Bidding Process Flawed, Applicant Tells Officials

Lawyers for the Maryland Jockey Club have told Maryland officials that the state's bidding process for slot-machine licenses is legally flawed and that the club's proposal for the Laurel Park racetrack should be considered despite its failure to pay a required $28.5 million fee.

A lengthy legal memorandum outlining the organization's arguments was submitted to the state late Tuesday and made public yesterday, on the eve of a meeting of a state commission that will weigh whether to disqualify the application.

The memorandum argues that the law establishing Maryland's slots bidding process does not make clear whether license fees are refundable for unsuccessful bidders. As a result, requiring bidders to submit fees up front is "unlawful" and cannot be enforced, the memo argues.

"The requirement of a nonrefundable or potentially nonrefundable Initial License Fee as one of the minimum requirements for consideration of an applicant's proposal is constitutionally, facially invalid, constitutes an unlawful taking or confiscation of private property and violates public policy," says the memo, prepared by lawyers at Rifkin, Livingston, Levitan and Silver.

The firm is representing the Laurel Racing Association and the Maryland Jockey Club. Both entities are affiliated with Magna Entertainment, a Canadian company that owns Laurel Park in Anne Arundel County as well as Pimlico Race Course in Baltimore.

Laurel is seeking one of five available slots licenses. A competing proposal for a site in Anne Arundel by the Cordish Cos. contemplates putting a slots parlor at Arundel Mills mall. Cordish submitted a license fee before the bid deadline this month.

"We think the bid procedures were pretty straightforward," Joseph S. Weinberg, president of development for Cordish, said yesterday.