Virginia Horse Racing Study Shows Steady Economic Growth

The Virginia Equine Alliance recently commissioned a study of the Virginia horse racing industry and its impact on the local economy. The group works to promote the racing and breeding elements of the sector and wanted to check to see how the industry has developed, if at all. The results of the study are now in, and positive signs were revealed. The industry has seen growth and development over the past few years, with an estimated economic impact in 2019 of just over $542 million.

The study was conducted by Chmura Economics and Analytics, a researching consulting firm located in Richmond. In general, the study proved that the industry had made great strides since reaching a tipping point in 2014.

Virginia Equine Alliance Executive Director John Hannum commented on the study and the industry, pointing out that jobs are coming back, and horse racing expenditures are up. Overall, tax revenues are increasing for the state from the industry.

Hannun pointed out that racing hit a low point back in 2014 after the Colonial Downs racetrack shutdown. The General Assembly took steps to help horse racing industry soon after, including approved Historical Horse Racing machines in 2018. This change allowed the track to reopen, and it was the start of the revitalization of horse racing.

Details of the Study

Several key points were made in the study, all indicating that the recovery process continues. In 2019, the overall economic impact came in at $542.1 million. The horse-related expenditures for the horsemen in the state for that year were just over $239 million. The state tax revenue at the time came in at $26.5 million.

The racing events and spending by visitors to Virginia totaled over $68 million in 2019. Employment conditions have improved, with over 5,000 jobs connected to the industry two years ago. The study showed that the average amount spent by horsemen to train, care, and board a racehorse comes in at just over $14,600.

Virginia Secretary of Agriculture and Forestry, Bettina Ring, is pleased with the study results as it shows the state continues to be an area where the horse industry can thrive. Ms. Ring said:

“The Commonwealth has a rich history of breeding and racing Thoroughbreds, from even before the days of Triple Crown-winning Secretariat from Caroline County and continuing to today. The industry is an important part of our agriculture economy, especially in rural parts of Virginia. A successful horse industry means that more farms remain economically viable, which in turn makes it easier to maintain and conserve productive farmland throughout the Commonwealth.”

The findings of the study are likely not revealing the full impact of the industry. Colonial Downs was only open nine months that year, and there were only 18 race days. The racing days are expected to double, and with the venue open year-round, the economic impact should be much more significant.

The COVID-19 Impact

The horse racing industry in Virginia will likely overlook 2020 when it comes to the economy to a certain extent due to the COVID-19 pandemic. The sector was hit hard by the virus in the United States, as most races were canceled due to lockdown efforts. With months of zero racing, the industry was unable to function and bring in any income and revenues for states in which venues operate.

As lockdown restrictions eased, jockeys and owners were ready to get back to work. However, racecourses were short of spectators due to continued social distancing needs, which left the horse racing industry vulnerable.

This year, the industry should begin to see a recovery period. The vaccination process is in full swing, with more and more people receiving a vaccine daily. Restrictions continue to ease across the country, and events should be up and running now or in the coming months.