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Deal offered for Pimlico, Laurel

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A new plan to keep the Preakness Stakes in Baltimore aims to make Maryland the nation’s horse racing epicenter, modernize Laurel Park and Pimlico race courses and revitalize the Park Heights neighborhood.

Proponents of the new strategy say it can be done without breaking the bank or spending a cent of taxpayer money, but it does require legislation extending the period of time that casinos provide Video Lottery Terminal (VLT) funding to the racing industry, which could still be a hard sell.

In contrast to the acrimony that defined the General Assembly’s 2019 legislative session, representatives from Baltimore, The Stronach Group (TSG), which owns both racetracks, and the industry’s breeders, trainers and workers put aside their differences to develop a plan that would benefit all of the stakeholders.

“We began with the proposition that we have to live within our means,” said Alan Rifkin, attorney for TSG and the Preakness Stakes. “It never would have worked and never will work if we have to reach into the General Fund.”

The Plan

The plan’s architects vowed to keep the Preakness at Pimlico even during construction, meaning the event could operate at temporary facilities for a year.
As currently envisioned, Laurel Park would be redeveloped first, with new barns and stable areas housing nearly 1,600 permanent stalls on land adjoining MD 198 and Brock Bridge Road.

Also, the plan includes a new dorm for up to 380 track workers built through a non-profit housing developer and repurposing the existing paddock as a public venue.

“That building is an iconic and important element of the redevelopment,” acknowledged Bill Cole, a partner in Columbia-based Margrave Strategies that represents Baltimore. In all, nearly 16 acres west of the track is earmarked for private commercial, retail and restaurant development.

A new synthetic Tapeta track, installed between the existing turf and dirt tracks, would double as a training track and an alternative surface when weather conditions make racing on turf or dirt unsafe. A smaller, more intimate clubhouse and grandstand would replace existing facilities, incorporating a central paddock area to afford better views of horses being prepared for races.

During construction, horses and training would shift to Pimlico, the Timonium Fairgrounds and possibly the Bowie Training Center.

Following work at Laurel, Pimlico’s track would be rotated 30 degrees and shortened slightly to optimize surrounding land parcels for redevelopment and a new, considerably smaller clubhouse would be built. Overlays for moveable seating and suite components would allow reconfiguration of seating each year based on demand and could be increased or decreased as needed.

According to Alan Foreman, general counsel for the Maryland Thoroughbred Horsemen’s Association (MTHA), a new racing museum is included in the designs and the stall that housed every Kentucky Derby winner would be preserved.

Who Pays?

Financing the project, which could take three to four years, requires each of the stakeholders to refrain from using their VLT funding for other projects, Rifkin said.
Contributions of $8.5 million from TSG’s dedicated Racetrack Facility Renewal Account (RFRA) funds, $3.5 million from Baltimore’s community impact funds and $5 million from the horsemen’s Purse Dedication Account funds would amount to $17 million in annual debt service funds, he explained.

The combination of a 30-year bond and the accumulated cash value before the bond debt is issued in 2021 would generate a total of $375 million for the project.
With a projected cost of $199.5 million for Pimlico’s redevelopment and $173 million for Laurel, “total project plans are about $373 million, leaving [more than] $1.5 million for issuance costs and the like,” Rifkin said. “The Maryland Stadium Authority has vetted that number and it’s a solid number.”

The Kansas City-based Populous architecture firm that designed Camden Yards was hired to create the initial designs.

Great Potential

Belinda Stronach, president of TSG, agreed to donate the 110-acre Pimlico site – valued at around $50 million – to the City of Baltimore, which would create a separate entity to manage the property and lease it back to TSG during the Preakness and any other racing events held there. For the rest of the year it would remain a community asset, giving Park Heights residents access to six athletic fields in the infield and other amenities.

Laurel Park would be kept by TSG but held in trust by the development entities and leased back for the 30-year period.

Moreover, TSG would pay the $8 to $10 million annual cost to build out Preakness Stakes seating overlays.

Speaking to constituents in early October on WYPR Radio’s Midday program, state Del. Sandy Rosenberg, whose district includes Pimlico, said TSG’s change of heart on bringing the Preakness to Laurel was likely influenced by last year’s legislative session.
“I think it became apparent that the legislature would not support a change in the law that would allow the race to be moved,” he said.

With so many details already accounted for, the biggest hurdle will be legislation to extend the expiration date of RFRA and community impact funds to coincide with the 30-year bonds, create the entity that will manage and oversee Pimlico and ensure community input in the redevelopment of Park Heights.

“I’m very encouraged that the two presiding officers (Maryland Senate President Mike Miller and Speaker of the House Adrienne Jones) issued a very positive statement calling this a win/win situation,” Rosenberg said. “The devil is in the details, but overwhelmingly what I’ve heard is that people recognize there’s great potential here.”

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