After coming to a tenuous agreement last year to allow 146 days of live racing at the state’s two thoroughbred tracks, the racing industry is back with a long-term plan.
Gov. Martin O’Malley (D) announced a 10-year agreement Friday. The deal provides for 146 days of live racing at Pimlico Race Course in Baltimore and Laurel Park for 2013 and then slides into a 100-day minimum that will be enhanced through a revenue-sharing program for the duration of the agreement.
“Today is a great day for Maryland’s racing industry,” O’Malley said in a statement. “I applaud the incredible work of all the parties in reaching a deal that retains racing industry jobs and preserves the future of racing in Maryland for years to come.”
The deal provides track owner Frank Stronach, who owns the Maryland Jockey Club, which manages Laurel Park and Pimlico, with the long-term assurance that the horsemen share Stronach’s goal of profitability, said Alan Foreman, general counsel for the Maryland Thoroughbred Horsemen’s Association, referring to Stronach’s need for a reliable funding method.
Through the deal, Stronach guarantees 100 live racing days from 2014 through the 2023, with the subsidies for more days coming from revenue-shared aspects such as betting revenues and casino money. Foreman anticipates a minimum of 146 days each year going forward.
Under the agreement, Bowie Training Center will be closed, with additional stables being built at Pimlico to allow for 1,900 stalls between the two tracks throughout the length of the deal. The General Assembly must approve the center’s closure, which is expected to occur gradually during the next year.
Foreman said the hope is to accommodate as many people from Bowie as possible and create a smooth transition.
The deal also allows Stronach to invest in capital improvements for the tracks, especially Pimlico, he said. Stronach must present a capital improvement plan by Feb. 1.
“We created a plan that benefits everyone and develops a sustainable model for the future,” Tom Chuckas, president of the jockey club, said in a statement.
Mike Rogers, president of The Stronach Group, was not available for comment, but Stronach issued a statement that he was pleased. “This shows our commitment to Maryland racing and the long-term future of the industry,” he said.
“This essentially protects year-round live racing in the state for the next decade,” Foreman said. “We’re pleased at knowing we won’t have to have the annual battle over the number of racing days and the fight to keep the tracks open.”
The racing industry, which employs about 15,000 people at the tracks, has faced ongoing uncertainty throughout the years, as revenues declined. In many cases, arguments about how to fund the tracks have come close to the last possible moment that a racing schedule could be approved. Last year’s agreement required the horsemen’s association to pay the jockey club $4 million through monthly installments in 2012. The money came from the association’s purse account.
At the time, Foreman said the 2012 deal was so everyone could have additional time to develop a more stable plan. The industry has done this, he said Monday.
Members of the racing industry, including those with the horsemen’s association, Maryland Horse Breeders Association and Maryland Racing Commission met with each other and state government liaisons for 11 months to broker a deal. During that time, the horsemen’s association saw the resignation of both its president, Richard J. Hoffberger, and executive secretary, Wayne W. Wright. Both men, however, remained through the negotiations.
“The best thing about the whole thing is it gives the framework, structure and basis we need and gives us a stability to build from,” said racing commissioner Bruce Quade, who was part of the negotiations. “It’s a cool thing.”
He praised O’Malley’s administration and the General Assembly for their work in getting all those involved “to where we can strike this deal.”
The long-term stability is particularly critical to Maryland’s horse breeders, because breeding can require a commitment of at least four years, said Cricket Goodall, executive director of the horse breeders association.
“This deal is unprecedented. We’re getting congratulations from other states,” she said. “We’re looking forward to a positive future.”
The deal will go before the racing commission for approval Tuesday afternoon at Laurel Park.