LEXINGTON, Ky. (December 17, 2019) – A key provision that extends three-year tax depreciation for all racehorses through 2020 today passed the House of Representatives by a vote of 297-120. The racehorse provision is part of a larger tax package agreed to by Republican and Democratic leaders and now expected to be taken up by the Senate in the next several days.
Uniform three-year racehorse depreciation was among numerous tax provisions across many industries that either expired at the beginning of 2018 or this year, or were set to expire as of Jan. 1, 2020. The bill reinstates the 3-year schedule for all racehorses retroactive to 2018.
The provision allows taxpayers to depreciate, on a three-year schedule, racehorses 24 months of age and younger when purchased and placed into service, as opposed to a seven-year schedule.
“Reinstatement of three-year depreciation for all racehorses helps attract and retain investment in the horse racing industry,” said NTRA President and Chief Executive Officer Alex Waldrop. “We appreciate the House’s work to include this important provision.”
Three-year racehorse depreciation was most recently available to the industry in 2017 but Congress did not renew it for 2018 as part of the Tax Cuts and Jobs Act (TCJA) passed in December 2017. The TCJA did include 100% bonus depreciation and a $1 million Sec. 179 expense allowance for qualified depreciable property, two important investment incentives that lessened the need for three-year depreciation in many cases. However, three-year depreciation continues to be a beneficial option for many racehorse owners, especially racing partnerships with multiple passive owners, as it better aligns deductions with corresponding income opportunities on an annual basis.
Maintaining the three-year recovery period for racehorse purchases has been a top legislative priority for the NTRA federal legislative team since the provision’s initial enactment as part of the 2008 Farm Bill.
The Senate has until Friday, December 20, to pass this legislation.
As much as $17.5 million per year could be used to support Thoroughbred and Quarter Horse purses in Texas as a result of legislation signed into law last weekend by Gov. Greg Abbott.
House Bill 2463 diverts sales taxes on horse feed, tack and other horse-related products and services from the state’s general fund to an escrow account established by the Texas Racing Commission and capped at $25 million annually. No more than 70% of the funds in the escrow account may go toward purses. If the escrow account reaches $25 million, that would be an additional $17.5 million in purse money annually, virtually doubling the current amount, based on an economic study conducted by TXP Inc. consultants.
The state legislature in Louisiana approved a measure this week which would allocate $5 per start to a fund for Thoroughbred aftercare. HB384 states monies raised from the funding stream would be managed by a representative of Louisiana horsemen for withdrawals and disbursement from the Horsemen’s Bookkeeper Account.
The bill, authored by Rep. Clay Schexnayder (R-District 81), was passed unanimously by both the Louisiana House of Representatives and Senate.
The language in HB384 does allow the automatic donation to be “withdrawn or opted out of by providing written notification to the representative of horsemen in the state.”
The bill was sent to the governor for executive approval on Wednesday.
Read more about HB384, including full bill language, here.
The Horsemen’s Amendment to SB 153 by Senator Martiny was adopted unanimously. Thank you for contacting the members of the House Administration of Criminal Justice committee and asking them to support Louisiana Horsemen. A portion of the Sports Gaming conducted at our Race Tracks will now be dedicated to Purses. Communicating your position to your Representatives is vital to our industry. Through the hard work of our Members, Board, President, and Staff, Louisiana will continue to be one of the top Horse Racing destinations in North America.
Senate Bill 153 on Sports Gaming is scheduled to be heard in the House Committee for the Administration of Criminal Justice on Tuesday May 21, 2019 at 9AM. This bill does not currently dedicate any portion of the revenue to purses or breeders awards. Please contact members of the Administration of Criminal Justice Committee (listed below) and ask them to support the Horse Racing Industry by dedicating a Fair Share of the Sports Gaming Revenue at the Race Tracks to Purses and Breeders Awards. Ask them to please support the Horsemen’s amendment.
