Casinos in Atlantic City have agreed to continue subsiding the horse racing in New Jersey and will offer even more funding than they have previously.
The state's three horse racing tracks will receive $90 million from casinos over the next three years, governor Jon Corzine announced, although legislation has not yet been formalised.
"I'm pleased to announce that after extensive discussions we have crafted an agreement that will extend a three-year lifeline to the horse racing industry," Mr Corzine said.
Meadowlands Racetrack, Monmouth Park and Freehold Raceway will receive $30 million a year, compared to the $21.5 million per year they received from casinos during the last four-year agreement.
But it is in the casinos' interests to donate the money; in return, the racing tracks will not be allowed to install video lottery terminals.
"Both the equine industry and the casino industry play important roles in New Jersey, from preserving open space to attracting visitors, and it was essential to strike a balance that will allow both industries to thrive," Mr Corzine said.
The casinos are understood to be set to receive tax benefits as part of the exchange, although these have not yet been outlined.
Casinos in Atlantic City have agreed to continue subsiding the horse racing in New Jersey and will offer even more funding than they have previously.