By John Scheinman
Special to The Washington Post
Saturday, November 1, 2008;
B01
At the end of last month's meeting of the Maryland Racing Commission, member Jacqui Nigh pleaded with all in attendance to spread the word throughout the thoroughbred and harness racing community to keep pushing for the proposal that would legalize slot machines in the state -- to slap bumper stickers on their cars, wear lapel pins and stand outside polling stations on Election Day.
"I know you have done so much already," Nigh said. "We need to do more."
These are worrying times for the state's thoroughbred and standardbred racing and breeding industries. "Do you think it will pass?" has become as common a phrase as "Who do you like?" among those who make their living at the racetracks and breeding farms.
While most of the debate on the measure on Tuesday's ballot has focused on the state's projected budget shortfall and funding public education, horsemen see it as a make-or-break decision for their livelihoods. The proposal, which would authorize as many as 15,000 slot machines at five locations, earmarks some of the slots revenue to help their industry.
"If the slots bill does not pass, I will sell my house here, and I'm going to move," said trainer and breeder Mary Eppler, 54, of Westminster. "If it doesn't pass, there's no future for the horsemen here."
Scott Arceneaux, senior adviser to Marylanders United to Stop Slots, said he sympathizes with the plight of the racing industry, "but that doesn't mean it's good public policy to subsidize one form of gambling with another."
Supporters believe slots would produce an estimated $60 million a year by 2013, to be pumped into purses at the tracks and into breeding fund accounts. An additional 2.5 percent of slots revenue would be earmarked for racetrack renovations for eight years, provided owners produce matching funds.
Maryland racing and breeding interests see this as their last chance to gain equal footing with rivals in neighboring Delaware, Pennsylvania and West Virginia, all of which resuscitated struggling racing programs through the legalization of slots.
Magna Entertainment, which owns Laurel Park and Pimlico Race Course, authorized the Maryland Jockey Club to donate $2 million to For Maryland For Our Future, a pro-slots ballot committee. The Maryland Thoroughbred Horsemen's Association gave $300,000; the Maryland Horse Breeders Association gave $25,000. Developer William Rickman Jr., who owns Delaware Park as well as Ocean Downs on the Eastern Shore, has given $425,000 through various entities.
"For the horse industry, everything is on the line," said Cricket Goodall, executive director of the Maryland Horse Breeders Association. "If I didn't see substantial support, I would be shocked."
For years, racing and breeding interests in Maryland have told legislators in Annapolis that their business was in peril because of the advent of slot machines in neighboring states. Each of those states poured slots money into their sleepy racing industries.
The impact was profoundly felt in Maryland, long the leading racing state in the Mid-Atlantic. As prize money for races rose at neighboring tracks, purses at Laurel Park and Pimlico Race Course remained stagnant or declined.
New, rich rewards for breeders in Pennsylvania drove a migration of farm interests north. In 2001, there were 110 stallions in active stud duty in Maryland, according to Jockey Club figures. Last year, there were 54.
Laurel Park suspended its entire open stakes racing program this fall to save money. Gone were some of the most important races in the state, including the Laurel Futurity, won by horses such as Citation, Secretariat and Barbaro.
In August, Magna also closed the Pimlico backstretch for stabling, forcing Eppler and others to move their horses to Laurel Park and the Bowie Training Center, where, because of crowding, they were unable to obtain the same number of stalls they previously had.
At the recent racing commission meeting, Ted Snell, chief executive of Cloverleaf Enterprises, which operates Rosecroft Raceway in Fort Washington, said his track is almost dead.
Live racing has been suspended for the remainder of the year, except for a few stakes races that will be run in November without wagering, and nothing is scheduled for 2009. The stalls at the track are practically empty.
The racing interests look at the referendum as an opportunity to compete on even terms.
"Racing is still viable," said Tom Chuckas, president of the Maryland Jockey Club. "Prior to the competitive advantages Delaware, West Virginia and Pennsylvania got with the introduction of gaming, we were very competitive. Our racing stood up against almost anybody across the country."
Arceneaux said there are other ways to help racing in the state. He pointed to the interest of Halsey Minor, founder of the CNET Networks media company, in buying Magna Entertainment.
Minor, a native of Charlottesville, has been shopping to buy a racetrack. He appeared at a recent news conference with state Comptroller Peter Franchot (D), a strong opponent of slots, and said he would invest millions of dollars in Maryland racing without alternative gaming.
Magna has not responded to Minor's inquiries about buying the company.
Jeffrey Hooke, a Bethesda investment consultant and chairman of the Maryland Tax Education Foundation, said the racing and breeding industries are poor investments for the state.
"If you look at racecourses that have doubled or tripled purses, you'll see activity didn't increase much in breeding, attendance and betting," Hooke said. "The best you can hope for is that the $100 million will stop the secular decline in the industry. If you're going to spend $100 million in an industry, you should spend it more on an industry that is going to grow, like biotech."
Asked about the value of the Preakness Stakes, the second leg of racing's Triple Crown, which generated more than $73 million in wagers this past May and an ancillary economic impact of $24 million for the state, Hooke said: "For two or three days, that's a huge party in Baltimore and Maryland in general . . . but is that worth $100 million a year? I don't think so."
Don Litz, 62, a stallion farm owner who lives in Butler, said he thinks slots will do more than just subsidize racing and breeding, if the sport is marketed right.
"You only have to look at these one-day events like Preakness or Maryland Million or what happened with Barbaro and Seabiscuit -- there is this huge untapped interest," Litz said. "Slot machines are not the answer to bringing people into our sport; it just gives us a funding mechanism."
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