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In another blow to track’s future, Pimlico pulling the plug on off-track betting operation

The betting windows were largely shuttered on May 11, the opening day of the spring live-racing season at Pimlico Race Course in Baltimore. Photo by William F. Zorzi.

Citing “financial challenges … faced in recent times,” the owners of Pimlico Race Course notified employees Saturday that they are shutting down the track’s off-track betting (OTB) facility by June 30 — the same date a key agreement for racing operations in Maryland is due to expire.

In an e-mail to employees of the Maryland Jockey Club — subsidiary owner of the Pimlico and Laurel Park tracks — Mike Rogers, the company’s’ acting president, wrote that “this decision was not made lightly.”

“The Pimlico OTB has been a valuable part of our organization for many years, providing a convenient location for our customers to enjoy thoroughbred racing,” Rogers wrote. “Understandably, this news may come as a disappointment to many of you.”

He told the workers that the company’s focus would now turn to the track staff.

“In the coming weeks, we will be working closely with affected employees to provide resources and assistance as we wind down operations at Pimlico,” he wrote.

Efforts to reach Rogers on Tuesday were unsuccessful.

The Maryland Jockey Club, owned by the Canada-based Stronach Group, which also does business as 1/ST, apparently did not notify the Maryland Racing Commission of its proposal to shutter the OTB operation, though the prospect of such a change had been discussed earlier. The matter is certain to be on the agenda at the next meeting of the Racing Commission — the state’s permitting agency for the horse racing industry — scheduled for June 6 at Laurel Park.

It was not immediately clear how many employees would be affected by the closure, but the looming suspension of off-track betting at Pimlico is another sign of the Maryland racing industry’s hard times.

The Maryland Racing Commission is apparently no longer able to answer press inquiries directly and referred a reporter to the communications office of the state Department of Labor, which oversees the regulatory agency. A spokesperson for the department asked Tuesday that any questions be put into an email, but that email had not been answered as of Tuesday night.

More than $11.3 million was wagered through simulcast betting at Pimlico in the 2021 calendar year, according to the Racing Commission’s annual report that year, its most recent. Pimlico was open for wagering on 199 simulcast days in 2021, in addition to 59 live racing days, the annual report shows.

Money that is now wagered at Pimlico’s simulcast facility will likely shift to the two other Baltimore-area facilities, Timonium Race Course, which handles the majority of OTB wagering in the state, and Horseshoe Baltimore, the casino on Russell Street in the city.

The end of OTB at Pimlico is scheduled to occur on the same date as the expiration of an agreement between the Maryland Jockey Club, Maryland Thoroughbred Horsemen’s Association and the Maryland Horse Breeders Association for continued operation of Pimlico and Laurel Park. The date extending their 10-year agreement already has been extended from Dec. 31, 2022, to midnight June 30.

The racing calendars for Pimlico and Laurel are complete only through June 30. Pimlico’s spring meet of live racing is scheduled to end on Sunday, June 4, with simulcasting slated through the June 30. Live racing at Laurel picks up again on Fridays, Saturdays and Sundays beginning Friday, June 9, through Friday, June 30. Simulcasting is scheduled for the other days of the month, except for June 6, the date of the Racing Commission meeting at Laurel Park.

The focus of recent negotiations has been a Maryland Jockey Club proposal for the horsemen and breeders to give up a greater percentage of their share of purses — racing’s prize money — to offset the cost of track operations, people with knowledge of the discussions have said.

Purse money comes from a variety of sources, including a state subsidy from gaming proceeds. Generally, 6% of the state’s revenue from video lottery terminals, not to exceed $100 million, goes to subsidize purses through the Purse Dedication Account, under the authority of the Racing Commission.

For the fiscal year that begins July 1, the state has budgeted $81.8 million for the total subsidy to both the thoroughbred and standardbred tracks, which receive 80% and 20% of the money, respectively, in the purse account.

The General Assembly this year created the Maryland Thoroughbred Operating Authority, a panel with sweeping powers that would keep racing operating, should the negotiations between the Maryland Jockey Club, the horsemen and breeders reach an impasse. Appointments to the new board, which comes into existence on Thursday, are expected soon.

State officials have been trying to jumpstart stalled improvements at Pimlico and Laurel that were approved by the General Assembly more than three years ago.

In its 2020 session, the legislature authorized the sale of $375 million in bonds for capital improvements at the two mile-long tracks, but the bond sale, contingent on the approval of certain still-unsigned agreements, has yet to take place. Since then, cost estimates for track improvements have nearly doubled, as any sort of progress has all but stopped.

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In another blow to track’s future, Pimlico pulling the plug on off-track betting operation