Rosecroft, Delmarva file for possible shutdown 800-plus workers would be laid off

April 01, 1995|By Jon Morgan | Jon Morgan,Sun Staff Writer

In another sign of the dire condition of the state's harness racing industry, the owners of money-losing Rosecroft and Delmarva Downs have notified state officials they intend to close the racetracks and lay off more than 800 workers.

A track spokesman, however, said the filing is a legal precaution that would allow the shutdown if sales talks were to falter. An association of horse owners and trainers is negotiating to buy the tracks.

The 60-day notification, required under the state's plant closing law when a major employer plans to shut down, was filed Thursday, said Marco Merrick of the state's Department of Economic and Employment Development.

The notice said the tracks would close between May 30 and the end of June, eliminating 650 jobs at Rosecroft in Oxon Hill and 169 at Delmarva near Ocean City, Merrick said. Most of the jobs are part time.

"It means that it could happen. It's a legal precaution," said track spokesman Jerry Connors.

If the tracks closed without notice, they could be penalized for the pay and benefits that would have accrued during the 60 days.

"We continue to remain optimistic that something will work out. If you can't be optimistic in the racing business you shouldn't be in it," Connors said.

The tracks have lost about $12 million over the past four years, including $6.2 million last year. Last year's losses included a one-time, $4.8 million accounting charge and nearly $800,000 in tax credits.

The Cloverleaf Standardbred Owners Association signed a letter intent to take over the tracks and much of their debt in a deal worth $11 million. The letter was set to expire May 9, but it has been extended to June 28.

"We're working to close the deal," said Alan Foreman, an attorney for Cloverleaf. He declined to lay odds on the deal being consummated, but said the group is going over the purchase agreement submitted by the tracks.

In a recent filing with state regulators, the tracks' parent corporation, Colt Enterprises, reported $16 million more in current liabilities than assets and said it would file for bankruptcy if a sale could not be arranged.

The tracks were taken into bankruptcy in 1991, and Los Angeles-based businessman Fred Weisman bought them for $18.2 million. Weisman died in September and his estate is trying to sell the tracks.

Foreman said Cloverleaf had been warned the 60-day notice would be filed.

"They felt they were obligated by law to give that notice in the event they had to close," he said. "It doesn't mean they will close."

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