New Jersey racing Hollywood Casino Perryville generates industry faces crisis total of $11.3 million in revenue The Horsemen’s of its own during first full month of operation is not the only Mid-Atlantic Maryland’s first slots facility to be- Newsletter racing jurisdiction struggling to come up gin operation, Hollywood Casino with a workable plan for the industry’s Perryville, generated $11,394,697.61 E

future. L L

I in revenue during October, accord- V

New Jersey, which like Maryland has Y

R ing to figures provided by the Mary- R no prospect for its tracks E P land Lottery. T

to operate as racinos, took a bold new A November 2010 O Of that amount, approximately Volume 20 • Number 11 N I

approach at Monmouth Park last sum- S

A $567,909 goes toward Thorough-

mer—slashing race days and raising C D bred purses. O

purses to the highest level of any track O

W By state law, slots revenue is di- Y

in the country. L L vided according to the following Casino at O Industry mired in uncertainty Although attendance and mutuel han- H formula: 7 percent toward purses dle rose dramatically, the track’s bottom and breeders’ funds, to be divided on an 80-20 percentage basis between the Thor- Ocean Downs following AA County referendum line remained in the red. Monmouth’s oughbred and harness industries. Each portion is then shared by the purse account operating losses are reported to be and breeders’ fund on an 89-11 percentage basis. about $6 million. he future of Maryland’s racing in- that plan, or something like it, was not The total amount generated for purses and breeders’ funds in October was set to open by Monmouth and the Meadowlands are dustry, even in the near term, clear at the time this newsletter went to $797,628.83. owned and operated by a quasi-govern- looms as a giant question mark fol- press. Hollywood Casino Perryville, owned and operated by Penn National Gaming Inc., T mental agency, the New Jersey Sports lowing the November 2 referendum in opened on September 27. Located just off of I-95 in Cecil County, it has 1,500 ma- year’s end However, the MJC was scheduled to and Exposition Authority, which wants Anne Arundel County that allows the chines. The daily average gross per machine in October was $245, well above the make its 2011 racing dates request at to get out of the racing business. proposed casino at Arundel Mills Mall to $210 projected by a Department of Legislative Services study conducted prior to the the November 29 meeting of the Mary- Long-term competition with Atlantic aryland’s next slots facility, Casino proceed. (See MTHA President Richard statewide referendum in November 2008 that authorized Maryland’s slots program. land Racing Commission. City casinos, and proliferation of racinos Mat Ocean Downs, is expected to Hoffberger’s Thoughts and comment More information can be found at www.mdlottery.com/slots. The ’s co-own- in surrounding states, can be blamed for open by the end of this year. on page 4..) ers, MI Developments Inc. and Penn Na- the decline of New Jersey’s once-thriv- An exact date has not been an- It was a landslide victory for Balti- tional Gaming Inc., disagree over ing Thoroughbred industry. nounced, but construction is nearing more-based Cordish Company, with ap- Hoofprints completion on a three-story building on whether or not to conduct live racing at proximately 56 percent of the voters Laurel in 2011, and are at an impasse. Committee the site of the former grandstand at the casting their ballots in favor of zoning Grove inducted into Interactive Registration (IR) is the MID President and CEO Frank harness track located in Berlin (Worces- approval for the mall site. bulletins Charles Town Hall of Fame most efficient way to complete the ap- Stronach is willing to maintain a live rac- plication. The Jockey Club also recom- ter County), just outside of Ocean City, Maryland Jockey Club (MJC) Presi- Maryland steward Phil Grove has ing program for one more year, with a Bowie mends using IR to upload digital foal Ocean Downs will launch its slots dent and CEO Tom Chuckas had issued been inducted into Charles Town’s Hall schedule similar to 2010. However, Mr. identification photos, as the online ser- business with 750 machines, although it a dire warning at the October 19 meet- Backstretch co-chairman Linda of Fame, in recognition of his riding Stronach does not have the final say. vice accepts all standard file formats and is licensed for 800; the remaining 50 