About 7% of the Horseracing
Integrity and Safety Authority’s annual budget is being held up in a $5.8 million fee dispute with the New
York Racing Association and Churchill Downs Inc., according to the federal regulator’s
website.

The two racetrack giants filed a lawsuit Wednesday
challenging HISA’s right to change the way HISA figured out their fees. The
authority said in its documents that NYRA is $3.9 million behind on its
payments and CDI $1.9 million.

Churchill Downs, NYRA file federal case against HISA.

The figures were reported first by Daily Racing Form,
which was told by HISA that the $5.8 million owed by NYRA and CDI has been
partially offset by the authority being $3 million under its projected $80
million budget for 2024.

Consistent with its response to the new lawsuit, HISA told DRF
that on-time fees are “critical to ensuring HISA is adequately funded” for its federally
mandated mission to regulate horse medication and improve racetrack safety.

In the lawsuit filed in federal court in Louisville, Ky., lead
plaintiff Churchill Downs was joined by NYRA in saying HISA should not have
been allowed to change the original fee structure based entirely on the number
of starts hosted by the racetrack owners. Instead, they were billed under a 50-50
formula split between starts and purses. Since NYRA and CDI offer more prize money
than most other jurisdictions, their fees rose accordingly.

Although Churchill has softened its endorsement of HISA in
recent months, NYRA said it still supports it.

“NYRA is strongly supportive of the Horseracing Integrity
and Safety Authority’s regulatory mission. … This lawsuit narrowly targets the unlawful, excessive and
disproportionate financial assessments that HISA’s authority is attempting to
impose on NYRA,” a statement from the racetrack operator said Thursday.

March 4 was set as the date for attorneys from both sides to
tell federal judge Rebecca Grady Jennings where this case stands. However,
motions for faster, temporary action are likely to come before that. CDI said in
the lawsuit that its refusal to pay up was met with a HISA threat to block
Churchill Downs from opening its spring season the week before Kentucky Derby
2025.