At most of the tracks whose purses have been bolstered by slot money, the sport has not become more popular or self-sustaining. Thoroughbred tracks such as Parx (the former Philadelphia Park), Delaware Park and Presque Isle Downs, as well as just about all of the harness tracks with subsidies, have few fans in the grandstand and unimpressive betting totals. Even committed racing fans pay little attention to them.
Most economists deplore what they call cross-subsidization, taking money from successful enterprises to prop up losers, and it’s hard to make a good case why states should force casinos to subsidize racetracks that can’t survive on their own merits.
Nevertheless, the Maryland horse industry is a special case; it deserves this help. The state’s tracks were profitable, and its breeding industry was an exemplary success until Maryland was crushed by competition from tracks with slot money. The subsidy for purses at Laurel and Pimlico levels the playing field. And the nature of the Dec. 14 deal makes Maryland different, too. At operations such as Parx, Delaware Park and Charles Town, which make huge profits from casino gambling, horse racing is largely irrelevant. But the Maryland Jockey Club won’t be in the slot business, and it has ample incentive to promote racing and to try to increase the sport’s business.
This will be no easy task. In the past, improving the decrepit facilities at Laurel and Pimlico might have lured more fans. But in an era when bettors can watch races on television at home and bet by phone, Laurel and Pimlico aren’t going attract big live crowds except on special days. But if the Maryland Jockey Club wants to attract the attention of horseplayers, there is one thing that it could and should do: reduce the takeout.
Over the years, the Maryland tracks have sought to increase purses by extracting more money from every betting dollar. They used to take 15 percent from each win bet; now the rate is 18 percent. The takeout from trifectas is an exorbitant 25.75 percent. (By contrast, Kentucky takes 19 percent from its trifectas.)
Now that the industry is about to be awash in money from Maryland Live and other casinos, there is no justification for squeezing every possible dollar from its customers. A substantial takeout reduction would appeal to simulcast bettors across the country and boost wagering on Maryland races. And it would contain an element of fairness. When a relatively small number of breeders, trainers and owners are going to enjoy a windfall from the new economics of Maryland racing, the industry should give a small break to the betting public that has continued to support the game.