Maryland's horse industry hasn't recovered fully from years of decline but has regained its footing and is generating more than $1 billion a year — 23 percent more than in 2010, a study released Monday found.
The study, conducted by the Sage Policy Group, said the industry's nascent rebound appears to be accelerating.
"The last five years have represented a stark contrast from the prior three decades when Maryland's horse industry was in decline," said the study, paid for by the Maryland Horse Breeders Association and a dozen other industry partners.
The study, released at Goucher College — which is building a new equestrian facility that soon will be the new home of the breeders association — quantified the extent of the industry's recovery and its ripple effect on the state's economy.
The industry's economic impact grew from $930 million in 2010 to $1.1 billion last year, when it supported the equivalent of about 9,100 full-time jobs with compensation of about $482 million, the study said. At the current rate of expansion, researchers said, the industry could have a $1.5 billion annual impact by the end of 2020 and support more than 11,000 jobs.
Mike Pons, co-owner of Country Life and Merryland farms, said he began to notice a change "when we brought the first of our new stallions back in 2012." Before that, he said, owners had been sending their mares mostly to Pennsylvania, West Virginia and other states to give birth.
He estimates revenue from horse boarding is up 40 percent since 2012 at the two farms, which collectively have more than 100 horses and almost 300 acres, much of it rolling pastures, in Harford and Baltimore counties.
"We always had the infrastructure, we just didn't have the dollars" in the state, Pons said.
The study looked at all aspects of the horse industry, which encompasses breeders, trainers, auctioneers, farriers, farm managers, tack and equipment makers and many others. It examined recreational riding and services to racing, such as veterinary work, but did not include spending at racetracks. Sage Policy Group wrote the report based on a survey of 700 industry stakeholders.
But the recovery hasn't led the industry all the way back to where it was in the early 2000s.
"Despite the uptick in activity in recent years, Sage estimates that industry spending remains 13.5 percent below its 2002 level," the study said. "If one adjusts for inflation, that figure rises to more than 34 percent. In other words, Maryland's horse industry is still healing."
And questions remain.
"I think the picture is much better than it was, but I'd still say it's guarded," said Timothy Capps, director of the Equine Industry Program at the University of Louisville.
Capps, former executive vice president of the Maryland Jockey Club, which owns the Pimlico and Laurel Park tracks, said questions remain about where the industry goes in the future since the tracks did not secure casino gambling.
While gambling didn't go to the racetracks, the state does subsidize the horse racing industry with a percentage of casino slot machine revenues. Under legislation approving slots gambling in 2008, 7 percent of the revenue goes toward track purses and incentives for in-state thoroughbred breeding and another 2.5 percent goes into a racetrack facilities fund.
Before gambling came to the state, the study said, slots programs in Delaware, Pennsylvania and West Virginia "had tilted the competitive playing field away from Maryland."
Gambling on horse racing is also down nationwide at U.S. tracks, falling from a high of $15.2 billion in 2003 to $10.6 billion in 2015, according to Jockey Club figures cited in the study.
The state was hit with a "double whammy," said Ross Peddicord, director of the Maryland Horse Industry Board, a state Agriculture Department group aiding the industry.
"The 2008 recession hurt the nonracing disposable income, with people buying less, going to less shows, buying less-expensive show horses," Peddicord said. "And then there was the proliferation of the casino gambling in neighboring states."
But it didn't take long after the casinos started opening for the effects of the new funding to be felt, according to the study.
"What's really remarkable is the fact that the industry has turned around so quickly," Anirban Basu, Sage Policy Group's chairman, said in an interview. "What people are doing now is a lot of deferred maintenace. And they are, of course, breeding more horses."
The recent success of breeding operations is an important component of the industry's revival.
In 2010, the study said, 20 standard-bred mares were bred in Maryland. By 2014, the number had risen more than 12-fold to 250. In 2015, the state's thoroughbred and standard-bred foal numbers were the highest in several years.
Still, there is a tenuous quality to the industry's resurgence. The industry worries the legislature could shift racing's cut of slot machine revenues to other projects.
The breeders association's release about the study said that while spending on equipment, personnel and physical structures is rising, "it would grow even more quickly if there was less uncertainty about the state's commitment to the current slots funding formula."
Sage Policy Group conducted a separate study in 2015 asking people in the industry to assess their economic prospects, "and they said their leading concern was that this formula would change," Basu said in an interview.
The House chair of the joint gaming committee in Annapolis said Monday he doubts the formula will shift anytime soon.
"I think there are some legislators who feel the money should be redistributed, but the general consensus is the industry is doing well and this is working," said Del. Eric Luedtke, a Montgomery County Democrat.
While the study didn't include the impact of racetrack operations, it noted that the Preakness — which reported record attendance of 135,256 last May — generates more than $30 million each year. Officials with the Stronach Group, which owns the Maryland Jockey Club, have suggested the possibility of moving the Preakness to the refurbished track in Laurel.
Capps said questions about the future of outdated Pimlico hover over the industry. The Maryland Stadium Authority is studying Pimlico's condition, and the results are expected to help the owners decide what to do with the facility.
But for now, Capps said, the trend in Maryland "is up, and that's not the case everywhere in terms of people coming out of a recession."
The state's industry "has managed to turn it around, and right now they've got a story to tell," he said.