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Uncertain future of Maryland racing hangs over Preakness celebration

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Uncertain future of Maryland racing hangs over Preakness celebration

May 19, 2023 | 7:00 am ET
By William F. Zorzi
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Uncertain future of Maryland racing hangs over Preakness celebration
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A horse and jockey train in the early morning hours at Pimlico Race Course earlier this week. The 148th running of the Preakness Stakes will be held on Saturday. Photo by William F. Zorzi.

As the sun rose over the mile-long oval at Old Hilltop and the first rays of daylight shot across the infield, bouncing off the glass-fronted grandstand at Pimlico Race Course, two old track hands crossed paths on the asphalt apron below.

“Merry Preakness,” one said to the other, without even a hint of irony, as the two smiled and kept walking back to their respective jobs in the tough, physical work of the horse trade. Both had been at the Northwest Baltimore track since well before daybreak.

Slow-building excitement was palpable this week at Pimlico as fans and workers alike prepared for Maryland’s grandest thoroughbred celebration of the year: the Preakness Stakes, the second jewel in North America’s Triple Crown of racing.

But on the eve of the 148th running of the Preakness on Saturday, all is not well with the Sport of Kings, whose fortunes have been dimmed by sharply downward trends of late.

Once the most popular spectator sport in the United States, racing is now battling to stay pertinent and afloat amid heavy competition for betting dollars, dramatically waning attendance, the repeated tragedy of horse deaths at tracks nationwide — including at Laurel Park, Pimlico’s sister track — and a struggle for control of the industry in Maryland.

While the sport is not on the verge of going the way of dog tracks and cockfighting, it is facing serious challenges that will likely change the way horse racing is conducted. It is a complicated, multilayered drama whose ultimate resolution will determine the future of racing in the state.

A showdown is brewing in Maryland as state government expands its role in overseeing racing and attempting to jumpstart the stalled improvements at Pimlico and/or Laurel that were approved by the General Assembly more than three years ago.

In its 2020 session, the legislature authorized the sale of $375 million in bonds for capital improvements at the two mile-long tracks, but the bond sale, contingent on the approval of certain still-unsigned agreements, has yet to take place. Since then, cost estimates have nearly doubled, as any sort of progress has ground to a halt.

“The appetite of the state to continue to do this dance is very limited,” said one official. “I think people … are fed up.”

In addition, there is a very real question in the racing industry and among state officials as to whether thoroughbred racing at two tracks can be supported in Maryland, and there has been a push in recent months to consolidate year-round racing at one track, rather than two. Although Laurel Park was once touted as a potential “supertrack” in the state, the focus has now shifted to Pimlico, though that would require finding a location for a training facility and more than 1,000 additional horse stalls.

Against that backdrop is a looming deadline for a negotiated agreement between the track owner-operators — the Canada-based Stronach Group’s Maryland racing subsidiary — the Maryland Thoroughbred Horsemen’s Association, which represents owners and trainers, and the Maryland Horse Breeders’ Association. Their current agreement, already extended from December 31, 2022, is set to expire at midnight June 30.

The Stronach Group, which does business as 1/ST and operates here under the Maryland Jockey Club name, has yet to apply to the Maryland Racing Commission for approval of any live racing or simulcasting days past June 4, either at Pimlico or Laurel Park, fueling speculation as to what the next move be.

The Racing Commission is required to award 180 live racing days each year to Laurel and Pimlico — with a minimum of 40 going to Pimlico — though there are circumstances that can allow those number to be lower, through mutual agreement of the commission and track owner.

With the clock ticking on the operations agreement, the General Assembly this year created the Maryland Thoroughbred Operating Authority, a panel with sweeping powers that would keep racing operating, should the negotiations reach an impasse. Appointments to the new board, which comes into existence June 1, are expected to be made very shortly.

