After five full months of operation, through the end of the Pimlico fall meet that concluded yesterday, the state's network of electronic betting systems is paying dividends for Pimlico and Laurel racetracks.
Although the tracks continue to operate at a loss because of $4.5 million in annual interest payments, the introduction of simulcasting and off-track betting parlors in Maryland has helped slow the flow of red ink. Based on gross betting receipts, business has turned around 38 percent.
The tracks had had a steady decrease in handle since an all-time high in 1990. But by the first four months of 1993, business was eroding, bringing even sharper drops. Gross handle fell 16.52 percent from the same period in 1992. In January, February, March and April of this year, there was a combined loss of nearly $23 million in bets, and the amount of money generated for the horsemen's purse account fell by 17 percent.
"Clearly, if we had continued operating this way, we would have been bankrupt -- kaput -- by the end of the year," track operator Joe De Francis said.
One of the reasons attributed to the loss of business was that nearby competitors such as Delaware Park, Garden State Park in New Jersey and the Charles Town (W.Va.) Races were attracting customers from Maryland by simulcasting full cards of races from prestigious tracks in New York and California. The decrease also coincided with the introduction of keno in the state's lottery system.
This, coupled with the Maryland tracks finding it harder and harder to card quality programs with full-sized fields of competitive races, led De Francis to push for out-of-state simulcasts.
After a year of negotiations with horsemen, legislators, union officials and the state's two harness tracks -- Rosecroft and Delmarva -- he introduced a package of expanded betting systems starting at the end of April.
Included in the package:
* A cross-breed simulcasting program -- Pimlico/Laurel thoroughbred races began being televised at Rosecroft Raceway in the afternoons starting April 22. In turn, the Rosecroft/Delmarva standardbred races were simulcast into Laurel and Pimlico at night. Delmarva Downs eventually came on line as a thoroughbred simulcast outlet in June.
* A series of full-card simulcasts from California (Hollywood Park), Kentucky (Churchill Downs), Illinois (Arlington Park) and New York (Belmont Park) were added to the daily menu of live Maryland races.
* Two OTB parlors, one near Frederick and the other near Elkton, were in operation by June 1. A third OTB parlor in Cambridge opened Aug. 20.
In addition, on July 14, Pimlico and Laurel began opening for simulcast business on Wednesdays -- when there is no live racing. The money wagered on Wednesdays averaged $546,787 for six Wednesdays through Aug. 20, but has dropped to an average of $439,768 during the past three Wednesdays, when there has been no California signal.
But there is the fear that the track is relying too much on simulcasting to correct its financial woes. The concern is that once the fans start betting the out-of-state races, they no longer will support the live Maryland card.
In June, when the track mixed its daily live card with simulcasts from Belmont Park, Hollywood Park, Churchill Downs and Freehold Raceway, the breakdown between wagering on the live races vs. simulcasts was 60.75 (live) to 39.25 (simulcasts). In July, the split was 56.65 for live vs. 43.35 for simulcast. Then, when Saratoga and Del Mar were added to the mix in August, the live percentage dropped further to 54 percent compared with 46 percent for the simulcasts.
However, in September, the split tilted back in the 60-40 range in favor of live races.
If simulcast handle exceeds live handle, it could have serious repercussions for the tracks and horsemen. Profits are lower on the simulcasts, because the track has to pay for the signal.
"We make a third more out of the live races than we do on the simulcasts, so that's our incentive to pump the live handle as much as we can," De Francis said.
The quality of Maryland's live card has increased sharply in the past couple of months, De Francis said.
"The mix of races has shifted from cheap claimers to the increased use of a number of higher-class races, which weren't filling before," De Francis said. "We're distributing more purse money because the better races are being carded.
"We also are presenting bigger fields. For example, during the last 18 days in Maryland, we ran 177 live races filled by 1,488 horses. That breaks down to 82.67 horses per card, or 8.4 horses per race. By comparison, Belmont Park . . . has run 180 races during its last 20 racing days filled by 1,376 horses. That breaks down to 68.8 horses per card or 7.64 horses per race."
He added that the fear among some horsemen that live racing will be reduced is also unfounded.
"We have an agreement with our horsemen that we must card 47 live races a week for 51 weeks out of the year. That can't change unless the horsemen agree to it," De Francis said. "They have all the power.