As a rule that does not require a RFA, RAFA or JIS, this rule will be initially reviewed in the calendar year 2025, which is no later than the 5th year after the year in which this rule is being adopted.

The New York Thoroughbred Breeding and Development Fund (Fund) received public comments in support of and opposed to the proposed rule change. The comments in support of the rule change included the following:

Two brief general statements were received in favor by representatives from farms.

A veterinarian and owner outlined the benefits of the new rules, namely New York boarding farms increasing income by boarding pregnant mares and the benefit to the health of foals of mares being transported when the foals are older. The comment also noted that this individual believes that there should not be a minimum price for broodmares to be considered a New York resident when being brought into the State after purchase at auction.

The executive director of the New York thoroughbred breeders’ organization and two representatives of breeding farms commented on the necessity of New York restocking its resident mare population by removing artificial barriers to bringing mares into the State, in turn continuing a supply of horses for State-bred races. These comments stated that allowing breeders to purchase mares at public auction and include the foals as New York-breds so long as certain qualifications are met would ensure these mares and their breeders have proper investment in the New York breeding and racing program. The commentator believe that this proposal will benefit racing and New York agribusiness and employment opportunities therein.

A veterinarian, breeder/participant and board member of the New York thoroughbred breeders’ organization commented in favor of removing barriers to entry into the New York state-bred program, noting support for the minimum broodmare price to ensure quality with a suggestion to revisit this requirement in the future to consider adjusting the amount upward.

The New York Racing Association (NYRA) commented in favor of the rule change, noting the expansion of the population of thoroughbred mares and subsequent foals in New York stemming from allowing the foals of broodmares purchased at public auction to be included as New York-breds so long as certain qualifications are met. The statement further noted the necessity of the change to compete with neighboring states and to support the State’s agricultural industry as well as assisting NYRA in its best efforts to run 600 New York-bred races each year.

A representative of a breeding farm noted that the change is necessary to allow New York to remain competitive in the commercial marketplace, stating specific support for the mares from public auction having eligible foals if certain conditions are met, allowing mares to be out of state longer so that foals are older before the mare returns to New York, allowing the calculation of the time period a mare must stay in the State to begin on arrival, and support of the stallion population.

The comments opposed to the rule change included the following:

A veterinarian stated that while the quality of horses would increase, the stallion population would decrease with the rule change. The comment further noted that the minimum price limitation on broodmares would discriminate against small breeders. This commentator believes that the key is finding consumers interested in coming to New York to race where a number of the horses he has sold have gone out of State.

A representative from a breeding farm stated that the rule change provides no benefit for smaller New York breeders who breed and raise their horses in New York who then have to compete against high-priced out-of-state sires’ progeny. This commentator believes the changes are designed for the wealthy investors breeding to out-of-state sires and the big boarding farms. The commentator states that there should be an incentive or reward for New York farms and breeders, something to provide more opportunities for New York-sired horses or those who have lived their whole lives in New York or to allow an opportunity to capitalize on the mission to keep green space. The commentator suggests a weight allowance, a new or different condition or a greater percentage of the purse as examples of incentives.

A comment was received against the broodmare minimum-price limitation and increase in out-of-state days permitted, noting that the commentator does not believe these changes promote the Fund’s mission. The commentator notes that the threshold for broodmares purchased at auction should not be their purchase price, but rather their “page.” The commentator believes that expanding the New York breeder base will encourage individuals who want to minimize risk and need financial incentive. The commentator believes a better way to support the Fund’s mission is increased communication regarding the advantages of purchasing a New York-bred horse and regarding advantages of racing in New York and eliminating the breed-back provision or providing an opt-out policy that is more advantageous to all stakeholders.

A comment from a breeding farm representative stated that the $50,000 minimum purchase price is a poor indicator of mare quality, giving multiple anecdotes as examples. The commentator believes that the minimum purchase price for broodmares will discourage people from entering the industry and that New York stallions are unlikely to achieve levels of commercial viability for their foals as compared to Kentucky sires and further speaks out against the breed-back policy as a whole. The commentator believes that the rule changes do not address the problem of lack of New York-bred horses to fill races.

These comments were analyzed and considered by the Fund’s Board members as follows:

Small Breeder Concerns and Mare and New Foal Crop Declines: Several Board members noted that a few of the comments in opposition to the proposed rule claimed that the rule, if adopted, would make it more difficult for the smaller breeders in New York to compete. It was noted, however, that the rule would not materially change any of the existing rules or requirements for breeding New York-breds; rather, it would simply provide for greater flexibility to incentivize certain high quality mares into New York that otherwise would not enter into the State for breeding. Small breeders would still have the same opportunities to breed New York-breds as they currently do under the existing rules. It was noted repeatedly that New York is facing a significant and ongoing decline in its mare and new foal populations and that this rule change is designed to address those concerns. It was noted that the NY foal crop has declined in recent years and it is anticipated that there will be another decline in 2021. Fewer mares would mean fewer boarders at New York farms and a decline in associated agribusiness such as hay and grain purchase.

It was also noted that the $50,000 price point for the public auction mare was determined after canvassing both breeders and stallion owners to understand the level at which encouraging non-resident mares into the State will positively affect the mare and new foal numbers without adversely affecting the stallion industry. Several Board members noted that the new rule, if adopted, would provide flexibility in determining the proper price point of public auction mares to achieve the objectives of the industry.

Impact on Stallion Industry: Several commentators stated that the new rule, if adopted, would adversely impact the stallion industry, noting that it would likely lead to a decrease in the New York stallion population and a perception that the quality of stallions in New York will decline. These comments were considered and it was noted by one Board member that New York breeders need to support New York stallions in order for the stallion industry to thrive. However, that same Board member, who is a stallion owner, stated that he has canvassed many of the stallion owners in New York and that they support the new rule as it will likely lead to higher quality mares into the State. He noted, however, that if the price point drops below the current figure, that would not be beneficial to the stallion industry in New York.

Desirability of New York stallion offspring: An additional benefit of the new rule, if adopted, would be that one year after the adoption of the rule, the Fund and NYRA have agreed to spend up to $650,000 annually to provide a $5,000 purse bonus to the owners of New York-sired New York-breds at NYRA tracks. It is hoped that the owner bonus will add to the attraction of owning a New York-sired racehorse.

Significant Alternatives Suggested: While the Fund received four comments in opposition to the new rule, none of those comments contained any significant alternatives for the Board’s consideration. One commentator suggested that instead of adopting this new rule, the Fund should consider various ways to provide better incentives or rewards for New York farms and breeders or to enhance purses for New York bred races. The Board considered all of the public comments made by the commentators, including the comments made in support and in opposition to the measure, and determined that there was no basis to consider any alternatives to the rule as drafted.

As a result, no changes to the proposed language were made.