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Maryland Legislature Approves Plan to Reform State Racing Industry

A bill to radically reform Maryland's racing industry has passed both chambers of the state legislature, with the House voting 105-32 Monday night to approve a project that will see among other things ownership of Pimlico Race Course transferred from 1/ST Racing and Gaming to the state and the establishment of a year-round training facility for Maryland's horsemen and women.

After the Maryland House of Delegates initially passed the legislation unanimously, the bill was subsequently amended by the Senate. This amended bill was then sent back to the House for Monday's concurrence vote.

The legislation will now go to the desk of Maryland governor, Wes Moore, for a final signature, with a veto seemingly unlikely.

“I've worked with governors going back to the mid- to late-1970s in Maryland, and most were very supportive of the industry in one shape or form. But Governor Moore was absolutely committed to this project. His support was instrumental in getting this passed,” said Alan Foreman, voting member of the non-profit Maryland Thoroughbred Racetrack Operating Authority (MTROA), about passage of HB 1524, otherwise known as “Pimlico Plus.”

The MTROA is an industry-led non-profit created last year by the legislature to essentially oversee and help facilitate the Pimlico Plus plan. Pending gubernatorial approval, the rollout of the plan will be a multi-year project beginning June 1, when the law goes into effect.

Among key provisions of the plan, the legislation requires the formation of a non-profit to manage daily operations of Maryland's new industry infrastructure. Those responsibilities are currently filled by the Maryland Jockey Club, owned and operated by 1/ST Racing. The MTROA will have ultimate oversight of this new entity.

“Like the [New York Racing Association] reports to the franchise oversight board, the entity to be created in Maryland will report to the MTROA,” said Foreman.

Though much-needed renovations to Pimlico could begin later this year, said Foreman, the 2025 Preakness is still expected to be staged at the Baltimore track, with the 2026 edition set to be hosted temporarily at Laurel Park.

“After Preakness 2025, Pimlico will undergo full construction, and the plan is that the 2027 Preakness will be at Pimlico under the auspices of the new non-for-profit.” said Foreman. “For the horsemen, racing will be conducted at Laurel for the next three years.”

Like Pimlico, Laurel is currently operated by 1/ST Racing under the umbrella of The Stronach Group (TSG). Transfer of Pimlico from 1/ST Racing to the state comes at a nominal one-dollar price-tag.

The MTROA has already negotiated a licensing agreement with 1/ST Racing to operate and promote the GI Preakness S. and the GII Black-Eyed Susan S., Maryland's two signature races.

“It's a 10-year agreement with five-year renewals,” said Foreman. “After ten years, if the state wanted to buy it out, it could. But any renewals would be for five-year intervals.”

Complementing a revamped Pimlico will be the selection of a year-round companion training facility to accommodate the horses not stabled at Pimlico. According to Foreman, some 1,300 horses are expected to be split evenly between the two facilities.

The MTROA has identified eight potential training facilities for purchase, rating them by several criteria, including their location, size, cost to purchase and cost of redevelopment. According to this rating system, two facilities come out jointly on top: Shamrock Farm and Mitchell Farm Training Center.

Shamrock Farm Training Center is a 155-acre facility just over 20 miles from Pimlico. Mitchell Farm Training Center is a 97-acre facility near the Aberdeen Proving Ground. The third-rated facility is the Bowie Race Track, a 131-acre training facility.

The legislation also allows the Maryland Stadium Authority–a state-founded entity to help fund and operate key building projects in Maryland–to issue $400 million in bonds to help bankroll the Pimlico Plus plan.

Ultimately, ownership of Laurel Park will be transferred fully to TSG for redevelopment at the beginning of 2028, “unless we have to extend the lease,” said Foreman.

According to Foreman, state taxpayers won't be on the hook should the non-profit formed to manage daily operations going forward run into operating deficits.

“If there's an operating loss when the non-for-profit takes over, the Thoroughbred purse dedication account has to backstop the losses. It will not come from taxpayer dollars,” said Foreman.

“I can't overstate the historical moment this is for Maryland racing. It's historical for the City of Baltimore. This is great for the City of Baltimore. It stops decades of worries about Pimlico and the future of the Preakness in Maryland and Baltimore. It's great for the Park Heights community. And I think it's great for the racing industry overall,” said Foreman.

