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News Opinion Editorial

Md. horse racing gets its act together

Maryland's horse racing industry has faced a multitude of threats in recent decades — increased competition from other forms of gambling; massive subsidies to horsemen, breeders and tracks in other states; an aging fan base and a general decline in interest in the sport of kings. But the most vexing challenges are those that Maryland's industry has imposed on itself in the form of persistent infighting that has prevented any concerted effort to reverse a decades-long slide.

Given the history and the overall state of horse racing, it may be a mistake to grow overly optimistic about the prospects for revival. But the news that the Maryland Jockey Club, the Maryland Thoroughbred Horsemen's Association and the Maryland Horse Breeders Association appear on the cusp of a 10-year deal on revenue sharing and race days offers the promise of stability and time to develop a sustainable model for the future.

The proposal calls for 146 days of racing in 2013, the same level the state's thoroughbred tracks have seen in recent years, and a minimum of 100 days thereafter, with the possibility that the horsemen could pay for more days. That's a remarkable turnaround, given where the tracks and horsemen were a year ago. Then, Frank Stronach, who owns the Jockey Club, was threatening to close Laurel Park altogether and hold just 40 days of racing at Pimlico, which might have kept the Preakness Stakes around for a time but would have effectively destroyed Maryland's storied horse racing industry. But, as has happened periodically during his decade-long interest in Maryland racing, Mr. Stronach had an abrupt change of heart, agreed to 146 days in 2012 and got serious about negotiating with the horsemen.

The deal isn't finalized, and some details remain to be worked out. One of the crucial elements is a commitment by the horsemen to help pay for track operations on a greater scale than they have in recent years, but the agreement does not contemplate any additional subsidies from the state. As it stands, the state has dedicated 7.5 percent of slot machine revenue to increasing racing purses and another 2.5 percent to provide a matching fund for capital improvements at the tracks. But two years ago, the governor and legislature agreed to divert those capital funds to help cover the tracks' operating losses. That agreement runs out after 2013, and the proposed deal between the tracks and horsemen does not anticipate that it will be continued.

Meanwhile, arbitration is set to begin on Dec. 10 to determine how much Rosecroft Raceway should pay the horsemen as compensation for the simulcast signal from Maryland's thoroughbred tracks. In 2006, Rosecroft agreed to a 15-year deal that would have paid the horsemen $5.9 million a year for the signal, but the harness track's always precarious finances took a major turn for the worse shortly thereafter. Rosecroft suspended live racing in 2008 and stopped paying for the simulcast signal in 2009, leading to the facility's closure in 2010. It subsequently reopened after being purchased by Penn National Gaming, and a resolution to the simulcast dispute is crucial both to its future and to thoroughbred racing. The thoroughbred horsemen may not get the full $5.9 million, but anything would be better than what they've been getting for the last three years — nothing. Given that they will be on the hook for more operating expenses at Laurel and Pimlico, they will likely need the cash.

Probably the most painful element of the proposed agreement is the permanent closure of the thoroughbred training facility in Bowie. It's an idea that has been long in coming and will allow the Jockey Club to save money and consolidate operations. It also moves the center of gravity of Maryland horse racing to the north because some horses that had been stabled at Bowie will move instead to Pimlico. In this case, Bowie's loss could be a big gain for Baltimore because that will force the Jockey Club to invest more in Pimlico's facilities and make that track a year-round operation for the first time in recent memory. And given the central role the Preakness plays in the viability of Maryland racing, improving Pimlico makes sense.

This agreement, if it is approved by all relevant parties, will not save Maryland horse racing, and neither will the millions flowing from slot machines into purse subsidies. The Jockey Club and horsemen still need to figure out a way to attract more paying customers to the track and to get them to bet more on the races. But the slots subsidies are already producing larger and better fields, and this deal offers the promise of predictability and stability for the next decade. If the industry can't use that time to find a way to make itself relevant, it probably never will.

Copyright © 2015, The Baltimore Sun
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