As the horses at Pimlico kicked up dirt and turf at Preakness on Saturday, the two sides jockeying to control the future of the storied event continued to sling mud.
Baltimore officials have accused Pimlico’s owner, The Stronach Group, of submitting inaccurate revenue figures to Maryland’s tax collector. And Stronach representatives have accused the city of peddling “faulty” calculations that could have been easily explained with a simple conversation.
The latest dustup in the months-long battle over whether the Preakness should stay in Baltimore or move to Laurel Park was recorded in recent letters obtained by The Baltimore Sun.
City Solicitor Andre M. Davis started the row by writing to Comptroller Peter Franchot last week that Stronach’s records “raise significant questions relating to attendance and revenue at the Preakness meet — which, therefore, may impact state tax collections.”
Davis is leading the lawsuit that the city filed against Stronach that aims to block the company from moving the Preakness to its Laurel Park racetrack and asks the court to grant ownership of Pimlico and the race to the city through condemnation.
Stronach attorneys quickly fired off their own letter to Davis a day later, criticizing him for not asking the company how its finances are reported to the state before penning the letter to Franchot. They also questioned why longtime lobbyist Bruce Bereano was the person to deliver the letter in an email to Franchot’s office, which confirmed the exchange.
“I am forwarding you a letter on behalf of the Solicitor of Baltimore City as I was asked to do,” Bereano wrote to Deputy Comptroller Lisa Wald on May 9. “Respectfully, my client who is working with Baltimore City and I sincerely hope that you act promptly and fully concerning this matter.”
Stronach attorneys Alan M. Rifkin and Arnold M. Weiner told Davis in their letter that they believe they know who Bereano’s client is.
Davis’ letter pointed to two statistics — attendance and revenue — that he believes raise doubts about whether The Stronach Group’s Maryland Jockey Club has provided accurate information to the state about its Pimlico operations.
Maryland residents “deserve stronger oversight from the Maryland Racing Commission and the rest of our state government,” Davis wrote to Franchot. “As currently reported, [The Stronach Group’s] numbers simply do not add up, and the state cannot be confident that its huge investment of taxpayer dollars is being protected.”
The company announced in 2017 that attendance during Pimlico’s two biggest days — the Preakness and the Black Eyed Susan — was more than 190,000 people. But the Maryland Racing Commission’s annual report for 2017 states that Pimlico attendance for its entire year was 121,402, according to the report.
And “admission revenue” reported in Stronach’s annual financial report to Maryland was $4,059,000. That would equate to an average ticket of admission for 190,000 people of $21. For 121,402 fans, the price would be $33. Total revenue, however, for 2017 at Pimlico was $27.5 million.
“Neither of these figures is credible given that they are far less than the least expensive ticket available on the day when most tickets are sold,” states Davis’ letter to Franchot.
But Stronach’s lawyers told Davis in their letter that he was using “incomplete, faulty and inaccurate information.” A call to a Stronach official could have answered their questions about what appear to be inconsistencies.
For example, the 121,402 attendance figure in the commission’s annual report is an estimate of how many people came to Pimlico during the whole year — 351 days of simulcast racing and 10 days of live racing. Estimates for the other two live racing days — the Preakness and Black Eyed Susan events — were excluded to provide better comparisons between Pimlico and the rest of the state’s tracks, a Stronach official said.
The 190,000 figure represented an estimate of total attendance in 2017, not just an estimate for paid attendance, the Maryland Jockey Club said Saturday in a statement. That includes horsemen, trainers, owners and many comp-ticket holders and workers. The estimate also includes a “per-capita wagering” estimate, concessions sales and other transactions that could indicate larger crowds.
The racing commission report does not explain that distinction. And the 121,402 figure appears in a chart in the commission’s annual report that also lists 12 racing days. Mike Hopkins, the commission executive director, was not able to confirm Saturday what the figure represents.
A Stronach official also said that calculating a simple average ticket price is not correct because the attendance figures are estimates, not accurate counts of every person who may attend as part of bigger parties, staffing agencies and other groups. “Admissions” revenue also does not count corporate sales — sponsorships, private tents, boxes and chalets.
And the total admissions revenue “does not include the portion of the total ticket price attributable to food and beverages included with the ticket,” according to the Jockey Club statement.
“As disturbing, in the midst of litigation initiated by the City, you failed to extend to us or our clients the courtesy of a copy of your communications with the Comptroller,” Stronach’s attorneys wrote.
The battle is certain to continue, as their letter makes clear.
“Actions such as these further impede the discussions that should be undertaken with the City, State and all other stakeholders to address the underlying issues,” the letter stated. “We again call upon the City to reconsider the wisdom of its unsupportable lawsuit and its unproductive attempts publicly to undermine our clients’ interest.”