Public Hearing - Pennsylvania Horsemen and Breeders May 14, 2003 James Simpson, Hanover Shoe Farms Good morning. Thank you for the opportunity to speak with you today. My name is Jim Simpson and I am the President of Hanover Shoe Farms, the largest winning standardbred horse-breeding farm in the world. I am here today on behalf of the Standardbred Breeders Association of Pennsylvania. Sitting with me is Paul Spears, chairman of the Standardbred Breeders Association of Pennsylvania and Max Hempt, of Hempt Farms, one of our board members. Hanover Shoe Farms has been breeding standardbred horses since 1926. People from all over the globe seek out our horses to compete in world-class harness horse racing. We believe the horseracing industry in Pennsylvania begins with us. Standardbred horses are a dominant agribusiness in Pennsylvania. There is probably one standardbred-breeding farm in nearly every Senatorial district, as there are some 400 plus breeders across the Commonwealth. Pennsylvania was once the standardbred capital of the world. And it can be again. We can be the Keystone to live harness horse racing in the entire northeastern United States if our legislature is willing to invest in Pennsylvania businesses -- our breeders. Hanover Shoe Farms located just south of here and is over 3,000 acres located in rural Adams County, PA. This is prime green space that has been conserved for more than three-quarters of a century because of our love for our horses, our land, our employees and the communities we serve. Standardbred breeders across the state maintain hundreds of thousands of acres, tens of thousands of jobs, and hundreds of millions of dollars invested in our state agribusinesses. The annual sale event of standardbred horses at Pennsylvania's Farm Show Complex in November has become the largest in the world, attracts thousand people and contributes more than 12 million tourism dollars into the local economy. Our main farm accommodates busloads of thousands of tourists visiting and touring our farm each year. Many tourists include a stop to our farm as part of their historic Gettysburg vacation itinerary. Hanover Shoe Farms invests about $8 million a year into its rural community. The tourists are attracted our rolling acres of farmland that has remained relatively unchanged since the turn of the last century. The problem is, this breeding operation doesn't generate more than $8 million a year. Last year alone several prominent breeders sold their farms in central PA to make way for more shopping malls and housing complexes. It is the loss of green space and sprawl that concerns environmental, agricultural and tourism interests in Pennsylvania. While surrounding states offer larger purses and greater incentives to standardbred breeders, we are continually pressured year after year with poor returns and no dividends to our shareholders. Many breeders are currently expanding their breeding operations out of state. Even Canada, with its lower exchange rate, offers more of an incentive for us to breed and race our horses there than in our own state. We believe the standardbred breeding farms across Pennsylvania, and the rural way of life they support, are worth preserving. We are hoping that the legislature will agree with us that we should find a way to keep our farms from eroding and instead provide an incentive for commercial investment expansion. Pennsylvania's standardbred horse breeders' investments and competitive skills directly impact the 35,000 jobs that racing in Pennsylvania supports. We believe a reasonable allocation of the industry revenue is necessary for the standardbred industry to maintain their farms and produce high quality racehorses to support harness racing. While we are watching a decline in return on investment in our capital facilities and prime farmland. We believe that the tourism industry will agree with us that the economic failure in this matter will also have an adverse impact on tourism. The situation could have long-term effects on the standardbred breeding farms across our state. The slots legislation needs to assure purses are competitive and that there is enough revenue support to keep horse breeders profitable. Some race stakes will attract horses to Pennsylvania from all over the northeast; other races favor winning horses that are bred in Pennsylvania. Most observers agree both allocations are necessary to boost harness racing in the state. The question is, how do you get a fair distribution of these small percentages of revenue? How do you find balance? To keep live horse racing a vital source of tax revenue in PA, the breeders need additional revenue to continue to produce quality horses, which is an important ingredient in the state's racing industry. We thank the committee for this opportunity to present our views.
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