PHILADELPHIA (AP) -- Bettors wagered more than $776.9 million at the state's six horse-racing tracks last year, a 12 percent increase over 2011 that was fueled by a surge in bets from out-of-state and marks the most wagered since the state's first casino opened in 2006, according to state gaming regulators. The state's race horse fund, however, fell slightly for the first time.
The total was up significantly from $690.3 million wagered in 2011, according to the report released this week by the Pennsylvania Gaming Control Board. It was also up over earlier years, but not as significantly.
One major factor in the increase was a spike in the amount of bets coming from out of state, said Kevin Kile, the board's director of racetrack gaming.
"The vast majority of the wagers are being placed by patrons outside of Pennsylvania," Kile said Thursday. "It represents the success of Pennsylvania racing. Other states aren't seeing this."
Of the total wagered last year, $679.7 million came from bets placed out of state, an increase of 14.4 percent over 2011. Those totals have increased gradually from $605.5 million in 2008. On the other side, Kile said, wagers placed in Pennsylvania on races outside the state went down 7 percent last year.
While the money wagered on horse racing in Pennsylvania spiked last year, the report also showed that the state's Racehorse Development Fund — which is funded by slot-machine revenue and supports the horse-racing industry — declined for the first time, going down 1 percent. Nevertheless, Kile said the horse-racing industry is much better off than it was before gambling and gaming board spokesman Doug Harbach said the industry is healthy.
The once-exponential growth of slots revenue has begun to level off. The state's 11 casinos brought in nearly $2.5 billion in gross slots revenue last year, up 2.7 percent from 2011. About 12 percent of slots revenue is earmarked for the horse-racing industry; last year, more than $272 million in slots revenue was generated for the Race Horse Development Fund, with about $224 million earmarked for horse racing.
The Pennsylvania Equine Coalition, which represents about 10,000 owners and trainers in the horse-racing industry, has expressed concern about the slowdown in slots growth. The group said revenues at the racetrack casinos were down 14.3 percent in February, a decline it attributed to competition from surrounding states. The horsemen have also worried the about across-the-board purse cuts at some tracks.
"If we can't continue to maintain purse levels where they are, we are going to see the quality of the horses decrease," coalition spokesman Pete Peterson said.
The coalition also is concerned about money being diverted from the fund to other purposes. Since 2009, the state has been transferring some of the money in the fund to the general fund due to economic pressures. State officials say the money that is transferred out of the fund still goes to programs that support the racing industry, including the farm show and county fairs.
"The money is not being taken and used for roads," state budget office spokesman Jay Pagni said.
Pennsylvania legalized gambling in 2004 and opened its first casino two years later. It uses casino revenue to support the state budget, public schools, civic development projects, volunteer firefighting squads, local governments and the horse racing industry.