Thank you,
Louisiana Thoroughbred Breeders Association
Louisiana House of Representative
Administration of Criminal Justice
Office Address | Office Phone | ||
Mack, Sherman (Chairman) |
PO Box 115 Albany, LA 70711 |
225-567-3677 | macks@legis.la.gov |
Pylant, Steve (Vice Chair) |
805 Jackson St Suite A Winnsboro, LA 71295 |
318-435-7313 | pylants@legis.la.gov |
Bacala, Tony |
15482 Airline Hwy Suite A Prairieville, LA 70769 |
225-677-8020 | bacalat@legis.la.gov |
Bagneris, John |
5555 Bullard Avenue New Orleans, LA 70128 |
504-243-7783 | bagnerisj@legis.la.gov |
Carpenter, Barbara |
1975 Harding Blvd Baton Rouge, LA 70807 |
225-771-5674 | carpenterb@legis.la.gov |
Crews, Raymond |
4921 Shed Rd. Ste. 200 Bossier City, LA 71111-5477 |
318-716-7532 | crewsr@legis.la.gov |
Duplessis, Royce |
643 Magazine Street Suite 302 New Orleans, LA 70130 |
504-568-2740 | duplessisr@legis.la.gov |
Dwight, Stephen |
PO Box 12703 Lake Charles, LA 70612-2703 |
337-491-2315 | dwights@legis.la.gov |
Gaines, Randal |
425 West Airline Hwy. Ste. K Laplace, LA 70068-3818 |
985-652-1228 | gainesr@legis.la.gov |
Hodges, Valarie |
35055 LA Hwy 16 Suite 2A Denham Springs, LA 70706 |
225-791-2199 | hodgesv@legis.la.gov |
Howard, Frank |
1601 Texas Highway Many, La 71449 |
318-256-4135 | howardf@legis.la.gov |
James, Edward “Ted” |
445 North 12th St. Baton Rouge, LA 70802 |
225-343-3633 | james.ted@legis.la.gov |
Marcelle, Denise |
1824 North Acadian Thruway W. Baton Rouge, LA 70802 |
225-359-9362 | marcelled@legis.la.gov |
Marino, Joseph |
200 Derbigny St. Ste. 4300 Gretna, LA 70053 |
504-361-6013 | marinoj@legis.la.gov |
Moss, Stuart |
1918 Maplewood Drive Sulphur, LA 70663 |
337-625-5170 | mossstuart@legis.la.gov |
Muscarello, Nicholas |
PO Box 1523 Hammond, LA 70404 |
985-974-0009 | muscarellon@legis.la.gov |
Norton, Barbara |
3245 Hollywood Avenue Shreveport, LA 71108 |
318-632-5887 | nortonb@legis.la.gov |
For more information, please call 504-947-4676 or visit louisianabred.com.
Ahead of Saturday’s Kentucky Derby, U.S. Senators Tom Udall (D-N.M.) and Ron Wyden (D-Ore.) announced that next week they will introduce the Racehorse Doping Ban Act of 2019, which would establish consistent medication rules across the industry and strict doping penalties for horse races already governed by federal law.
“It is past time that Congress stop rewarding the horse racing industry for its inhumane doping violations with sweetheart gambling privileges and millions in casino slots subsidies,” said Udall. “This weekend, shielded from the eyes of fans, horses competing in the Kentucky Derby will be injected with painkillers before being loaded into the starting gate. With racehorse death rates higher than in any other country, the U.S. industry has completely failed to self-regulate its doping and corruption abuses. Legislation to ban doping in horseracing is the meaningful action we need to end the abuse of these iconic animals. Headlines around the country make it clear the future of this sport is in serious doubt, and this may be the last chance for meaningful reform—it’s time for industry leaders to take the blinders off.”
“It’s clear industry leaders are more concerned with their profits than protecting these iconic creatures,” Wyden said. “It’s time for Congress to step in and end the cycle of abuse by banning the cruel practice of doping in horseracing once and for all.”
While horse racing showcases the beauty of an iconic animal, chronic abuse of performance-enhancing drugs is commonplace and undermines the safety and viability of the sport. Drugged up with painkillers and performance-enhancing substances, racehorses can be pushed beyond their limits, leading to break downs with potentially fatal consequences for horses and jockeys.
Congress considered banning drugs in horse racing in the 1980s but left that decision up to individual states. As a result, almost every horse is given race-day medication — banned in other countries — and no uniform medication rules or doping penalties exist across the states. A recent New York Times report stated that the U.S. has a racehorse fatality rate that is up to five times greater than in other countries with nearly 10 horses dying a week. The scale of the tragedy was made shockingly clear earlier this year when twenty-three racehorses died in a span of three months at the famous Santa Anita Track in California, prompting the owners to close the track temporarily and consider new reforms.
Under Udall and Wyden’s legislation, the U.S. Anti-Doping Agency (USADA) – which is the official anti-doping body for US Olympic sport – would develop rules for permitted and prohibited substances and create anti-doping education, research, testing and adjudication programs for horse racing. The bill would also:
Alternative legislation has been introduced in the House of Representatives that would not specifically ban the most harmful doping practices but rather create an industry dominated panel to list approved racehorse drugs.
Udall has fought for years to reform the horse racing industry. He and Wyden sponsored similar legislation in 2013, and in 2015, following the failure of the U.S. industry to agree to meaningful reform legislation, Udall and former Representative Joe Pitts (R-Pa.) introduced legislation to eliminate the federal statute that allows most wagering on horse racing to encourage the sport to end doping and crack down on cheaters.
Some members of the horse racing community have voiced strong support for the Racehorse Doping Ban Act of 2019.
“We wholeheartedly support Senator Udall’s Racehorse Doping Ban Act of 2019. It is time for American to join the rest of the world. Horse racing is a beautiful popular sport in Great Britain, France and Hong Kong. Any type of doping is absolutely prohibited. If our country wants to join the global racing community we must get on board with this no drug policy. More importantly: our country and our horses deserve fair treatment and a fair sport. We would like to honor and commend Senator Udall for working towards this venerable goal,” said George Strawbridge, Jr and Julia Jenkins, owners of Augustin Stable.
“Roy and I have supported the Pitts, Udall Bill since it’s conception. The Racehorse Doping Ban Act of 2019-based on the Senator Udall’s 2013 bill is a well stated, well thought out comprehensive bill. It will save Thoroughbred Horse racing from extinction. It comes at the right time to offer support to the industry in the right way. Giving it guidelines and all-important protection for our beloved racehorses,” said Gretchen Jackson and Roy Jackson, owners of Lael Stables.
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