Battle Over Maryland Slots Heats Up
Photo: Anne M. Eberhardt

The Maryland Jockey Club said Dec. 17 it has appealed to the Maryland State Board of Contract Appeals over its disqualification from the bidding process for a license to operate slot machines at Laurel Park.

Meanwhile, during a press conference at Laurel, MJC officials made their case as to why the racetrack, not the Arundel Mills Mall, is the best option for a slots facility. The push comes as the Anne Arundel County Council prepares for a Dec. 21 vote on a zoning change that would permit the mall project proposed by Cordish Cos.

The MJC, operating as Laurel Racing Association, earlier this year challenged the legality of a provision in the state gaming law that called for each bidder to submit a licensing fee. Laurel Racing submitted a bid for slots but didn’t include the fee, which is based on the number of machines in each application.

The MJC has maintained if had paid the fee but wasn’t selected as the winning bidder, it would have forfeited the $28.5 million, and if it didn’t pay the fee, it risked disqualification and had no recourse.

A state commission that awards slots licenses refused to allow Laurel Racing to place the $28.5 million in escrow.

“This appeal asserts that the location commission’s refusal to follow standard procurement procedures, and in waiving certain bid requirements for other bidders, acted in an arbitrary and capricious manner in violation of (Laurel Racing’s) legal and constitutional rights,” the MJC said in a statement.

Laurel Racing attorney Alan Rifkin said the association believes the MJC bid will be reinstated or the bidding process for the county slots license will be reopened.
 
The Dec. 17 press conference was part of a flurry of activity concerning the slots license and the possible Jan. 8 auction of Laurel Park and Pimlico Race Course by bankrupt owner Magna Entertainment Corp. Six entities have submitted bids for the MJC tracks, but that doesn’t mean they will be sold.

On Dec. 19, the horse industry is holding a rally at Laurel in support of slots for the track.

“The significance of this rally cannot be overstated,” Maryland Horse Council president Steuart Pittman Jr. said in a statement. “There never has been a greater threat, or a more misguided threat, to Maryland’s tradition of Thoroughbred racing. It is aimed at our flagship track in the county where Maryland racing began.”

During the press conference, the MJC officials and others said Laurel could have slots operating much quicker than the Arundel Mills Mall site because it already has multiple state and local approvals in place. Laurel Park project manager Walter Lynch said it took the track more than five years to get those approvals in place in advance of a slots parlor.

In published reports, officials with Cordish Cos. said the Arundel Mills Mall project could proceed quickly after zoning approvals are received. They also said the location is better for slots than Laurel.

Cordish is one of the six bidders for the MJC tracks.

“We are going to be a very high bidder, but not to move the slots,” developer David Cordish told WBAL-11 in Baltimore. “They belong at the Mills. But at the same token, my right hand—which will be the Mills—will be sending money to the two tracks, and we can make them very entertainment-friendly.”

Cordish and others have said it’s possible the mall site, because of its location and 4,750 machines, could generate more money for racing than the Laurel operation. The horse racing industry would get up to $100 million a year if all five slots locations are developed and fully operating.

“The Mills is going to create 4,000 jobs that could be created (at Laurel),” MJC president Tom Chuckas said in a statement. “The risk is you are destroying 15,000 jobs (in the racing industry). The best move from our perspective is vote no on (the zoning change), wait, and allow us back in the bidding process.”
 
Joe Weinberg, who works for Cordish Cos., told the Washington Post claims that Laurel can’t survive without slots are false. He noted six entities bid for the track knowing the situation surrounding the slots licensing process.

Maryland lawmakers have indicated there could be changes, including the addition of locations for slots parlors.

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