Battle Brewing Over Proposed Michigan Track

Magna Entertainment Corp. chairman Frank Stronach wants to get things moving with his company's proposed racetrack in Romulus, Mich., but state racing commissioner Robert Geake reiterated Thursday that much remains to be accomplished before any action can be taken.

Stronach discussed MEC's plans for a combined Thoroughbred/Standardbred track in suburban Detroit with Michigan Gov. Jennifer Granholm Wednesday, but a spokesperson after the meeting told the Detroit Free Press the governor has not taken a position on the matter. Stronach said before the meeting MEC is "getting jerked around" by Michigan officials.

Geake maintains further information is needed before the process can move forward, specifically regarding the proposed transfer of MEC's license for Great Lakes Downs in Muskegon to a company led by longtime Stronach-associate Jack Brothers. Geake said he requested clarification of the transfer in a letter dated March 12 but has yet to hear back from MEC.

"Mr. Stronach was in Lansing complaining that this office has not acted to approve the transfer of its Muskegon license, but we have to be satisfied that Magna is truly divesting itself of the one track," Geake said. "I requested in writing they clarify the proposal so we can clearly establish that it would be an arms-length transaction."

Michigan law prohibits the ownership of multiple track licenses. However, a bill being debated by the state legislature that would allow video lottery terminals at the state's racetracks also includes a provision allowing for multiple racing licenses.

"Magna Entertainment has two shots at this -- one is the legislation, if its passed, and the other is to divest itself of (Great Lakes Downs)," Geake said.

Lorne Kumer, vice president of real estate for MI Developments, the parent company of MEC, did not immediately return phone calls Thursday.

Further complicating Geake's decision is whether a track in Romulus would be viable if the alternative gaming legislation is not passed. "This office has to be satisfied the proposal is financially sound before it can be approved," Geake said.

MEC has proposed a $100-million dual-breed racetrack called Michigan Downs. The facility would include a 1 1/8-mile dirt track for Thoroughbreds and seven-furlong harness track. There would also be a one-mile turf course. If demand warrants, a 675,000 square-foot retail and entertainment complex would be built later.