the amount of money is cut?"

France's greatest horse trainer?
Endurance horse racing in the desert
Maintaining a racetrack in a rainy land

Read: Grand National Safety changes announced

Amid austerity, the Ontario provincial government says it was compelled to overhaul its tax system on slot machines.

"Given our current economic situation our government is committed to reviewing all programs in order to reduce the rate of spending growth," said ministerial spokesman Aly Vitunski.

"The Slots at Racetrack Program is no exception. Since 1998 the horse racing industry has received CAD$3.7billion ($3.77billion) in government support -- that's more money than we spend on water and road safety.

"At the end of the day we need to ask ourselves whether the government should be in the business of healthcare and education or horse racing."

Britain's Betting Levy

And it's not just the Canadian racing industry feeling the pinch.

Since the 1960s, when off-track betting was legalized in Britain, the racing industry has benefited from a direct payment from bookmakers called the Betting Levy.

But that Levy is now under threat as some firms take advantage of a loophole which allows them to base online wagering units outside the UK and pay no money -- despite taking bets on British races.

"The Levy has almost halved in value between 2009 and 2011 to £34 million ($53 million) and this is starving the sport of prize money, which is its lifeblood," says British member of parliament Matthew Hancock, who is trying to close the loophole.

"I speak to owners who now cannot cover their fuel costs to get to the race tracks, even when their horses perform well."

He says if no action is taken to reform the Levy, it could put at risk the livelihoods of some of the nation's 100,000 horse racing employees.

In response, UK betting companies say a change in the rules would lead to extra costs for them and the possibility of 2,000 betting industry workers losing their jobs.

One of the 'offshore' companies at the center of the issue, Betfair, has tried to strike a balance by signing a five-year, £40 million ($63 million) funding deal with the British Horseracing Association.

Future of horse racing?

With betting and gambling proving to be a source of funding headaches, could racing bodies walk away from wagering as a main source of revenue and look to make it in other ways?

We need to ask ourselves whether the government should be in the business of healthcare and education or horse racing
Aly Vitunski, Ontario ministerial spokesman

"Relying on handouts is not the way forward and it is all about trying to harness all the assets you have in racing and not sit back on a single funding mechanism," says Nigel Roddis, development director of Racing for Change, an organization looking to boost race track attendances and revenues.

"It's about making the product on the track far more attractive to corporate sponsors and families alike so they want to be part of it.

"That includes marketing to a new audience -- when they come they won't just pay at the gate, they will eat here, drink here, bet here and each day adds to the diversification of our income."

And it seems to be working. The number of people visiting UK racing meetings rose by 5% in the past year, according to British horse racing commercial group The Jockey Club.

Meanwhile, the British Horseracing Association will also help deliver £50 million ($79 million) worth of improvements to racing facilities, through the sale of the former state bookmakers.

Read: Horse appeal: Why gray thoroughbreds are great

Even the owners of Fort Erie in Ontario are now turning away from gambling in a bid to secure its future.

Plans for a hotel and tourist resort have overtaken the battle to secure government state funding, as Jim Thibert explained.

"We are nine miles from Niagra Falls and just over the border from the United States . We could build a place to stay which encourages tourists to come here and still see the horse racing," he said.

"Things are tough with the removal of the slots revenue, but there still is hope that we could get funding to build something different here and keep racing alive."

ADVERTISEMENT
Part of complete coverage on
April 4, 2014 -- Updated 1035 GMT (1835 HKT)
Amateur jockey Sam Waley-Cohen is perhaps best known for helping to resurrect Prince William's relationship with Kate Middleton.
March 28, 2014 -- Updated 1215 GMT (2015 HKT)
Meydan Entrance
The $10 million Dubai World Cup takes place at the Meydan Racecourse, which is a suitable setting for the world's richest horse racing day.
March 28, 2014 -- Updated 1650 GMT (0050 HKT)
He's created some of the world's biggest shows, so it's only fitting Andrew Lloyd Webber will be in the limelight on Dubai's big-money day.
March 26, 2014 -- Updated 1011 GMT (1811 HKT)
The world's richest horse race is the highlight of Dubai's social calendar, attracting 60,000 fans from around the globe.
March 20, 2014 -- Updated 1203 GMT (2003 HKT)
Former champion jockey Richard Dunwoody has gone from riding winners to traveling the world in his second career as a photographer.
March 6, 2014 -- Updated 1356 GMT (2156 HKT)
Wonder horse Frankel has retired but his $200,000 offspring are already been tipped as future racing stars -- to the delight of his jockey.
March 4, 2014 -- Updated 1313 GMT (2113 HKT)
Michael Owen arrives at Ascot 2012
How do you replace the adrenaline rush of scoring one of the greatest goals in World Cup history when your football career ends?
February 27, 2014 -- Updated 1345 GMT (2145 HKT)
A Scottish artist has captured the pomp and pageantry of Royal Ascot in a collage that represents "what I love about being British."
February 26, 2014 -- Updated 1618 GMT (0018 HKT)
CNN's Francesca Cumani meets Faleh Bogunaim -- a Qatari rider who is making a name for himself.
February 25, 2014 -- Updated 1508 GMT (2308 HKT)
CNN's Francesca Cumani explores how Qatar's royal family has impacted the global horse racing scene.
February 13, 2014 -- Updated 1436 GMT (2236 HKT)
It's been a long time coming. A very long time. But S'manga Khumalo is proving that black jockeys can hold the whip hand in South Africa.
February 7, 2014 -- Updated 1603 GMT (0003 HKT)
It needed permission from the British monarch and may anger traditionalists, but one of racing's most regal occasions has crossed the rubicon.
ADVERTISEMENT