ANNAPOLIS – Maryland Gov. Martin O’Malley’s administration is proposing legislation that would allow racetrack owners to dip into slots revenues, in return for keeping the horse tracks open. “It is becoming harder and harder … to see racetracks that are profitably operating without gaming,” O’Malley’s chief legislative officer, Joe Bryce, told the Senate Budget and Taxation Committee on Wednesday. “That is a reality of how the racing industry is structured now.”
O’Malley’s fiscal 2012 budget would funnel $3.6 million in slots revenues slated for track maintenance to Ontario’s MI Developments and Pennsylvania’s Penn National Gaming, which jointly own Laurel and Pimlico racetracks.
The funding ensures the companies will keep the tracks open for a full 146-day racing schedule this year, Bryce said.
He said O’Malley is submitting another bill that would continue a similar revenue-sharing agreement to lock in a full racing schedule in future years.
“They own the stadium, if you will, and no one can play without a stadium,” he said.
Maryland’s other two tracks — Ocean Downs and Rosecroft Raceway — also need cash infusions. Rosecroft closed in July after declaring bankruptcy, and is scheduled to be auctioned off on Friday. O’Malley’s administration is submitting legislation that would allow the owner of Ocean Downs and the future owner of Rosecroft to plug falling profits with up to a quarter of slots revenues slated for purse accounts.
The legislation would permit Ocean Downs and Rosecroft to borrow up to $1.2 million each for operating expenses, according to Maryland Secretary of State John McDonough.
The future owner of Rosecroft also would be awarded with a loan of up to $4 million from the purse account to help reopen the track and hire back its laid-off employees.
The loan would be available to Rosecroft for roughly four years, or about as long as it takes for the harness-racing track to become profitable again.
But Sen. James DeGrange, D-Anne Arundel County, questioned whether the horse racing industry would ever again be profitable — in Maryland or anywhere else.
“The health of the horse racing industry is not very good,” Bryce said.
Sen. David Brinkley, R-Carroll and Frederick counties, blamed lawmakers for not passing a bill allowing for slot machines at racetracks.
“The ultimate responsibility lies here,” he said, calling the state’s plan “a Band-Aid on an arterial bleed.”
Bryce said a long-term fix would have to add slots or table games to racetracks.