ma- ing of the Maryland Racing Commission. Gaudet reported: achievements at that West Virginia MID controls 51 percent of the MJC’s • The track kitchen television is still file sizes up to 10 MB. chines will be added at some future If voters gave the go-ahead for the track. Mr. Grove rode the 3,500th win- IR is available at no charge at time, based on customer response. Arundel Mills Mall site, just 10 miles racing enterprise and three of the five without a racing channel. ner of his career at Charles Town in seats on the decision-making commit- • The race track is in good condition. www.registry.jockeyclub.com. Games will include traditional slots as from Laurel Park, the MJC planned for 1992, and had a total of 3,991 winners tee, but major changes can’t take place • There are potholes throughout the well as electronic roulette and electron- Laurel to cease operating live racing and before retiring from the saddle in 1997. Deadline for naming foals of ’09 without the approval of both parties. stable area. ic blackjack. become a year-round off-track betting Turf course closed The Jockey Club reminds owners and Governor Martin O’Malley met with • The horse path needs repairs. Maryland’s slots program, authorized site, said Mr. Chuckas. Maryland’s only breeders that a valid attempt to name Penn National Vice President Steve Sny- Laurel Laurel Park’s turf racing season end- in the 2008 statewide referendum, al- mile-track racing would consist of a 40- der and Mr. Stronach on November 17. ed on November 17. The turf course foals of 2009 must be made by February lows a total of five sites, within specified day meet at Pimlico, centered around Backstretch chairman Larry Murray 1, 2011, to avoid a $75 late fee. For the Preakness. Bowie Training Center said: will not be used for the remainder of the boundaries in Allegany, Anne Arundel, While it did not resolve their differ- more information, go to www.registry. would shut down, and stabling would ences, the discussion was “very for- • Please take care not to drive vehi- year. A total of 99 races were run on the Cecil and Worcester Counties, and Balti- grass at Laurel this fall. jockeyclub.com or call (859) 224-2700. more City. The Allegany County site has no longer be offered, with the brief ex- ward-looking,” Gov. O’Malley’s spokes- cles on the horse path, or allow water ception of Pimlico in the spring. man Shaun Adamec told the Daily on it, now that the weather has turned Horses need halters Spanish-language version so far failed to attract a qualified bidder. of hoof care DVD The bidding process in Baltimore City Whether the MJC will proceed with Record. cold. Frozen tire tracks and ice patches Trainers are reminded to keep halters has stalled, and following a lengthy zon- are a serious hazard. on horses at night. This is an important The Welfare and Safety of the Race- ing battle the Anne Arundel County li- • New windows are being installed in safety precaution. horse Summit’s Shoeing and Hoof Care MTHA Christmas Party canceled the track kitchen. cense (originally designed for Laurel End-of-year deadline for foal Committee has released a Spanish-lan- Park) has gone to a casino at Arundel Due to the current crisis facing Maryland racing, the MTHA’s annual Christmas registration applications guage version of its educational DVD Mills Mall (see article at right). Party was canceled this year. Smoking strictly Yearlings and 2-year-olds must have “The Hoof: Inside and Out,” entitled, “El Ocean Downs and Laurel Park were “Our future is, at best, uncertain,” commented MTHA President Richard Hoff- Casco: Por Dentro y Por Fuera.” berger. “For this organization to host a party under these circumstances would bor- prohibited their registration completed by Decem- the only race tracks eligible to operate as ber 31 to avoid additional late fees. Both the English and Spanish-lan- der on fiscal irresponsibility.” Maryland Jockey Club director of slots facilities. The late registration fee increases guage versions can be downloaded at The event had been scheduled for November 29 at Laurel Park. Mailers announc- racing Georganne Hale reminds horse- For complete details of Maryland’s from $525 to $775 after December 31 of no charge at grayson-jockeyclub.org/ ing the change in plan were sent out to the membership on November 8. men that smoking in the barns is strict- slots program, go to the MTHA’s Web the yearling year and from $775 to summitDisplay.asp?section=39. A copy The