Pimlico Clubhouse

Pimlico Clubhouse

Anne M. Eberhardt

Parameters of Maryland Agreement Discussed

State's Jockey Club to receive more than $5 million for operation of 146-day meet.

The Maryland Jockey Club will receive more than $5 million for operations under the parameters of a negotiated agreement that will maintain a full 146-day live Thoroughbred racing schedule in the state.

The deal, pushed by Maryland Gov. Martin O’Malley and signed Dec. 22, was approved by the Maryland Racing Commission later in the day. The details of the agreement, which covers one year through Dec. 31, 2011, were discussed during the racing commission meeting.

MJC president Tom Chuckas outlined the agreement. The Maryland Thoroughbred Horsemen’s Association and Maryland Horse Breeders Association will contribute $1.7 million to the MJC in 2011 to support live racing at Laurel Park and Pimlico Race Course. The funds will be paid monthly.

The agreement is based upon allocation of $3.5 million to $4 million in revenue from slot machines at casinos in Maryland. Currently, only one is operating in northeastern Maryland, while a second, at Ocean Downs harness track on the Eastern Shore, plans to open in January 2011.

The money will come from 2.5% already earmarked for racetrack capital improvements, so legislative action is required. Purses and breed development earn 7% of slots revenue from up to five casinos, the number currently allowed by law.

Chuckas also said the Maryland THA has consented to ongoing export of Maryland’s live races as well as continuing operation of in-state satellite wagering facilities. The MJC, he said, “agreed to maintain current stabling operations (at Laurel and the Bowie Training Center) through 2011 subject to legislative changes.”

MJC partners MI Developments (51%) and Penn National Gaming Inc. (49%) would prefer to close the Bowie operation to save money--roughly $2 million a year, they said. To do so, however, requires action by lawmakers.

“We are cognizant of the fact that whatever transpires at Bowie will take a joint effort of the industry partners,” Chuckas told the MRC. “It is our belief that if there are any legislative changes that occur at Bowie, it would be a joint effort of the participants of the Maryland Jockey Club, the horsemen, and the breeders to make that happen.”

Maryland THA general counsel Alan Foreman confirmed the agreement. Foreman has been critical of the MJC parent companies, alleging their dysfunction led to the near-shutdown of Maryland racing, but he credited Chuckas, the on-site point man at the two tracks, for his role in bringing about a resolution.

“Tom Chuckas has probably been in the most difficult position of any of us,” Foreman told the MRC. “You see how the dynamics have played out, and he’s trying to represent his organization. I think if we had been able to negotiate with Tom exclusively, we would have wrapped this up a long time ago. He deserves a lot of credit for hanging in under difficult circumstances.”

“Hopefully we can use this as a basis of a foundation to move forward to maintain the proud tradition and heritage that is Maryland racing,” MRC chairman Louis Ulman said.

Laurel will open as scheduled Jan. 1, 2011. The first condition book reflects the purse structure that was in place in 2010.

MJC officials indicated the 2011 stakes schedule in Maryland would be discussed the week of Dec. 27. It is known that the grade I Preakness Stakes, second leg of the Triple Crown, is slated for May 21 at Pimlico.

Racing already has earned some purse revenue from slots at the PNGI-owned Hollywood Casino at Perryville, located just north of the Susquehanna River not far from the Delaware line. The facility opened at the end of September.

After two months and four days through Nov. 30, the casino generated $1.47 million for purses and breed development and $526,000 for the “Racetracks Facility Renewal Account,” or capital improvement fund, according to Maryland Lottery figures. The money is paid 80% to Thoroughbred racing and 20% to Standardbred racing in keeping with current splits in simulcast revenue, meaning Thoroughbred purses and breed development earned $1.17 million in about two months.

During the period, the state, which gets 48.5% of slots revenue, earned $10.2 for an education trust, while operator PNGI, which keeps 33% of the revenue, received $6.9 million.