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Report: Churchill Downs Enters Late Bid To Purchase Pimlico

According to an article written by Pamela Wood of The Balitmore Banner on Wednesday, Apr. 3, Churchill Downs Inc. has made an “overture” to buy Pimlico, the Home of the Preakness Stakes. The report says the information comes from two unnamed sources in the Maryland state capital familiar with the negotiations.

Wood writes that one of the sources said Churchill has been lobbying to derail a bill in the state legislature that's necessary for the state ownership deal to go through.

The article says that representatives of Churchill Downs did not respond to multiple voicemail and email messages seeking comment on the company's interest in Pimlico.

At this point, Wood writes, it is not clear how serious Churchill Downs's interest is or whether the company made a formal or informal offer to Pimlico or the state about buying the track. She claims that some in Annapolis have privately expressed skepticism about Churchill's motives, given that it has many more casinos than racetracks among its properties.

The piece goes on to quote Craig Fravel, Executive Vice Chairman of Stronach's 1/ST Racing and Gaming. Fravel issued a statement Wednesday that there was no pending offer from Churchill Downs to his company, which is “not in any negotiation with them. We remain committed to the contemplated transactions as negotiated,” he said.

The Banner article goes on to explain that Churchill's involvement could complicate efforts to execute the state takeover plan for Pimlico, which involves legislation that's pending in the final days of the Maryland General Assembly session.

Wood states that several lawmakers have expressed reservations about the state taking over the track and running Thoroughbred racing, along with some elements of the plan to pay for hundreds of millions of dollars in renovations.

The piece also says that a bill passed (104-34) the House of Delegates on Monday night and is facing unknown odds in the Senate.

Senate President Bill Ferguson told reporters Tuesday, “It's going to be some tough conversations here in the next few days to figure out if there is a clear path forward.”

Wood said that Ferguson would not offer a timeline for the Senate's consideration of the bill. The end of the General Assembly's annual legislative session is approaching at midnight Monday, Apr. 8.

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Differences Over ‘Pimlico Plus’ Project, Proponents Say ‘We can’t let perfect get in the way of good’

Acknowledging that there are differences of opinion about specifics of the “Pimlico Plus” plan that envisions a publicly funded future of racing at a state-owned, modernized track in Baltimore, the construction of a new training facility elsewhere, and a non-profit operator taking over day-to-day racing, the leaders of the Maryland Thoroughbred Racetrack Operating Authority (MTROA) on Thursday asked stakeholders not to let quibbling over details derail the larger goal of getting the ambitious plan approved by the legislature so that horsemen can control their own destiny.

“There are a lot of skeptics,” said Alan Foreman, who is the general counsel for the Maryland Thoroughbred Horsemen's Association (MTHA) and is also that group's representative on the MTROA. “Some of the critics have already come out very quickly without letting us continue to do our work. My own personal perspective is the status quo in racing is simply not going to survive going forward. We have a once-in-lifetime opportunity here. This will not present itself again. And we can't let the perfect get in the way of the good.”

The MTROA's vision for the $400-million makeover, which was made public in a Jan. 5 report, has a number of key components coming into alignment right now, Foreman said.

There is support from the Maryland governor, the speaker of the House, and the president of the Senate, Foreman said.

In addition, The Stronach Group (AKA 1/ST Racing and Gaming), which owns Pimlico Race Course and Laurel Park, has agreed in principle to an exit strategy that would turn over ownership of Pimlico to the state and cede control of daily Thoroughbred racing operations to an entity that would function similarly to the New York Racing Association (NYRA).

In exchange, The Stronach Group would be allowed to eventually sell or redevelop Laurel while retaining rights for Maryland's two signature races, the Preakness S. and the Black-Eyed Susan S. Those rights would then be leased back to the new operating entity.

Despite the momentum the project seemingly has going for it, Gregory Cross, the MTROA's chair, warned that getting Pimlico Plus signed into law is far from a slam-dunk.

“It's an extremely, extremely difficult budget year,” Cross said. “We're lucky to be preserving what we have [and] fitting it [into] what has been allocated-very lucky.”

Foreman agreed: “We're really threading the needle here, folks.”

