Sending shock waves through the state's thoroughbred industry, Bally's Maryland Inc., the new owner of Ocean Downs, has applied for permission to open an off-track betting facility in Hagerstown.
Revealed yesterday at a meeting of the Maryland Racing Commission, the move launches what thoroughbred-racing insiders fear could become a battle between Bally's, owner of the harness track near Ocean City, and the Maryland Jockey Club, owner of Pimlico and Laurel Park, for control of horse racing in the state.
At the least, a Bally's OTB would strengthen the position of the casino and hotel giant if slot machines or casinos are approved in Maryland.
"Bally's is trying to use their 40 days of live harness racing -- minor-league harness racing -- as a beachhead to establish OTB facilities in Maryland and make a ton of money by stealing -- and that's the word for it -- stealing thoroughbred simulcast signals," said Joe De Francis, president and chief executive officer of the Maryland Jockey Club.
If Bally's is allowed to proceed, De Francis said, "they'll make a fortune and put us out of business. That's exactly what they're trying to do."
Dennis Dowd, president of Bally's Maryland, said his company has no such intentions. Bally's Maryland is owned by Hilton Hotels Corp., which also owns hotels, health clubs, entertainment centers and casinos.
Two months ago, Bally's Maryland acquired the financially troubled Ocean Downs harness track from the owners of Rosecroft Raceway, the harness track in Prince George's County. Now, Dowd said, his company merely wants to compete for its share of the state's racing and gambling business.
"Competition, we think, is what drives this country," he said. "McDonald's wouldn't be as successful as it is if Burger King hadn't opened.
"We're trying to raise the level of the OTB system in Maryland. If that makes some people nervous, maybe they should reassess where they put their money and efforts. If they decide to step up to the plate and work harder and do better, God bless them."
Speculation by thoroughbred supporters is that Bally's wants to damage Maryland's thoroughbred industry, increasing the likelihood of aid in the form of slots -- or cripple the industry so that Bally's could assume control.
"Yes, we would like to see slots in Maryland," Dowd said.
Bally's Maryland holds an option to buy 65 percent of Rosecroft Raceway if additional gaming, such as slot machines, becomes legal in Maryland.
"But just because we want to do better doesn't mean we want to hurt someone else," Dowd said. "We want to see everybody do better."
Bally's Maryland is also seeking permission from the Maryland Racing Commission to bring into its buildings any simulcast signal that it desires -- regardless of previous agreements between harness and thoroughbred interests and in spite of opposition from the Maryland Jockey Club.
De Francis and Martin Jacobs, general counsel of the Maryland Jockey Club, said they fear Bally's Maryland will negotiate deals that would deny the thoroughbred tracks, trainers, horse owners and breeders their fair share of the rich simulcast pie.
De Francis termed that "stealing" from the thoroughbred industry.
Shortly after signing the papers to buy Ocean Downs, Bally's Maryland withdrew from an agreement between the thoroughbred and harness tracks -- and horsemen and breeders on both sides -- that divides up the money from simulcasting. Ocean Downs ceased simulcasting thoroughbred races during the day, including those from Pimlico and Laurel.
Then Bally's Maryland asked the Maryland Racing Commission for the freedom to negotiate its own simulcast deals. The commission is awaiting an opinion from the attorney general before acting on that request.
Regardless of the attorney general's opinion and subsequent commission action, the matter will likely end up in court or the state legislature -- or both.
As for Bally's Maryland's request for the OTB, the racing commission may schedule its August meeting in Hagerstown so it can hear the case. The facility needs only racing commission approval; it doesn't have to go before the General Assembly.
The 18,500-square-foot OTB would be at the North Village Shopping Center on Route 11 in Hagerstown. It would serve 500 patrons and offer 500 parking spots.
Dennis McCoy, a lawyer for Bally's Maryland, said the company would pursue the OTB regardless of the outcome of the simulcasting issue. He said the company would spend $1.5 million to make it "a classy, white-tablecloth" facility.
Its out-of-state competitors would be a modern simulcast facility in Chambersburg, Pa., and the horse track in Charles Town, W.Va., due to activate video-lottery machines about Aug. 1.
An OTB in Hagerstown would also presumably attract business from Maryland's most successful OTB site, the Cracked Claw in Urbana in Frederick County.
Dowd said Maryland gamblers shouldn't have to drive to Pennsylvania, Virginia or West Virginia for a first-class OTB.
He said the OTBs operating in Maryland suffer because they were fitted into existing restaurants -- as opposed to new designs for vacant buildings. The proposed site in Hagerstown is vacant, Dowd said.
Pub Date: 7/10/97