MTHA apologies for any inconvenience that may have resulted from the ly prohibited. Violations will result in site, www.mdhorsemen.com, and click $2,000 after December 31 of the 2-year- can also be ordered through that Web cancellation. major fines. on “News.” old year. site for a $5 shipping and handling fee. Stimulus Bill, Thoughts, from page 4 Small Business Stimulus Bill benefits horse owners from page 4 owns the tracks. Our job is to negotiate diately opposed the plan. resident Obama has signed the Small other depreciable property. Once total return and depreciate the balance,” ex- the best possible terms for horsemen. The MTHA has warned all along that PBusiness Jobs and Credit Act of 2010 purchases of horses and other eligible plained American Horse Council Presi- to any property that has a depreciable We have requested that the track a casino at Arundel Mills Mall could into law. The bill is intended to help property reach $2 million, the expense dent Jay Hickey. life of 20 years or less. Also, the property conduct a live racing program in 2011 mean the end of live racing at Laurel small businesses and create new jobs. It allowance goes down one dollar for This provision will benefit any busi- must be new, meaning that the original that is identical to 2010. Maintaining the Park. That possibility is nearer than continues the bigger write-off for horses each dollar spent over $2 million. With- ness involved in the horse industry that use of the horse or other property must status quo for another year would allow some thought. and other property purchased and out the bill, the expensing allowance purchases and places depreciable prop- commence with the taxpayer. For a us time to pursue various alternatives Horsemen should realize that a lot of placed in service by a erty in service in 2010 or horse to be eligible, it cannot have been that could keep the industry viable. the suggestions currently being put for- horse business that was 2011. used for any purpose before it is pur- Shortly after the vote approving zon- ward by some within the industry, originally included in earli- The second incentive re- chased. ing for slots at Arundel Mills, I met with while well-intentioned, are unfortunate- er stimulus bills. institutes the 50 percent “The tax benefits in this bill are great MID CEO Frank Stronach to discuss the ly non-starters. The first incentive allows an owner would have been $250,000 in 2010 and first-year bonus depreciation for horses for any horse business that has or is plan- situation in Maryland. For example, it has been suggested who purchases a horse or other busi- gone down to $25,000 for later years. and most other depreciable property ning on making major purchases,” said As we are all well aware, Mr. that the state take over the tracks ness property used in a horse business “Let’s assume a horse business pur- purchased and placed in service during Mr. Hickey. “The expensing and bonus Stronach is a major owner/breeder in through the process of condemnation. and places it in service in 2010 or 2011 chases $750,000 of depreciable property 2010. Bonus depreciation had expired depreciation provisions can be used to- his own right; racing is his passion. Mr. Governor O’Malley has made it clear to expense up to $500,000 of the cost. in 2010, including $650,000 for horses, at the end of 2009. This benefit applies gether in 2010. For example, let’s as- Stronach evidenced compassion for the that he has no interest in pursuing any This so-called “Section 179” expensing and places it all in service. That business sume an owner pays $1,000,000 for a countless people who will have their such action. Furthermore, our attorneys allowance applies to horses and most can write off $500,000 on its 2010 tax See Stimulus Bill, page 3 colt to be used for racing and $100,000 lives turned upside down if Maryland have concluded that it is not a viable op- for other depreciable property, bringing racing is allowed to die. tion, based on the circumstances. The total purchases to $1,100,000 in 2010. Mr. Stronach made it clear that he state can’t take over a privately owned MTHA If the colt had never been raced or used was not only concerned about those di- business just because it is losing money 6314 Windsor Mill Road for any other purpose before the pur- rectly involved in the racing industry and on the verge of shutting down. Baltimore, Maryland 21207 chase and is placed into service, the but the approximately 