Added Cross, “While we have been given some support, it's far from an assurance of passage, so we've got a lot of work to do.”

That work, Foreman, said, includes not just the passage of legislation, but acquiring and beginning development on a training center, engaging a design consultant to flesh out the reimagined Pimlico beyond the broad concept that is currently on paper, signing off on negotiations with The Stronach Group, and putting together the non-profit operating team.

The MTROA would like all of that done by Jan. 1, 2025.

“There are only two states in the country where there is any forward-thinking development going on,” Foreman said. “NYRA, which is rebuilding Belmont, and now it's going to be Maryland racing. We have a very unique opportunity to position Maryland racing for the future. Through this project, I think we guarantee at least a portion of our funding base with the General Assembly. [But if] we didn't do this, we wouldn't be protected going forward.”

The MTROA envisions between 140 and 160 racing dates per year at Pimlico.

Foreman said the alternative, based on a presentation The Stronach Group made to the MTHA, would nearly slice that number in half.

“The Stronach Group's vision of the future is a maximum of 80 live racing dates in Maryland,” Foreman said. “Two 40-day boutique meets, with a shift of [gaming] revenue from the horsemen and breeders to them, to make them profitable. Under the current scenario, they do not see a way in which they would invest any money into the Maryland tracks. So we would be essentially at the status quo if we don't do any of this.”

Foreman continued: “Can you sustain live racing, and can you sustain a breeding industry, on 80 live racing days with vastly inflated purses, which is going to squeeze out the middle and the small horsemen, and bring probably large, out-of-state outfits into the state of Maryland? Where [else] do we think we can do something where we can control our own destiny and make this work?”

Foreman said he “firmly believes” Pimlico Plus is feasible. He further noted that the MTHA currently pays “$11-plus million” in subsidies to the Stronach Group just to conduct basic operations that keep the sport running at Laurel (which has been besieged by main-track safety issues for years) and Pimlico (which is outdated and hosts racing only for brief meets in the spring and September).

Still, the horsemen in attendance for the Jan. 11 videoconference had no shortage of concerns. Chief among them was housing for stable workers.

Last week's report stated there would be no housing actually on the backstretch at Pimlico. It would be nearby, in a neighborhood widely considered to be dangerous.

The report also identified three top candidates for training centers (Shamrock Farm in Woodbine, Mitchell Farm in Aberdeen, and the former Bowie Race Track in Bowie), but none of them would include dormitories for workers.

Trainer Ferris Allen put it this way: “I think the [MTROA] needs to understand that a lot of our employees are on foot or on bicycles. They don't drive. They work on H-2B visas and things like that. So on-site housing is a very essential part of running our business.”

As for Pimlico, Foreman said, “Working with the city, the plan is to incorporate backstretch housing into the community, contiguous to the racetrack. But that's all going to be part of a much more complete and dynamic redeveloped area, and not what you see in that area right now. It is a unique concept, one that we think will work, and one that will have to be fleshed out as we go forward.”

Regarding the training centers, Cross said, “At this time there's no money for that. It's a $25- to $30-miliion cost. And the zoning is very questionable as to whether it would be allowed.”

David Richardson, the executive director of the MTHA, who was moderating questions as they came in during the video conference, added that, “I will say I'm getting inundated with texts and comments about the need for backstretch housing at the training facility. If there's any feedback from horsemen, it's how crucial [the housing] component is.”

Foreman and Cross both indicated the MTROA would take into account the horsemen's concerns about housing going forward.

Other questions from horsemen included wanting to know specifics about the Preakness and Black-Eyed Susan S. licensing deals, but the MTROA didn't disclose many specifics.

“I don't want to get into too many details on that, but essentially we would be paying an annual fee [in exchange for] full control over the Black-Eyed Susan, the Preakness, and we would have full control over all revenue streams,” Cross said. “They're going to donate Pimlico to this new operating authority. We're going to license the Preakness. That's the essence of the deal.”

Asked if there was any consideration given to pushing back the proposed construction by a few months so Pimlico could capitalize off the 150th running of the Preakness at Pimlico in 2025, Cross said that idea would be too costly in terms of money and time.

