"It's funny how things work out," he said. "Your perspective changes as you get older."
Stewart grew up around horses and he went into the breeding business in 1974, with his father Bill. After his father died in 1978, Stewart decided on what he did not want and headed west where he worked at various horse tracks in El Paso, Ruidoso, Colorado, California and Texas. He returned to Bell County in 1985 to manage the breeding operations at Diamond S Farm.
In 1998, Stewart and his wife Bonnie started the Double S Horse Farm outside of Holland. They brought with them a promising stallion named Royal Shake 'Em, which Stewart first began to develop at Diamond S. Of the seven stallions at Double S, Royal Shake 'Em is the acknowledged superstar.
After Royal Shake 'Em retired from racing, where he won five of 14 starts as a 2-year-old and finished second seven times, he has sired more than 100 racetrack winners.
"He's a consistent producer for us," Stewart said. "He's produced at least 100 babies, five years in a row and about 1,500 foals overall. He's been a horse of the year. He's just a great producer."
Having a top stallion like Royal Shake 'Em has not been enough to keep horse breeders like Stewart from facing a significant loss of revenue over the last few years. He said the Texas horse racing industry is having a hard time competing with neighboring states like Oklahoma, New Mexico and Louisiana.
The reason, he said, is that video gaming supplements racing income in those, and most other, states. Texas has so far not given legislative approval for the video lottery terminals (VLTs) at race tracks.
"A lot of people in the horse business are in trouble now," he said. "People who have been in it for a long time are getting out or thinking about going somewhere else."
Legislation was introduced in the 2005 regular session of the legislature that would have authorized the Texas Lottery Commission to operate video lottery games at licensed racetracks across the state, but the legislation failed to pass. Ray Perryman, a Waco economist, has projected that video gaming would produce $1.5 billion per year in state revenues. Opponents argue that VLTs are nothing more than video slot machines and would lead to an increase in gambling and crime.
Stewart, a board member of the Texas Quarter Horse Association, said that organization and others within the state hope to see a bill legalizing the video lottery terminals passed in the next session of the legislature to help not only his industry, but the state's agriculture producers as a whole.
"The way our business has fallen off hurts not just us, but people who grow the grain that we have to buy," he said. "At my peak here, I was spending about $250,000 on grain and hay. That's down to about $100,000. It's hurt restaurants in town because there aren't as many people from all over coming here to the farm. Those people would usually eat at one of the local restaurants, buy some gas. Now those places are going out of business."
Double S isn't going out of business, but business is down. Five years ago, Double S was producing about 500 foals a year; that's down to 170 a year now. Stewart has paid off most of the stables and other parts of the business, but still has to cut back as much as he can to make ends meet. At the same time, he said he tries not to cut back so much that Double S can't produce the kind of race horses that Stewart's customers expect.
"You can kill it by being too tight, but you have to watch expenses, too" he said. "The racing part of the business is bringing about 60 cents on the dollar of what it was five years ago."
Stewart is a board member of the Texas Quarter Horse Association, which will conduct its annual yearling sale beginning July 29 in Houston. This year's show will feature for the first time a halter class.
"We're trying to develop a whole new class of competition," Stewart said. "There will be a $500 cash prize in each category."
Though points won't be awarded in the new class, the American Quarter Horse Association will record the results of the special halter class.
For more information about Double S Farm, visit www.DoubleSFarm.com.
