NSW Racing Minister Paul Toole says the coalition will contribute the funds to the inaugural Million Dollar Chase at Wentworth Park in Sydney making it the richest greyhound race in the world.

The government commitment comes two years after former premier Mike Baird attempted to ban the industry - out of concern for animal welfare - before backflipping on the decision.

The announcement comes less than a month after the latest mass grave was discovered in western Sydney.

The RSPCA found nine dogs rotting in a single grave at a property owned by a registered and licensed greyhound trainer in Marsden Park in early July.

Another 12 emaciated greyhounds were also seized at the property.

When asked about the most recent mass grave discovery, Mr Toole pointed to tougher restrictions placed on the industry.

"Those things will go through a proper investigation process and at the end of the day, if someone is found to be doing the wrong thing, I can tell you they won't be there," Mr Toole told reporters.

"I actually think the guys have done a really good job in actually setting the pathway to ensure that this is going to be an industry that is going to be around for a long time."

Greyhound Racing chief executive Tony Mestrov said the $500,000 in government funding proved the industry had a future.

"This is the biggest announcement ... the industry has had at least in the past 20 years."

But opponents of the sport say the taxpayer funding boost is "sickening".

Greens MP Mehreen Faruqi said the government was allowing the greyhound industry to behave "with impunity".

"People would be horrified to know their tax dollars are propping this gambling industry, rife with animal cruelty," Dr Faruqi said in a statement.

Animals Australia campaign director Lisa Chalk said the government's contribution was an "appalling misuse" of taxpayer money.

"To get their hands on a prize purse greyhound trainers have been prepared to kill dogs, drug dogs and blood dogs with live animals," Ms Chalk told AAP.

Following the government's October 2016 backdown in the face of an industry-led backlash, greyhound racing underwent substantial reform in the state, with former NSW premier Morris Iemma appointed chairman of GRNSW.

The industry was split in two with an integrity commission to oversee stricter controls on euthanasia and enforcing bans for live baiting.

The Million Dollar Chase will begin with 11 regional qualifying events before the grand final at Wentworth Park in October.

The overall purse totals $1.7 million - with $1 million for the winner.

The winning trainer will have to pay the $1 million prize back if their animal is not properly rehomed after retirement.

But Hunter Valley greyhound trainer Natina Howard says the cash would be better spent propping up the industry at its roots - rather than rewarding big city owners.

"All the little trainers are slightly cheesed off about a major race being given money where it should be split up between country tracks and everyday racing," Ms Howard told AAP on Tuesday.

Australian Associated Press