Loss of subsidy blow to racing

Upset lawmakers let House bill die

tracks are out $10M

Horse Racing

April 11, 2001|By Jeff Barker | Jeff Barker,SUN STAFF

The General Assembly's decision to end a $10 million purse subsidy to Maryland racetracks comes when they need the help the most - just as rising prize money and slot machines are giving tracks in neighboring states a competitive edge, industry officials said yesterday.

"This is the worst possible time this could happen. Those other purses are going through the roof," said Joseph A. De Francis, president and CEO of the Maryland Jockey Club, which operates Pimlico and Laurel Park.

A bill to obtain the purse funding from excess lottery revenues cleared the Senate in March, but remained stuck in the House Ways and Means Committee as the 90-day legislative session ended Monday night. It would have been the fifth year of the subsidy.

"It's going to be extremely bad news, not only for the tracks, but for the people in the community around Rosecroft in Prince George's County and the people who live in Baltimore around Pimlico," said Del. Clarence Davis, a Baltimore Democrat. "If it adversely affects Pimlico in any serious way, it will endanger the Preakness."

The decision to end the subsidy reflects growing frustration among House leaders and others with management at the tracks. Opponents of the state aid say the industry has moved too slowly to take necessary steps to ensure its survival - everything from telephone wagering to track improvements to securing off-track betting parlors in large-population areas.

Gov. Parris N. Glendening said he didn't object to the decision, hadn't followed the bill closely and was content to follow the House's lead.

"This has everything to do with the management of the racing industry," House Speaker Casper R. Taylor Jr. said yesterday. He said the bill lacked support among House leaders, the Glendening administration and the Maryland Racing Commission.

The purse supplement was divided between the harness and thoroughbred tracks. About $6 million of the $10 million went to purses at Pimlico and Laurel Park. Subtract that $6 million from the $43 million paid last year to the owners of winning thoroughbreds and the thoroughbred industry faces a 14 percent reduction in purse money.

That will not affect the current meet at Pimlico, De Francis said. The 2000 purse subsidy lasts until June 30. De Francis said he would meet with the Maryland Thoroughbred Horsemen's Association, an organization of trainers and owners, to decide what to do beginning July 1.

A dip in purses would hurt Maryland in its competition for horses with prosperous tracks in neighboring states. Charles Town in West Virginia and Delaware Park near Wilmington subsidize their growing purses with proceeds from slot machines.

The racing commission's frustration with the industry was made clear in a letter from its chairman, John B. Franzone, to House leaders last month.

Franzone said in the letter that although the commission adopted telephone wagering regulations last year, track operators had been slow to submit plans. "If this had been such an important issue for racetracks to grow their business, I find it very odd that telephone account wagering's implementation is still in limbo in Maryland," he said.

Franzone also noted that there had been only one new OTB application during his more than four years on the commission.

"The Maryland horse racing business is in a steady decline, yet the industry continues to pursue the same game plan - bicker among themselves all year long, then come to Annapolis, get the purse supplement and put off any real change until next year," his letter said.

De Francis said he and others have been unable to proceed with new OTB sites - other than one in Cecil County - because the thoroughbred horsemen's association has refused to consent until it settles a revenue-sharing dispute with the harness industry. He said telephone wagering is victimized by a national firm's delays in establishing a horse-racing television channel and a national account wagering system.

De Francis said he was disappointed about losing the purse subsidy, but grateful for having it for four years. "Everyone in the industry has recognized that this purse subsidy was not an eternal subsidy," he said.

Some legislators believe Maryland tracks need to join their West Virginia and Delaware rivals in adding slot machines to their operations. The infusion of slot money has increased purses in those two states, enabling tracks to attract stronger fields and attracting Maryland bettors.

But Glendening is opposed to slots, dimming the prospect of the assembly's approval before his term is up at the end of next year.

Sun staff writers Tom Keyser and Howard Libit contributed to this article.

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