What is going to happen to Maryland racing now?

For months it has appeared that a major change in the state's thoroughbred industry was imminent. (And what change would not be for the better?) In the spring the state legislature was trying to pass a "consolidation" bill that would have shut down Bowie and conducted all the state's racing at Laurel and Pimlico. This fall, rumors have persisted that Laurel President John D. Schapiro was going to sell his track. Most recently a buyer was attempting to purchase both Bowie and Laurel, with the idea of turning Laurel into a major sports complex.

But when Schapiro announced this week that all his talks had come to naught, that the proposals he heard were "absolutely capricious," Maryland racing was back to the status quo, with Laurel unprofitable, Timonium anachronistic and Bowie conducting the bulk of the state's racing at one of the most depressing physical plants in America.

Some of the men who reportedly wanted to get into the racing business here had the resources to revitalize the sport: John Mooney had done an extremely professional job in one year as general manager at Laurel, until Schapiro objected to his spending too much money. Frank DeFrancis has wrought a miraculous transformation at once-decrepit Freestate Raceway. Jack Kent Cooke, who apparently wanted to build the sports complex at Laurel, is one of the country's preeminent sports entrepreneurs.

The interest of such men suggests that the racing business in Maryland must have an enormous amount of untapped potential. But they had to conclude that the cost of an investment would be too high and the probable rewards too low.

Although Schapiro spends a lot of time bemoaning the financial losses that Laurel supposedly has been suffering, he doesn't seem eager to sell. His price tag on the track -- $12 million or thereabouts -- was higher than potential buyers thought was justifiable. The Canadian company that controls Bowie has reportedly been willing for years to sell the track, but it, too, is asking for a steep $12 million. Would-be buyers presumably feel that Bowie isn't profitable enough to justify this price.

The reason that owning a racetrack isn't necessarily a lucrative venture is, of course, the unique way the business is taxed. Maryland takes slightly more than 4 cents out of every dollar that passes through the betting windows of its racetracks, and acts as if collecting that revenue is its God-given right. Even if a particular track is losing money, or if the whole industry is suffering, the state has shown no inclination to give back some of that revenue.

Any smart entrepreneur would have to have doubts about investing $12 million or $24 million to get involved in such an unequal partnership with the state. Perhaps that is why Maryland is left with owners who operate their track as an ego trip or who make a profit by treating their customers as shabbily as possible.

It should not be difficult to transform Maryland into a first-rate racing state. Some form of "consolidation" is vital; it makes no economic sense for Laurel's attractive physical plant to stand empty for 300 days a year. DeFrancis apparently had visions of conducting harness racing at Laurel when thoroughbreds weren't running there, although the most logical form of consolidation would be to shut down Bowie and run its dates at Laurel.

Earlier this year the racing industry was pushing a consolidation bill that would have forced the state's horseplayers to pay the cost of buying out Bowie through a higher parimutuel "take." But taking more money from one's customers hardly seems the way to improve the industry's financial health, and this scheme fortunately died in Annapolis.

There is a better way. State governments commonly offer tax incentives to lure businesses that will stimulate their economy. Why shouldn't they do that with the racetrack business? If a Cooke or a Mooney or a DeFrancis wants to spend $24 million to revive one of the state's major industries, the state ought to turn over to them a portion of its share of the parimutuel betting to help make the investment a viable one.

This isn't an outlandish notion. The state of New Jersey has taxed its racing industry judiciously in recent years, with a concern for its long-term health. Historically, New Jersey's racing has been on a par with Maryland's. But New Jersey conducts the sport at Monmouth Park, one of the most beautiful racetracks in America; and at the Meadowlands, which is the most successful new track built in this country in many years. Maryland still has Laurel, Pimlico, Timonium and (ugh) Bowie. Even a myopic state legislator ought to be able to see the difference.