Gov. Tom Wolf recently announced a plan to finance a student scholarship by tapping a protected horse racing trust fund. On Tuesday, it became clear that a major member of the horse racing industry was not consulted by Wolf or his staff prior to the budget proposal going public.
Russell C. Redding, Pennsylvania’s Secretary of Agriculture and chairman of the state’s horse racing commission, learned of the proposal along with everyone else listening during the governor’s annual budget address to the Legislature on Feb. 4.
Redding, a veteran cabinet member who has served in two different administrations as the Agriculture Secretary, made the eye-opening revelation exclusively to PlayPennsylvania following a meeting of the racing commission Tuesday in Harrisburg.
Commissioners reject Wolf’s plan to tap trust fund
While Redding abstained during the vote, his fellow commissioners passed a resolution rejecting the governor’s proposal. However, they also said they support the concept of better supporting students and the state’s higher education system.
As Secretary of Agriculture, Redding has general oversight of the horse racing industry in the Keystone State.
As chairman of the racing commission, Redding plus nine commissioners are charged with promoting the horse racing and breeding industry in the Commonwealth. Their efforts are paid for by the encumbered trust fund.
Betting on students, instead of horse industry
During his budget address, Wolf said moving $204 million from the Race Horse Development Fund would benefit 25,000 students at state colleges. The money comes from a dedicated percentage of slot revenues – about 10% – from brick-and-mortar casinos.
That came to about $242 million in 2018.
PA casino slots have funneled more than $2.5 billion to the racing industry. Pennsylvania’s financial support is extreme but not unique among states in the US.
Wolf’s applause line in support of his proposal during his speech was:
“Let’s bet on our kids instead of bankrolling race horse owners and ensure the viability of the Pennsylvania State System of Higher Education.”
But the governor made no mention of the fact the money is protected by a 2017 law that shielded the funds in a lockbox trust fund. The Legislature approved the trust fund status because of previous raids on the fund.
The trust came about during Wolf’s time as governor.
Governor seemed unaware of the implications of a trust fund
Astonishingly, Redding said, “I don’t think so,” when PlayPennsylvania asked if the governor or his staff appeared to understand what it meant that the monies in question were secured in an encumbered trust fund.
Breaking into a trust fund would require amending the law which established it, which would mean garnering bi-partisan support.
Republicans are not going to support taking money from what is in large part an agricultural program, as many have made clear.
Redding told members of the horse industry they need to tell their story about their economic impact. The industry says it is responsible for 23,000 jobs, plus a large amount of open space.
One commissioner suggested a direct meeting between Wolf and the racing commission.
Expect more discussion during budget hearings Wednesday
Redding said he would convey the sentiments of the commission and the horse industry during agricultural budget hearings set for Wednesday.
The secretary said Wolf’s scholarship proposal “will play out in the budget hearings.”
His fellow commissioners “are on the record clearly” opposing funding the program with trust money.