$5M Assiniboia Downs funding cut will cost jobs, lawyer says

The provincewants to transfer money "from horses to hospitals" by slashing the amount of money it gives to the Manitoba Jockey Club, but the club says the move will cost hundreds of jobs.

The provincial government has introduced legislation that, if passed, would reduce its subsidy to the jockey club, which runs the Assiniboia Downs racing track, by $5 million a year.

"We're transferring $5 million from horses to hospitals," Steve Ashton, the minister responsible for lotteries, told reporters on Thursday.

To do that, the province wants to slash its subsidy to the club, under the Pari-Mutuel Levy Act, by 15 per cent. As well, it wants to eliminate its special video lottery terminals (VLT) agreement with the jockey club.

According to the province, Assiniboia Downs currently keeps 100 per cent of the revenue generated from the 140 VLTs it has.

The province wants to change that so that the Downs would be subject to the same VLT commission structure as other restaurants and bars that have the gaming machines.

"The current agreement with the Manitoba Jockey Club is simply not good for Manitoba taxpayers," Ashton stated in a news release.

"We believe the right thing to do in these uncertain economic times is to redirect funding from horse racing into priorities like health care and education."

The legislation is part of Bill 47, the proposed budget implementation and tax statutes act, which would implement parts of the NDP government's 2013 budget.

The Manitoba Jockey Club is embroiled in a legal battle with the Manitoba government and the Red River Exhibition over the future of Assiniboia Downs.

Earlier this spring, the club slapped the provincial government with a multimillion-dollar lawsuit over the proposed budget changes. That case is still before the courts.

However, the province's bill proposes "legal protection for taxpayers against civil claims" brought by the Manitoba Jockey Club, meaning the club cannot sue the government over those changes.

"We are not going to leave taxpayers on the hook as we end this agreement and offer the jockey club the same share of VLT revenue that other businesses receive," Ashton said.

Officials with the Manitoba Jockey Club could not be reached for comment on Thursday.

1,000 jobs in danger, lawyer says

Jeffrey Rath is a Calgary-based lawyer representing the Manitoba Jockey Club. Rath said the governments bill will put 1,000 jobs at risk this summer.

Rath said the move is political, as the Winnipeg Jets receive subsidies from the province.

Rath said the move takes "the $5 million away from the jockey club to allow the Jets to subsidize $5 million annual salaries for hockey players at the expense of 500 direct jobs at the Manitoba Jockey Cluband at least 1,000 jobs in the Manitoba agricultural community."

The Manitoba Jockey Club will now apply for interim relief to avoid bankruptcy, and Rath said the club is planning to move forward with civil action.