“At the end of the day, we decided to model after Belmont, which is closing for two years and then coming back. And that is going to allow us to complete the construction on a timely basis,” Cross said.

But even though the plan calls for Pimlico to reopen in 2027, no deadlines are etched in stone at this early stage of the project.

Foreman said that even if Pimlico wasn't completely renovated in time for a grand reopening in May 2027, he expected it would be “at least in [a] phase [of partial usage] that we would still be able to accommodate the Preakness.”

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Latest Version of Maryland Remake: Pimlico Sole Track under Non-Profit Control, with 1/ST Racing out of Daily Ops

This story is a deeper dive into the joint press release issued earlier Jan. 5 by The Stronach Group, the Maryland Jockey Club, and the Maryland Thoroughbred Racetrack Operating Authority.

The latest recommendation in a years-long attempt by multiple stakeholders to consolidate Maryland racing at a single, reimagined racetrack now calls for a project dubbed “Pimlico Plus,” with racing centered in Baltimore and supported by the construction of a new training facility elsewhere in the state, according to a report issued by the Maryland Thoroughbred Racetrack Operating Authority (MTROA) Jan. 5.

The ambitious remake of the sport's infrastructure in Maryland hinges upon legislative approval, although the report did come with the endorsement of Maryland's governor, Wes Moore.

Another key to the deal would require 1/ST Racing and Gaming, which owns Pimlico Race Course and Laurel Park, to transfer ownership of Pimlico to the state, and for 1/ST Racing to cede control of its day-to-day Thoroughbred operations to a to-be-created, non-profit entity as of Jan. 1, 2025.

The report stated that 1/ST Racing is amenable to “a framework for an agreement in principle” for those transfers to happen.

In addition, the state would negotiate a licensing agreement with 1/ST Racing to operate and promote the GI Preakness S. and the GI Black-Eyed Susan S., Maryland's two signature races.

Laurel Park would be maintained as “a transitional facility for live racing and training during the expected four-year construction and transition period,” the report stated.

The Washington Post reported that if all went according to plan, Pimlico would be shut down after this year's Preakness on May 18, with the 2025 and 2026 editions of the race temporarily shifting to Laurel.

After that, the MTROA report stated, Laurel will likely be redeveloped.

Complementing the rebuilt Pimlico's projected 700-horse stabling capacity would be the construction of a new training facility at a to-be-determined location that can house 650 horses “in reasonable proximity to Pimlico that would also be acquired and developed under a non-private ownership structure,” the report stated.

The report stated that the cost for the entire project would be “significantly below” previous concepts proposed in recent years that involved keeping both Pimlico and Laurel running “and within the range of General Assembly allocations.”

A story in the Baltimore Banner gave a more specific breakdown: “The new Pimlico comes with a price tag of $274 million to $284 million, while the training facility would cost about $113 million–in line with $400 million in state subsidies previously set aside for the renovation of Pimlico and Laurel.”

The concept of consolidation in Maryland has been openly discussed for the better part of a decade. 1/ST Racing (known as The Stronach Group when it took over in Maryland in 2002) has been on the record for years as acknowledging the sub-optimal conditions at outmoded Pimlico, which as recently as 2018 raced only 12 dates for an abbreviated meet surrounding the Preakness.

Initially, The Stronach Group invested tens of millions of dollars in upgrades at Laurel while publicly stating that the company did not foresee putting any of its own funds into an overhaul of Pimlico.

Civic and state officials, fearful of Baltimore losing the Preakness to Laurel, helped to push for the years-long commissioning of several years of studies for a publicly funded solution led by the Maryland Stadium Authority (MSA). In 2019, Baltimore's mayor even tried to sue Pimlico's ownership in an attempt to force a city takeover.

As the MTROA report explained, “After many iterations, an agreed-upon program was finalized in late 2021 and estimates were generated. The estimates were significantly over the available bonding capacity for the project.”

The Maryland General Assembly then called for additional input and yet more studies in 2022, and that year, the Maryland Thoroughbred Horsemen's Association (MTHA), the Maryland Horse Breeders Association, and others proposed an alternative scenario that would maintain year-round training and racing at both facilities.

