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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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Alan Foreman Joins TDN Writers’ Room Podcast

These are busy times for Alan Foreman, who is the general counsel to the Maryland Thoroughbred Horsemen's Association, a member of Maryland's Thoroughbred Racetrack Operating Authority (MTROA) and serves as an ombudsman for the Horseracing Integrity and Safety Authority (HISA) and the Horseracing Integrity & Welfare Unit (HIWU). He took time out of his schedule to join the TDN Writers' Room Podcast, sponsored by The Green Group.

It is his work with the MTROA that has received the most attention of late as the Authority recently issued a plan that would completely overhaul Maryland racing. Pimlico will be rebuilt and when that is done, racing will cease at Laurel. The Stronach Group will turn the tracks over to the state, which will become the new operator, but will maintain the rights to the GI Preakness S. and the GII Black-Eyed Susan S. A new training center will be built.

This is the evolution of a 2020 plan which called for the rebuilding of both Laurel and Pimlico. A total of $375 million was put together for that project, which eventually stalled because of a number of factors. Those same funds will be used to for a new Pimlico.

“Pimlico became the hub property for this project, and working with the Maryland Stadium Authority and other experts that we worked with over the past six months, we have a plan to go forward and it is within range of the cost of the bonds that were initially authorized by the Maryland General Assembly,” Foreman said. “So that's the genesis of this project going forward. It's a mountain of work that's been done in the last six months. But now the rubber hits the road.”

It is still not clear what the agreement means, which allows The Stronach Group to retain the rights to the Preakness and Black-Eyed Susan. Major questions remain, like, how will the revenue from those two days of racing be divided up?

“There's a framework for an agreement that is now being negotiated between the state and Stronach,” Foreman said. “It's estimated that agreement will be finalized within the next 30 to 60 days. It's critical that the agreement be finalized because we have started the legislative session. Legislative leadership and the governor are going to be very interested in the outcome of those negotiations. But I think both sides are confident that they will come to a final written agreement because the ink is not dry on this deal and there are still matters to be negotiated. But the framework is that because Stronach owned the rights to the Preakness, they will license the event to the state of Maryland and the state of Maryland will, as a not-for-profit, run the Preakness. The division of revenues is being negotiated. It will be a fair agreement to both sides.”

As far as his work with HISA/HIWU goes, Foreman admits that there have been problems, particularly when it comes to trainers receiving hefty fines and suspensions for infractions that may be the result of environmental contamination. He says work is being done to make a fair system.

“I've never seen an intentional administration of a cocaine or a methamphetamine to a horse, and there wouldn't be a reason to do it,” he said. “The industry pre-HISA did a very good job of handling these cases. This was something that was not broken and needed to be fixed. And somehow in the new system it got broken. Fortunately, it's being fixed under new rule changes that we're waiting for the Federal Trade Commission to approve that will give HIWU the discretion to determine that it is more likely than not that the positive was a case of contamination or inadvertent exposure, as we like to call it, and not an intentional administration. The penalties have been substantially reduced per this rule change that's coming.”

This week's look at a Coolmore sire focused on champion 2-year-old Corniche (Quality Road). He was undefeated as a juvenile with wins the GI American Pharoah S. and the GI Breeders' Cup Juvenile. He was purchased for $1.5 million at the 2021 Ocala April Sale by a team that included TDN Writers' Room regular Zoe Cadman, who recalled how she was blown away the first time she saw the horse. Standing for $25,000, Corniche's first foals are arriving this week.

Elsewhere on the podcast, which is also sponsored by WinStar Farm, the Pennsylvania Horse Breeders Association,1/ST Racing, West Point Thoroughbreds and XBTV.com, the team of Randy Moss, Cadman and Bill Finley looked back at the impressive maiden win at Gulfstream by 'TDN Rising Star' Conquest Warrior (City of Light) who overcame a ton of trouble to post the victory. A $1 million Keeneland September purchase, he's one to keep an eye on as the road to the GI Kentucky Derby progresses.

The team was united in its praise of Churchill Downs for raising the purse of the Derby from $3 million to $5 million, while also calling on the two other Triple Crown tracks to match Churchill's move. Cadman also brought up the point that the GI Kentucky Oaks goes for $1.25 million and is deserving of a substantial purse hike.

To watch the Writers' Room podcast video, click here. To listen to an audio version, click here.

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Report: Long-Awaited Pimlico Redevelopment Delayed At Least Two Years

During a budget briefing on Thursday, Feb. 3, the Maryland Stadium Authority's executive vice president Gary McGuigan revealed that the redevelopment of Pimlico Race Course has been delayed by at least two years, reports the Baltimore Business Journal.

“I don't have a detailed timeline,” McGuigan said. “I will say the earliest that I see activity at either facility is most likely after the Preakness in 2023.”

Maryland Governor Larry Hogan allowed the Racing and Community Development Act of 2020 to become law without his signature on May 7, 2020. The legislation called for the Maryland Stadium Authority to issue up to $375 million in bonds for the projects through a combination of funds from the Racetrack Facility Renewal Account, the Purse Dedication Account, video lottery terminal payments to Baltimore City and money from the Maryland Lottery.

The plan includes a new stable area, training facility and synthetic racing surface at Laurel and the ability to use the new Pimlico as a year-round event and community center. A major part of the legislation is keeping the Preakness Stakes at Pimlico and giving the racetrack property to the city.

However, no bonds have yet been sold and neither project has broken ground. Bonds are unlikely to be sold prior to the spring of 2023, according to the Baltimore Business Journal. Ayers Saint Gross has been selected as the designer, but no construction contracts have been awarded.

The Maryland Stadium Authority's delay in bond sales could cost taxpayers at least $34 million, a legislative analyst report explained.

Read more at the Baltimore Business Journal.

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