The Stronach Group, Baltimore Talking Future of Pimlico

It might not yet be time for fans of Pimlico Race Course to celebrate. But for the first time in a long time, there's a possibility that the light at the end of Old Hilltop's tunnel is not that of an oncoming train.

The June 27 edition of the monthly Maryland Racing Commission meeting, which in prior days seemed as though it might be contentious, turned unexpectedly friendly as commissioners learned of what multiple people called "good-faith negotiations" on the future of Pimlico and the Preakness Stakes (G1) between Baltimore and The Stronach Group, parent company of the Maryland Jockey Club, which owns Pimlico, Laurel Park, and the former Bowie training center.

"They really do believe they can get something done—that's music to my ears," said commission chairman Michael Algeo after the meeting. "I don't want to get too optimistic—don't want to jump the gun on that. But that's a big step forward from lawsuits and volleys back and forth."

"I can't tell you how happy I am to hear people speak of the possibility of Pimlico remaining the home of the Preakness for years to come," agreed April I. Smith of the Friends of Pimlico group.

The negotiations include attorney Alan Rifkin, representing The Stronach Group; former Baltimore Development Council head Bill Cole, speaking for the city; and horsemen's group representative Alan Foreman. The three appeared together before the commission Thursday afternoon.

"We've been asked to explore the ways and means to preserve and enhance the Preakness in Baltimore City to foster the sustainability of racing in the state and to determine what facilities are necessary to accomplish those goals," Rifkin told the Commission.

"There is nothing more significant to us … than finding a solution," he added. "It will be resolved if it can be resolved."

Pimlico—an aging facility with a rich history but an infrastructure The Stronach Group chief operating officer Tim Ritvo described as "ancient"—has been the focal point of what turned into a pitched battle between The Stronach Group and Baltimore. The company has argued the business environment in the racing industry, which has seen wagering handle drop by nearly 50% nationally in the last 15 years, compels them to centralize operations at a single facility and that Laurel is the logical site for its proposed "super track."

The city has countered by saying that moving the Preakness—the city's "annual Super Bowl," as some have called it—would be a death knell for the neighborhood surrounding Pimlico and that the company has been engaged in what amounts to "demolition by neglect," allowing the facility to crumble in hopes that the commission would permit it to move the state's biggest annual sporting event to Laurel.

Legislative proposals advanced by the sides during the recently completed session of the state General Assembly both failed to move from committee.

In June, Baltimore Mayor Bernard "Jack" Young agreed that the city would withdraw a lawsuit it had filed seeking to take possession, via condemnation, of Pimlico and the Preakness. That decision, Young said in a statement, was "to give the parties an opportunity to discuss Pimlico and racing in Maryland."

"My goal is to protect the racing industry," Foreman said of his role in negotiations. "I firmly believe we can make Maryland racing not only the epicenter of racing in the mid-Atlantic but in the whole country."

There's a long way to go to get there. Among the key issues in what Rifkin called "a difficult problem" are what a new Pimlico might look like, how much it would cost—a pair of Maryland Stadium Authority reports came up with two different proposals, ranging from around $200 million to more than $400 million—who would pay, and how all that could be accomplished without undermining what the Maryland industry has achieved in recent years.

Ritvo, who characterized the discussions as "good-faith negotiations," observed, "We're just trying to figure out a pathway that works. We need to present a win for the city of Baltimore, the state, and the horsemen that race with us all the time; that's what we're trying to accomplish."

His company has been firm that it does not see a financial pathway that includes the company funding extensive renovations at both Laurel and Pimlico. And there's the question of—if Pimlico survives at all—how much racing it should host. Though in recent years it has hosted just a dozen days of live racing, 37 days of live racing were held at Old Hilltop as recently as 2015.

Delegate Nick Mosby, a Baltimore Democrat, told the commission that this lack of inclusiveness with regard to Pimlico and its racing days is a critical point.

Beyond the longer-term issue of Pimlico's future, there's also the question of the here and now. The facility's disrepair became an issue during this year's Preakness when a water main break occurred just days prior to the big race.

Ritvo said that what had happened was "totally unacceptable" and told the commission that the company has earmarked $750,000 to ensure the problem does not recur.

The company has come under fire for directing the lion's share of its capital expenditures, including those matched by state-provided Racetrack Facility Renewal Account funds, to Laurel. The commission, likewise, has come under fire for approving those expenditures. But Algeo rejected those criticisms, saying that since the Legislature had not specified any preferred split of funds, it would not be in the commission's authority to direct otherwise.

"As far as I know, we have complied with every regulation, we have complied with every statute," he said. "We have acted in good faith, and we will continue to act in good faith. We have done everything we can possibly do to do the job we're supposed to do."

Originally, the commission was slated to consider a request for an RFRA reimbursement at Thursday's meeting, but that request was withdrawn when, according to Algeo, commission counsel Eric London realized that the company had not received approval for a current capital improvement plan.

Algeo pressed the company to provide a plan that goes beyond the end of 2019, at least with regard to Pimlico, which he suggested would almost certainly be the location for the Preakness in 2020 and 2021.

"I understand we don't know what's happening with Pimlico long range, although after today I'm praying that something good happens," he said. "But … I want something on paper that you're going to show us. I realize it's an old facility, it's gonna come with issues and problems, but I want to be able to say publicly to people that the Maryland Jockey Club is doing X, Y, and Z to ensure that that is a Triple Crown venue."

News and analysis from Frank Vespe at The Racing Biz.