Report: It’s time for Pa.’s horse racing subsidy to be put out to pasture | Friday Morning Coffee

May 28, 2021 7:13 am

Good Friday Morning, Fellow Seekers.

Underwriting the Sport of Kings isn’t paying off for Pennsylvania taxpayers, and that money could be better spent on shoring up state spending on education, either at the PreK and K-12 levels, or at the state System of Higher Education, education advocates argue in a new report.

Pennsylvania taxpayers spent $3 billion since 2010 supporting the industry, through the Horse Racing Development Fund, even as attendance has dropped and fewer horses are bred in the state each year, the research by Education Voters of Pa., a progressive-minded advocacy group, concluded. The industry’s subsidy is one of the most generous in the nation, finishing second to only New York, according to the report.

At the same time, enrollment has slumped at Pennsylvania’s 14 state-owned universities, as state support for higher education has declined, putting it in the bottom six nationwide, according to an analysis by the Center on Budget & Policy Priorities.

In 2019, for instance, state system students received $5,739 in state subsidies, while the per-horse rate totaled $15,271, according to the Education Voters of PA report.

The schools are now so cash-strapped that the system has announced plans to merge six of 14 campuses into two mega-universities, the Capital-Star’s Stephen Caruso reported.

“Pennsylvania’s horse racing industry has a storied history—but it’s not a good story,” the Education Voters of Pa. report reads. “Over the last 15 years, Commonwealth taxpayers have provided more than $3 billion in subsidies to the industry on the premise that racing is vital to Pennsylvania’s agricultural and tourism industries. In fact, racing is a small and declining industry that generates little economic impact and little public interest. The beneficiaries are a small number of racing enthusiasts and hobbyists who have profited from public investment while avoiding public scrutiny.”

A spokesman for the industry defended the generous taxpayer support, arguing to WHYY-FM in Philadelphia, that cuts would ripple across the state’s economy.

“You don’t address one debt problem by putting an entire industry out of business,” Pete Peterson, of the Pennsylvania Equine Coalition, said.

Shippensburg University in Cumberland County, Pa. (Image via Flickr Commons)

As the Capital-Star’s Cassie Miller reported in AprilGov. Tom Wolf is taking another run this budget season at rerouting the industry subsidy into a scholarship program for students enrolled at State System of Higher Education schools. The Democratic administration wants to devote $200 million of the $239 million currently earmarked for the industry, leaving a still generous $39 million in subsidies.

The “Nellie Bly” program, named for the famed investigative reporter and Armstrong County native, will be available to in-state and out-of-state students. As it’s currently proposed, it will cover the full cost of tuition up to six years for full-time students, Miller reported.

Scholarship recipients will be expected to stay in the commonwealth for time equal to the number of years they received the funds. If they leave early, the grant turns into a loan with “reasonable interest” that recipients will be expected to repay.

About 25,000 low- to middle-income students are expected to benefit from the program. Administration officials said they anticipate the fund to be a recurring source of aid for students in need, prioritizing Pell Grant and Pennsylvania Higher Education Assistance Agency aid recipients first.

Twenty years ago, Pennsylvania students covered an average of 41 percent of their college costs, WHYY-FM reported, citing data compiled by Association of Pennsylvania State College and University Faculties, the union that represents state system faculty. By 2016, that rate had risen to 73 percent, the station reported.

In 2018, the average net price of a four-year public university devoured 34 percent of a Pennsylvania family’s median income, according to the Center on Budget Policy & Priorities analysis. Among Hispanic families in the Keystone State, the rate was 48 precent. And Black families in Pennsylvania could expect to spend 56 percent of their median income on a four-year public university, the analysis showed.

Given that bleak topography, the Education Voters of Pa. report offers a stark choice: “Policymakers have to ask themselves what the better investment is in Pennsylvania’s future: horses that race for four years or students whose education lasts a lifetime,” the report reads.

Pennsylvania State Capitol Building. (Capital-Star photo by Cassie Miller.)

Our Stuff.
The Keystone State is swimming in federal stimulus money. But the debate over how to spend $7.3 billion in assistance has quickly — and predictably — cleaved along party linesMarley Parish and Stephen Caruso outline the state of play.

Pennsylvania is on track to fully vaccinate 70 percent of adults by the end of June, meaning the most visible reminder of the COVID-19 pandemic — masks — will soon become optional, Marley Parish reports.

