January 05, 2011
The planned purchase of Rosecroft Raceway by attorney Peter G. Angelos means one thing for sure: The General Assembly session this spring is going to involve another major debate about expanding gambling. After all, the Orioles owner, racing fan and major donor to Democrats has tremendous clout in Annapolis, and his purchase agreement with the bankrupt raceway clearly indicates that a push for slots is part of his game plan. But beyond that, it's hard to say what the purchase will mean.
The Angelos name has never been far from the slots and racing debate in Maryland, despite Major League Baseball rules prohibiting him from owning a gambling operation. In 2009, he offered to help the state retain the Preakness Stakes, and his son, Louis, donated $100,000 to the slots legalization campaign in 2008. The younger Mr. Angelos contemplated bidding on a slots license but didn't. In 2005, the elder Mr. Angelos (through his wife, Georgia) agreed to buy Rosecroft, though the family backed out at the last minute when the odds of legalizing slots looked dim.
What are Mr. Angelos' prospects in Annapolis this time? Not good. He certainly can get a slots bill through the Senate (which has always been inclined to support expanded gambling at Rosecroft, as shown by the passage of a bill last year allowing table games there attests). Senate President Thomas V. Mike Miller, speaking at the opening of the new slots parlor at Ocean Downs on Tuesday, talked up reporters on the idea of slots or even a full casino at Rosecroft. But Mr. Angelos' chances in the House of Delegates are slim, indeed. The reason slots weren't allowed at Rosecroft in the first place is the strong opposition by Prince George's County delegates, and the election hasn't changed that.
Moreover, there's good reason to reject an expansion of gambling right now. Two of the state's five authorized slots parlors are now on line, but the state's largest, at Arundel Mills Mall, hasn't even broken ground yet, and the debate in Annapolis could overshadow the solicitation of new bids for a Baltimore casino this spring. If the Angelos family wanted a slots license, it could have bid in 2009 — or could bid for the Baltimore or Rocky Gap licenses now. But changing the rules in the middle of the game would be wrong.
Horsemen might be skeptical of Mr. Angelos' intentions for the track if he doesn't get slots, particularly given his performance in 2005. He walked away from a $500,000 deposit when Rosecroft's owners refused to allow him a 60-day extension to see if the General Assembly would pass slots, but the timing of the deal this time suggests he's not contemplating a repeat.
The documents filed with the court where Rosecroft is in bankruptcy proceedings suggest a closing by the end of this month, by which time any legislation allowing slots at the Prince George's County track would have likely not even had a committee hearing, much less a vote. And the situation has changed since 2005. Because of the constitutional amendment that authorized Maryland's slots program, any expansion of gambling would now require not just the consent of the General Assembly but also approval by the voters, which couldn't come until at least November 2012.
(In a curious side note, the purchase agreement includes a meaningless requirement for Mr. Angelos to pay an extra $5 million for Rosecroft if "slots are authorized through a constitutional provisions [sic] and gaming is operational at Rosecroft by December 1, 2012." Getting a slots license and starting up a slots parlor in less than a month after the 2012 election would be effectively impossible.)
It looks like Mr. Angelos actually intends to make a go of horse racing at Rosecroft, which hasn't had live racing since 2008. The purchase agreement calls for him to make every effort to get a license and resume races there this year.
But what is his long-term plan? Part of Rosecroft's demise is connected to an agreement with the thoroughbred industry for the track to pay $5.9 million a year to access its simulcast signal, necessary for the off-track betting that made up much of its revenue. Rosecroft's former owners tried to negotiate that down to $2 million a year, and the thoroughbred owners refused. Perhaps Mr. Angelos, a famously skilled negotiator, can strike a deal, particularly since the thoroughbred owners now find themselves paying $1.7 million this year to prop up the Maryland Jockey Club's racing operations at Pimlico and Laurel Park.