“In total, six scenarios have been analyzed by the MSA [and] all of them significantly exceeded available project funding,” the MTROA report stated. It also concluded that “given the level of State investment required to rehabilitate and sustain the industry, a public ownership structure for the tracks and subsequent lease of them to a nonprofit entity led by Maryland industry professionals is the best path forward.”

The report stated at least one significant reason why 1/ST Racing would agree to give up Pimlico: The company would be on the hook for huge taxes if the state provided any funding for the rehab of a privately owned track.

“An additional issue complicates any public investment at either Pimlico or Laurel Park under the current ownership structure,” the report stated. “Under Section 118 of the Federal Tax Code, expenditures made by a government unit to construct improvements at a facility owned by a for-profit entity will constitute taxable income to that entity. Tax advisors have concluded that MSA expenditures at either racetrack may be treated as taxable income to any private owner.”

Belinda Stronach, the chairwoman, chief executive and president of The Stronach Group, stated in a press release that “The Stronach Group and [its subsidiary] the Maryland Jockey Club remain deeply committed to reinvigorating Thoroughbred racing in Maryland, and this framework agreement represents an important first step in that process.”

MTHA president Tim Keefe echoed those sentiments in a separate press release that stated “The Maryland racing industry is one of the most storied in the nation and [Friday's] announcement is an important step forward for a sustainable and bright future.”

TDN had follow-up questions for Keefe about the horsemen's perspective on the project, but a voicemail message left for him did not yield a return call prior to deadline for this story.

However, the MTHA press release did state that a “town hall” webinar for members to discuss and ask questions about the project would be scheduled for the near future.

So what might the reimagined Pimlico look like? The MTROA report outlined the following basic concepts for what would be one of the nation's few remaining tracks nestled within an urban neighborhood.

A new Pimlico would be a “best-in-class facility” featuring both a “right-sized” grandstand and clubhouse “with overlays that could be activated for the Preakness and other large events,” the report stated.

The report also envisioned the creation of a 1,000-seat event space, development parcels, a hotel built by a private partner, and “state-of-the-art equine diagnostic health facility with space for veterinary services.”

Housing for backstretch workers would not be in the stable area, but instead “constructed in the Park Heights community” near Pimlico.

Two parking facilities would be constructed. One would be part of the hotel. A second garage could be shared by both racetrack patrons and patients and staff at Sinai Hospital, which is adjacent to Pimlico.

As for the new training facility, the report stated that MTROA identified eight potential locations within a 50-mile radius of Pimlico to be examined for suitability.

Ranked on a scoring mechanism that evaluated nine criteria, the top three were Shamrock Farm in Woodbine, Mitchell Farm in Aberdeen, and the former Bowie Race Track in Bowie that last hosted racing in 1985 but had functioned as a training facility until 2015.

The report stated that “it is the recommendation and conclusion of the [MTROA] that those three locations move to a next stage for final consideration and subsequent acquisition. The [MTROA], however, will continue to evaluate and consider additional suitable properties if and when they become known.”

A footnote within the report disclosed that during the investigation of possible sites, “the [MTROA] learned through industry sources that Shamrock Farm, which is currently owned by the family of [MTROA] Authority member [and National Thoroughbred Racing Association president and chief executive] Tom Rooney, may be for sale. Those members leading the search reached out to Mr. Rooney about its availability, and he confirmed that a sale may be possible.”

With regard to the fundamental change of the state's operating model for racing, the report stated that it is seeking a system that “mirrors that in use by the New York Racing Association. Facilities would be owned by the State and leased to a professional not-for-profit operator. This structure will better align operations with the needs of the horse racing industry and the State's significant financial investments.”

The MTROA, the report stated, would be in charge of coming up with a recommended operator.

The MTROA has been meeting regularly since first convening in August 2023, while also conducting research and receiving testimony from a wide variety of stakeholders. It was created to meet twin objectives mandated by legislation: Reimagining the state's horse racing infrastructure to better align with budget realities, and conducting a review of Maryland horse racing operations in order to recommend the best path forward.

The MTROA is composed of appointees of the governor and legislative leaders and representatives of horse industry organizations, plus the MSA, the Maryland Economic Development Corporation, and others who have a stake in the areas surrounding Pimlico, Laurel, and Bowie.

The report that came out Friday was required by the General Assembly to be issued by that date.

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