The rule that creates it
Each state's pari-mutuel rules set a minimum payout on a winning ticket. Payouts normally come from the losing share of the pool, and when nearly everyone backed the same horse, the losing share is too small to fund even that minimum.
At that point the pool goes 'minus': the track must top it up so every winning ticket still receives its state's mandated minimum. The figure itself lives in each state's wagering rules; every number in the example below is illustrative arithmetic, not a statement of any particular state's rule.
A worked example
Suppose a state's rules set the minimum at $2.10 on a $2 bet, the show pool holds $100,000, and $95,000 of it sits on one overwhelming favorite. With an illustrative 15 percent takeout, $85,000 remains to pay out. The favorite shows, so the $95,000 in winning show bets must be repaid before any profit is added, and $85,000 doesn't even cover the stakes.
Meeting that $2.10 minimum means returning $99,750 on those tickets: the $95,000 in stakes plus $4,750 in mandated profit. The pool after takeout is $14,750 short, and the track absorbs that difference. Multiply the pattern across the other horses that also showed and the shortfall grows.
This is why tracks quietly dread odds-on champions in small fields: a star like a Triple Crown contender can put the show pool underwater no matter what the track does.
Why it's usually the show pool
Show bets pay on three finishing positions, so a show bet on a dominant favorite attracts disproportionate money. Bridge-jumpers pile in because the minimum-payout rule makes it a high-probability, low-return wager, but the risk is concentrated: the favorite running fourth wipes out the entire stake, and one such loss can erase a long string of small wins.
See also: How pari-mutuel pools work
What it means for you
If you hold a winning ticket in a minus pool, nothing changes: you're paid at least the mandated minimum. The concept matters mostly as a lens on pool mechanics: payouts come from other bettors' money, and when that money all agrees, the arithmetic breaks and the track makes up the gap.
Common questions
Who pays for a minus pool?
The track (and its wagering partners, per their agreements) covers the shortfall between what the pool can fund and the state-mandated minimum payout.
What is a bridge-jumper?
Racing slang for a bettor who wagers a very large amount to show on a heavy favorite, chasing the small mandated minimum profit. The name is dark humor about what happens when the favorite finishes off the board: the strategy's rare losses are catastrophic ones.
Can win or place pools go minus too?
Yes, it's the same arithmetic, but it's rarer: win and place bets pay on fewer positions, so money spreads more and the favorite's share of those pools is usually smaller.
Further reading