The state apparently already has the legal authority to take the tracks through eminent domain under a 2009 section of Maryland law governing business regulation — Md. Business Regulation Code Section 11-521, “Condemnation of Private Thoroughbred Racing-Related Property for Public Use” — but such condemnation is viewed by most as a somewhat unrealistic “nuclear option.”

Aside from some back-and-forth about whether and how long the expiring agreement might be extended, the focus of recent negotiations has been a Maryland Jockey Club proposal for the horsemen and breeders to give up a greater percentage of their share of purses — racing’s prize money — to offset the cost of track operations, people with knowledge of the discussions said.

Purse money comes from a variety of sources, including a state subsidy from gaming proceeds. Generally, 6% of the state’s revenue from video lottery terminals (VLTs or slots), not to exceed $100 million, goes to subsidize purses through the Purse Dedication Account, under the authority of the Racing Commission. For the fiscal year that begins July 1, the state has budgeted $81 million for the total subsidy to both the thoroughbred and standardbred tracks.

“I will tell you without any hesitation, it is the most complex … project I have ever worked on,” Alan M. Rifkin, the lawyer-lobbyist representing Stronach, told Maryland Matters earlier this year.

Uncertain future of Maryland racing hangs over Preakness celebration
The betting windows were lightly trafficked on May 11, the opening day of the spring live-racing meet at Pimlico. Photo by William F. Zorzi.

Attendance dropping

Last week at the May 11 opening day of Pimlico’s 15-day spring live-racing meet, the sunny, warm weather made for a perfect day at the track, but attendance was dismal, reflecting the downward trend of both betting and attendance at Maryland’s horse racing courses.

Nevertheless, some diehard racing fans were sprinkled along the rail and around the outside seats and at picnic tables, poring over the Daily Racing Form, leaving to place their bets, and just plain taking in the ambience of a day at the races.

Uncertain future of Maryland racing hangs over Preakness celebration
Linda S. Schwartz, left, and April I. Smith, right, sit trackside on Pimlico spring meet’s opening day May 11. Photo by William F. Zorzi.

Seated at one of the red plastic-coated picnic tables out on the apron below the grandstand was Linda S. Schwartz, 78, a retiree who lives near the Pimlico track and stops by when the horses are running.

“I was surprised by the attendance,” Schwartz conceded, though she is grateful there are no crowds. “Today is a bad day to judge whether the sport is viable.”

After all, it was a Thursday, a workday for many people. “I think attendance and wagering will increase as the weekend approaches,” Schwartz said.

After studying the day’s Pimlico program, she used her smart phone to make a small wager, saving herself the trouble of walking a betting window.

“I can’t bear the thought of losing this wonderful sport,” said Schwartz, a volunteer at Days End Farm Horse Rescue in Woodbine, Howard County, who felt so strongly about Old Hilltop that she joined the Friends of Pimlico group to help save the track. “I would be broken-hearted if it ceased to exist.

“I feel like I belong here,” the self-described “horse junkie” said. “Where else can you go to see a human and a horse in such a relationship?”

April I. Smith, a horse lover and one of the founders of Friends of Pimlico, sidled up and sat next to Schwartz.

Dressed in a “Pimlico 1870” baseball cap and Pimlico-themed T-shirt, Smith took issue with the characterization of racing as a dying sport.

“I happen to think it’s a sport waiting to be rediscovered,” said Smith, who is also a guide for the Sunrise at Old Hilltop Tours, a behind-the-scenes look at Pimlico on the four mornings before the Preakness.

But Smith’s cheerleading might be wishful thinking.

In the 15 years before the pandemic shut down the tracks in 2020, the amount of wagering at each of the tracks dropped precipitously, as did the attendance, according to annual reports from the Maryland Racing Commission, the state’s regulator.

At Pimlico, the amount wagered at the track plunged 84.9%, from $120.4 million in 2005 to $18.2 million in 2019, and track attendance took a similar dive, sinking 73.4%, from 470,514 in 2005 to 124,952 in 2019, the commission reports showed.

