The Ohio Study Commission on the Future of Gaming recently released its report on Buckeye State gambling, revealing a struggling Ohio horse racing industry as a primary topic of focus.
Interest in horse race betting has waned in recent years amid thriving legal sports betting and casino gambling markets. Online casinos and iLottery could also soon become legal in Ohio.
As gambling continues to grow, many feel that Ohio horse racing and racinos have never been more at risk. The commission’s report details that fear and the potential actions that could be taken to revive the struggling industry.
Study Commission report highlights Ohio horse racing struggles
Many stakeholders submitted ideas via written testimony, ultimately resulting in no consensus solution for the struggling Ohio horse racing industry.
Currently, there are seven commercial racetracks in Ohio that host three different types of races:
- Standardbred Harness Racing
- Thoroughbred Flat Racing
- Quarter Horse Flat Racing
Ohio horse racing, which employs 17,000 full-time employees, has an economic impact of roughly $1.3 billion on the state. In 2023, Ohio hosted 2,385 Thoroughbred races and 6,658 Standardbred races. Additionally, about 40,000 horses are involved in Ohio horse racing, an industry overseen by the Ohio State Racing Commission.
Unfortunately, despite great potential for Ohio horse racing success and the swath of large numbers, the industry is struggling. Senator Nathan Manning highlighted the need for solutions in his testimony, saying:
“In the next 5-10 years, the horse racing industry will likely continue in their struggle to remain a lucrative gaming sector. The General Assembly should continue to keep an eye on this industry, acknowledge its struggles, and look for solutions.”
In remarks prepared by the Ohio State Racing Commission, the commission explained that most of its funding comes from pari-mutual taxes, which have been consistently slipping year over year.
“Our funding is substantially based on the revenues from the pari-mutuel tax, which is in steady decline, in fact experiencing an average 19% drop in the last three years. A new formula or supplemental funds may need to be explored to offset these shortfalls.”
Ohio stakeholders discuss options for increased horse race funding
Ohio Senator William P. DeMora agreed with the findings of the Ohio State Racing Commission, proposing a change that could help:
“First, we must ensure that Ohio’s storied horse tracks can remain profitable. Ohio has some of the most historic tracks in the nation, but they risk falling into obscurity due to small purse sizes and limited racing. To remain relevant, thoroughbred tracks would need to open up evening cards to draw in larger crowds and, as such, increase purse sizes.”
There was no clear pushback to that idea, but the rest of the proposals had plenty of adversaries.
Fellow stakeholders proposed helping Ohio horse racing by legalizing iGaming and tethering the licenses to land-based casinos and racinos. PENN Entertainment, MGM Resorts, and Boyd Gaming, which combine to operate four of Ohio’s seven racetracks, heavily favor online casino legalization.
Other racino operators, such as JACK Thistledown Racino, are heavily against expanded gaming of any kind. These operators already have minimal market share and lack an online casino platform. The Study Commission’s Ohio online gambling report suggests that iGaming could become a reality before long.
Testimony contributors also discussed the idea of permitting racinos to offer live-dealer table games, video poker, and other electronic table games. The goal, operators and stakeholders said, is to modernize racino offerings outside of horse racing so that racinos can better compete with commercial casinos.
County fair racing issues complicate Ohio horse racing discussion
One of the biggest pressure points in the Ohio horse racing industry is the collective confusion around how to regulate country fair horse racing events.
A trio of Republican state representatives — Jay Edwards, Jeff LaRe, and City Abrams — submitted testimony recommending that the guidelines for county fair racing be updated.
“One point of future clarification that also may be needed to the Ohio Revised Code under ORSC is around who runs the horse racing at county fairs. Such confusion has caused safety concerns with the Commission due to the overlapping authority discussed during the hearings.”
Senator Bride Rose Sweeney recommended creating a task force to better regulate county fair horse racing:
“The legislature should establish a task force encompassing the various partners to examine county fair racing and identify solutions to clarify jurisdiction, ensure safety and benefit all participants in these events. The legislature should consider increasing fines for egregious or repeat violations of horse racing laws.”
The Ohio State Racing Commission also offered a recommendation to help solve the oversight issue. It proposed deterring nefarious activity with a 10x increase in the potential fine for extreme offenders.
“The second issue we need to address is the Ohio Revised Code limits the amount of fines for top level offenders to $1,000.00 dollars and one year suspension . . . It falls woefully short of being a deterrent in the current standard of racing. We are suggesting the fine be raised to $10,000.00 dollars for extreme offenders.”
According to its testimony, real improvement will not be possible until the Ohio State Racing Commission receives more funds.
“Should funding of the commission change, a more active role could be expected. A key reason for the diminished oversight is the current formula for the funding of the OSRC.”
This will be the case regardless of whether or not any further changes occur, according to the OSRC.
