Maryland vexed by cherished yet struggling horse racing

State aid amounts to $45 million since 1997

millions more planned

May 19, 2011|By Julie Bykowicz, The Baltimore Sun

Maryland's elected officials have a familial sort of love for horse racing — boasting of the jobs and land preservation the industry brings to the state, even as they deal with disappointed expectations, unpaid loans and repeated entreaties for one last chance.

Once a year, politicians beam like proud parents on prom night as they watch Maryland horse racing all dressed up for the pageantry of the Preakness, the second jewel of the Triple Crown and the state's largest sporting event.

This time of year, it's hard to imagine lawmakers saying no to any racing request. On Friday, Gov. Martin O'Malley plans to visit Kentucky Derby winner Animal Kingdom at his training facility in Elkton, milling among horses and trainers as a way to promote Maryland horse racing during the week in which it shines brightest.

But even among racing's fiercest advocates, patience is wearing thin.

"It has been a disaster for the state of Maryland, a total, unmitigated disaster," said Senate President Thomas V. Mike Miller, a driving force behind state aid to the industry for the past several decades.

"I don't have optimism" that Maryland racing can be saved, the Prince George's County Democrat said. "But I still have hope."

This year, even as lawmakers approved $12 million in slots money to help support day-to-day track operations, they imposed greater oversight on the struggling industry, requiring reviews of financial documents, marketing strategies and a five-year business plan.

Legislative leaders say the state might, at some point, have to rethink its financial ties to racing.

"The question has become: 'What's the role of state government in continuing to promote and underwrite thoroughbred horse racing?'" said House Speaker Michael E. Busch. The Anne Arundel Democrat said the state's "rich tradition" of racing knocks against the reality that "it's a failing industry."

Lawmakers have wrestled for more than a decade with how much to help, Busch said, "and it will continue to be debated for the next 10 years."

The state has handed over $38.5 million since 1997 to increase purses for races, in the hopes that exciting, fully fielded races will lure new fans. More recently, lawmakers have funneled another $6.3 million from the state's fledgling slot-machine gambling program to track owners for facilities improvements and day-to-day operations.

As much as $1 billion more could flow toward racing over the next decade. When Maryland lawmakers designed the slots program in 2007, they agreed to give horse racing a 9.5 percent cut of all the revenue it generates — up to $140 million per year.

At the same time, the Maryland Jockey Club, which owns the state's two major thoroughbred horse racing tracks — Pimlico Race Course in Baltimore, the home of the Preakness, and Laurel Park in Anne Arundel County — is falling deeper into a financial pit, according to its recent financial disclosures. It has lost about $46 million over the past three years.

To stanch the bleeding, lawmakers agreed this year to allow track owners to use up to $12 million in slots money that was supposed to go toward track improvements to help keep a full racing calendar.

But — in a sign of growing distrust between state and racing officials — that money comes with strings attached.

The General Assembly created a Thoroughbred Racing Sustainability Task Force of track owners, horsemen and breeders, and is requiring the group to submit a five-year plan for legislative review by December.

Additionally, horse racing license holders are to provide legislators with financial information and develop a five-year business plan "that describes the challenges impacting the economics of operating the racing facility and strategies for addressing those challenges."

The state is also playing parent in another way: Since November, O'Malley and his top advisers have been mediating industry infighting, helping the state's track owners, horsemen and breeders work out their differences so they can focus on keeping racing alive.

"I think it's a shame that all the times we've been around the track, so to speak, they haven't been able to come up with a long-term strategy that everyone can live with," O'Malley said.

Jockey Club President Tom Chuckas was asked about the growing frustration of the elected officials.

"I think it's fair to say the governor and legislature want horse racing and the thoroughbred industry to be successful, and they recognize that's a difficult task and a huge challenge without slots," he said.

While lawmakers grumble that the state, which faced its own $1.5 billion budget hole this year, can't keep bailing out a dying industry, few cast votes against racing-related proposals.

The $12 million subsidy passed the Senate by a vote of 40-5 and the House of Delegates 106-28.

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