Long-suffering Maryland tracks still waiting for a casino bailout

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On Saturday afternoon, Maryland horse racing once again will take its place in the sporting world’s spotlight with the 136th running of the Preakness Stakes at Baltimore’s Pimlico Race Course. The other 364 days of the year, however, Pimlico and the Maryland racing industry aren’t proving ready for their close-up.

Plagued by poor planning and without the expected revenue from slot-machine gambling, Maryland’s storied racing industry has been left with fewer horses, smaller purses, aging facilities and no visible plan for long-term stability.

“The state of Maryland racing is not something that happened yesterday morning. It’s been an attrition over the last 10, 12 years. There’s not the level playing field,” said Tom Chuckas, president of the Maryland Jockey Club. “Prior to the advent of the additional forms of gambling, Maryland was head and shoulders above our mid-Atlantic competitors.”

Not anymore.

The introduction of slots and casinos in Pennsylvania, Delaware and West Virginia in particular has handcuffed Maryland racing, which for decades served as the hub for thoroughbreds in the region, thanks in large part to the Preakness.

“Maryland was a very good racing circuit for a very long time, so it’s very sad,” said jockey Rosie Napravnik, who rode Pants On Fire in this year’s Kentucky Derby. “A lot of us have had to kind of move out of Maryland because there’s no money there. It’s very sad what’s kind of happened with the racing there and the downfall.”

What went wrong?

It was a battle fought in the General Assembly for years: Should Maryland allow casinos to aid budget shortfalls, help schools and bolster the horse racing industry? When voters in 2008 approved 15,000 slot machines at five locations, officials in the Maryland horse racing industry were delighted that the state seemed to have solved their problems, just as Pennsylvania had done in 2004. But there was a hitch.

“The way the slot law was written, the thoroughbred track was not named as a slot licensee,” said Alan Foreman, general counsel for the Maryland Thoroughbred Horsemen’s Association. “It allowed competing bids to come in.”

Slots were approved in five locations: Anne Arundel County (where Laurel Park resides), Baltimore city, Cecil County in the northeast, Allegany County in Western Maryland, and Worcester County on the Eastern Shore. After years of drumming up interest in slots and millions of dollars invested in making them available in Maryland, Magna Entertainment (now known as MI Developments after a bankruptcy filing) - owner of Pimlico and Laurel Park and majority stakeholder in the Jockey Club - failed to include a $28.5 million license fee with its bid for slots at Laurel in early 2009.

Because of that error, a Baltimore-based company, Cordish Cos., secured the slots license at Arundel Mills for an operation that won’t begin until next year. Although the horse racing industry is receiving some money from slots venues that are already in operation — 7 percent of the revenue for breeding and purses and 2.5 percent for capital improvements — the windfall has not been nearly as beneficial as having a casino at a racetrack such as Charles Town Races in West Virginia, Delaware Park and Parx in a Philadelphia suburb.

“Maryland, because it has taken so long to get slots up and running here, has really lost a lot of ground,” said Cricket Goodall, director of the Maryland Horse Breeders Association. “We have to catch up.”

A ‘respite’

Catching up to regional rivals undoubtedly will take time. Without immediate slots revenue, Maryland can’t do everything necessary to revive its horse racing industry.

There are some reasons for hope. In December, Gov. Martin O’Malley announced a deal that would ensure a full slate of live racing this year. That agreement, he said in a statement, “not only keeps Maryland’s treasured Preakness Stakes where it belongs, but it helps protect the thousands of jobs that depend on our rich history of horse racing.” With an industry that supports 28,000 full-time workers and contributes $1.5 billion to the state’s economy, that’s no small victory.

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