Pennsylvania state Treasurer Stacy Garrity, a Republican, has joined with other GOP state treasurers warning banks that they risk losing billions of dollars in public funds if they refuse to lend to fossil fuel-based industries, Stephen Caruso reports.

Duolingo founder Luis von Ahn, a Pittsburgher and immigrant, is putting his app to work fighting illiteracy in his native Central America. He and other corporate leaders met with Vice President Kamala Harris on Thursday to address the root causes of immigration, Correspondent Kim Lyons reports.

The top brass at the Philadelphia Police Department say they’re worried about a spike in gun violence this summer, our partners at the Philadelphia Tribune report.

On our Commentary Page this morning, opinion regular Mark O’Keefe considers whether voters’ rebuke of Gov. Tom Wolf at the polls last week signals rough sailing for Democrats in 2022. And Rep. Margo Davidson, of Delaware County, the ranking Democrat on the House State Government Committee, says the U.S. Senate needs to pass a landmark voting rights bill to backstop efforts by Democrats in the Keystone State.

En la Estrella Capital: A partir del 18 de Julio, los desempleados de Pa. deben probar la búsqueda de trabajo para recibir beneficios de desempleo. Y los Republicanos de la Cámara de Representantes promueven proyectos de ley para restringir la salud reproductiva y ampliar los derechos de armas.

School District of Philadelphia Superintendent William Hite speaks during a news conference Wednesday, March 18, 2020, at City Hall (Photo via The Philadelphia Tribune)

Philadelphia’s high schools should start later,
 city schools Superintendent William Hite has said, the Inquirer reports.
If you’re flying over the Memorial Day holiday, here’s what you can expect at Pittsburgh International Airport, the Post-Gazette reports.
LancasterOnline records the history of a particularly dangerous Lancaster County intersection.
A school board in Luzerne County didn’t fill a slot on the board because they’re unsure about whether the person holding it has died, the Citizens’ Voice reports.
Some state lawmakers and advocates say the state has to increase its efforts to vaccinate communities of color, WHYY-FM reports.

Here’s your #Pennsylvania Instagram of the Day:

Democratic incumbent Joe Schember has won the Republican write-in vote for Erie mayor, GoErie reports (paywall).
Republicans, including U.S. Sen. Pat Toomey, R-Pa., have rolled out a $928 billion counter-offer on infrastructure funding, WESA-FM reports.
An internal poll, released by Sen. Doug Mastriano, R-Franklin, shows the likely GOP gubernatorial candidate in a statistical dead heat, 19-16 percent in a head-to-head match with ex-Congressman Lou Barletta. Nearly half of respondents remain undecided, PoliticsPA reports. 
Capitol Hill staffers caught in the crossfire on Jan. 6 remain angry over the GOP’s refusal to support a commission to get to the bottom of it, Roll Call reports.

If You Read Nothing Else Today …
… that isn’t one of our stories, this history of Pittsburgh’s Chinatown neighborhood by our good friends at The Incline is an absolute must-read. Only one business from the original neighborhood, the Chinatown Inn, remains. And it was only this year that the Steel City’s original Chinatown was granted its state historical marker from the Pennsylvania Historical and Museum Commission, the Incline reports.

Gov. Tom Wolf 
holds a 10:30 a.m. virtual news conference with U.S. Sen. Bob Casey, D-Pa., and officials from Wisconsin discussing the success and importance of Medicaid expansion in the state.

Heavy Rotation.
Here’s a pop gem from The Gin Blossoms, written with pop legend Marshall Crenshaw, for the ‘Empire Records’ soundtrack (itself a ’90s cult gem). It’s ‘Til I Hear It From You.’

Friday’s Gratuitous Hockey Link.
It was a big night for playoff hockey on Thursday. Montreal fended off elimination, beating Toronto 4-3 in overtime, keeping their post-season hopes alive. And after a tough series, Carolina eliminated Nashville, beating the Preds 4-3 in another overtime win.

This newsletter will be off Monday for the Memorial Day Holiday. We’ll be back to regular business on Tuesday, June 1. Have a great weekend. And while this holiday is intended to honor those we have fallen in war, I hope you’ll also take a moment to remember all those we’ve lost during this terrible, but transformative, 14 months.

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John L. Micek

A three-decade veteran of the news business, John L. Micek is the Pennsylvania Capital-Star's former Editor-in-Chief.