At Laurel, betting at the track fell 64.2%, from $175.5 million in 2005 to $62.8 million in 2019, and attendance at the track dropped 64.2%, from 769,814 in 2005 to 275,214 in 2019, the agency reported.

The latest numbers available from the Racing Commission show that in 2021, at-track wagering and attendance made modest improvements over the disastrous 2020, but still far below where it had been in 2019.

Statistics for 2022 were not yet available, said J. Michael Hopkins, the commission’s executive director. Without that information, it is impossible to assess the effect of legalized sports betting in Maryland, which began in December 2021.

Attendance numbers are supplied to the commission by the tracks, Hopkins said.

Attendance at the Preakness has stayed strong, according to figures released by Pimlico over the years. In 2005, 125,687 made the race, compared to 131,256 in 2019. There were no spectators in 2020 because of COVID-19 and the crowd was limited to 10,000 in 2021, though that year saw a record $68.7 million wagered, an amount that included all bets, both from the track and off-site locations, for the Preakness Stakes’ 1-3/16-mile dirt track race.

Last year, the Preakness attracted more than 60,000 race-goers, and $65.3 million, down roughly 5% from the year before.

The record attendance for the Preakness was 140,327 in 2017, according to information released by Pimlico.

Hopkins could not say how the Preakness attendance numbers were reconciled with the lower annual Pimlico attendance.

Changing attitudes

Over the last nearly 40 years, racing industry officials have returned to Maryland General Assembly time and again, hat in hand, with dire warnings of possible losses to other states, should they not prevail with whatever request they were pitching to the legislature: Sunday racing, telephone betting, intertrack wagering, purse enhancements, simulcasting, legalized slots.

Frequently accompanying the requests were grand plans for extensive capital improvements, plans that never seemed to come to be, except in some small way.

Uncertain future of Maryland racing hangs over Preakness celebration
The statue “Secretariat Racing into History” was sculpted and cast by Jocelyn Russell and is being displayed at each of the Triple Crown racetracks — Churchill Downs, Pimlico Race Course and Belmont Park — on race day this year, the 50th anniversary of the horse’s record-breaking win in the 1973 Triple Crown. This casting, which displays the No. 2 that Secretariat wore at Belmont, will be permanently displayed at Ashland, Virginia, the horse’s birthplace. Photo by William F. Zorzi.

Those were the days when the racing industry had key legislators it could count on, lawmakers who would carry water for the tracks and ensure the ask was satisfied. But the industry does not have the same support — or even interest — it once had in the General Assembly.

Former Senate President Thomas V. “Mike” Miller (D-Prince George’s, Calvert) was a key ally for the industry, though not the only one by any means, but certainly the most powerful.

By contrast, earlier this year, during the legislative session, Senate President Bill Ferguson (D-Baltimore City) made a point of telling a small group of State House reporters how he had noticed the change in the relationship between the racing industry and the legislature.

“It’s been interesting to me to see there’s just less engagement on the issue than there once was, and but for the Preakness, you know, I think that there is a waning level of engagement amongst legislators in Maryland,” Ferguson said. “I think that that’s something that’s not good for the thoroughbred racing industry or the agricultural community that depends on the thoroughbred racing industry to survive.

“We’re at a very precarious moment, and I don’t know what the end is,” he said. “I think that’s interesting that nobody asked about it, because in prior years, it would be a major focus.”

Things had changed, Ferguson pointed out.

“Things have moved on with sports betting and other related entertainment venues with casinos and table games and all that,” he said. At one time, “horse racing was the only place where, if somebody wanted to be entertained and gamble, that was kind of the only legal place to do it in the state of Maryland.”

Ironically, gambling now supports horse racing and has “stabilized it” and “kept it alive” over the last 10 years, he said. But with the last 10-year agreement expiring June 30, “I think there’s a major decision point looming about what the future looks like,” he said.

“I don’t think there’s a Maryland horse racing future that involves the current players in the system,” Ferguson said.

Remarkably, his comments drew little to no attention in the press.