10,000 jobs relat- MTHA representatives will continue owner would be able to expense ed to our racing in Maryland. to make our best efforts to protect the November 2010 $500,000, deduct another $300,000 of Based on our conversation, he threw industry and the many jobs it supports. bonus depreciation [50 percent of the his personal support behind the contin- Our next move will be determined after $600,000 remaining balance], and take ued 146 days of live racing in 2011, giv- the track owners resolve their own con- regular depreciation on the $300,000 ing us a year to work together to see flicts and officially announce their plans balance.” what changes could be made to move for 2011 and beyond. “We hope the horse industry will racing forward in Maryland. PNG imme- /Richard J. Hoffberger, MTHA President take full advantage of these two tax ben- efits while they last,” added Mr. Hickey. Recreation report Horsemen’s Counseling From Dan Mangum, MTHA Texas hold ’em tournament at Bowie on Program Recreation Director. For information Monday, December 13, beginning at or to sign up for programs, 11:30 a.m. Domestic problems? Substance call Mr. Mangum at (410) 802-5798. For more information call Mr. abuse? Depression? Mangum. The Horsemen’s Counseling Pro- Basketball gram is here to help. For immediate The MTHA’s winter basketball league Donations and confidential services call Bill Bor- will start on January 9 at Meade High The following generous people re- chardt at (301) 776-0404 or (410) 368- School in Laurel. If you are interested in cently donated clothing, reading materi- 5570 (pager). joining a team, please call Mr. Mangum (at number above) as soon as possible. al and/or other items for distribution on the backstretch: Gene Gilhooly, Sean Lil- MTHA Board of Directors The Horsemen’s Poker lis, Greg March, Herb and Miriam Mit- Thoughts and comment Newsletter The MTHA will sponsor a mock tenthal, Mike Rudd and Diana Sansosti. Richard J. Hoffberger next year as we did this year. PNG has President Published monthly by the he future of live racing has been the Richard J. Meyer Horsemen’s calendar said it only wants to race a short meet at Maryland Thoroughbred TMTHA’s primary concern since the Vice President debacle surrounding the Anne Arundel Pimlico. Horsemen’s Fasig-Tipton Winter Mixed RACING County slots site started in February We are a long way from the days John V. Alecci Association, Inc. Lexington, Ky. (859) 255-1555. . . . . Feb. 7 when Marylanders owned the Maryland Howard M. Bender Laurel Park ...... Now through Dec. 18 Fasig-Tipton 2009. 6314 Windsor Mill Road, It is now obvious that our concerns tracks. Laurel, Pimlico and Bowie Train- Dale Capuano FASIG-TIPTON MIDLANTIC AUCTIONS Selected Two-Year-Olds in Training Phillip L. Capuano Baltimore, Md. 21207; Boynton Beach, Fla. were well-warranted. (See article on ing Center are now under the owner- AT TIMONIUM (410) 392-5555 ship of a Canadian real estate develop- William T. Fitzgibbons, Sr. (410) 265-6842; (859) 255-1555...... March 3 page 1.) Linda S. Gaudet December Mixed...... Dec. 6 Ocala Breeders’ Sales Company ment firm, MID, and a gaming company Fax: (410) 265-6841; As this newsletter goes to press, we H. Neil Glasser Two-Year-olds in Training...... May 23, 24 Selected Two-Year-Olds in Training still do not know how many days of live based in , PNG. E-mail: [email protected] (Entries close Feb. 14) Ocala, Fla. (352) 237-2154. . . March 15, 16 Christopher W. Grove racing—if any—will be run at Laurel The MTHA, as the official authorized Arnold A. Heft Web site: www.mdhorsemen.com Keeneland Two-Year-Olds in Training, The Horsemen’s Newsletter OUT-OF-STATE AUCTIONS Park next year. representative of Maryland owners and Timothy L. Keefe Lexington, Ky. (800) 456-3412. . . . .April 11 Here’s some of what we do know: trainers, must deal with track ownership reports on issues and events of interest Keeneland January Horses of All Ages, Ocala Breeders’ Sales Company Lawrence E. Murray to owners and trainers in Maryland. Lexington, Ky. (800) 456-3412. . .Jan. 10-15 Spring Two-Year-Olds in Training MI Developments (MID) has taken on as it exists. We don’t get to choose who John J. Robb Ocala Breeders’ Sales Co.,Winter Mixed, Your suggestions are welcome. Ocala, Fla. (352) 237-2154. . . . . April 18-21 a partner, Penn National Gaming Inc. See Thoughts, page 3 Katharine M. Voss Ocala, Fla. (352) 237-2154. . . . .Jan. 18, 19 (PNG). MID wants to run a schedule