A synthetic training track and 300 new stables will be built at Cessnock Racecourse as part of an $11.5 million upgrade.
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The NSW Government has provided the funding as part of its $67 million investment in regional racing.
Cessnock Racecourse was sold in August 2020 to Racing NSW, which plans to convert the historic track into a world-class pre-training centre that is expected to create hundreds of jobs.
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Racing NSW chairman Russell Balding AO said the racing industry is very grateful for the government's investment in regional racing.
"This (funding) announcement will not only ensure the ongoing sustainability of racing in the Cessnock region, but importantly it will allow local trainers to compete with provincial and city-based trainers on an equal footing in respect of access to modern training infrastructure and facilities and allow country horses to be more competitive," Mr Balding said.
Minister Responsible for Racing, Kevin Anderson said the funding injection will give Cessnock access to first-class training facilities with new stables and a work-track for training horses.
"Earlier this year the NSW Government announced the single biggest investment in regional racing and I am pleased to announce that Cessnock racecourse will receive significant upgrades as part of that funding," Mr Anderson said.
"The racing industry is the backbone of many regional communities, contributing over $3.5 billion annually to the NSW economy and acting as a significant employer for over 6,700 people here in the Hunter."
Parliamentary Secretary for the Hunter Taylor Martin said Cessnock will have some of the best training facilities in Australia.
"There will be significant flow-on effects of these upgrades for Cessnock as people flock to town for the races, staying in local hotels, eating at local cafes, and shopping locally," Mr Martin said.
"This is the single largest investment by the NSW Government in racing infrastructure and it is great to have secured such a significant investment for Cessnock."
Racing ceased at the Cessnock track last year after the sale to Racing NSW. Chief executive officer Peter V'landys said at the time there would be no more racing at Cessnock "at this stage", but community race meetings may return in the future.