The Maryland Jockey Club is now free of the legal entanglements from their failed bid to obtain a slot license at Arundel Mills Outlet Mall, but recently submitted financial statements suggest that there’s plenty of red ink to go around. The organization that provides oversight for horse racing in Maryland lost money at both major tracks in the state including Preakness Stakes host facility Pimlico.
The filing of financial statements had been delayed by the bankruptcy of the Jockey Club’s previous owner, Magna Entertainment and showed an overall loss of $28 million in 2008 and 2009. There is some light at the end of the tunnel, however, as guidance provided by the Jockey Club suggested that a breakeven 2011 is a realistic possibility.
Not surprisingly, Pimlico is in better shape than Laurel Park due in large part to the Preakness Stakes. The two tracks lost a combined $6.1 million in 2007, which included a profit of $1.8 million at Pimlico. In 2008, the tracks posted losses of $10.9 million at Laurel and $901,556 at Pimlico with losses of $11.5 million at Laurel and $2.6 million at Pimlico in 2009.
Jockey Club President Tom Chukas noted that even with all of the expenses earmarked to expand the revenue from slots and other forms of gaming, the statement paints a bleak picture due to a decrease in wagering handle at both tracks:
“Even deducting all the efforts for gaming and related causes, you’re still in the $7- to $9-million losses from operations.”
Things are looking up, however, due in large part to subsidies of over $5 million from the state of Maryland and the state’s horsemen’s groups. Chukas is hoping that 2011 will see a breakeven figure as the relevant stakeholders map out the future of horse racing in the “Old Line State”:
“We’re hopeful between all those things that at the end of 2011 we should be at approximately a break-even, plus or minus a few dollars.”
“The industry has had some meetings and continues to meet to develop a strategy that, hopefully, will come up with some new ideas, generate some additional revenue, and put us in a place that is a long-term solution to this. Ideally, the Maryland Jockey Club would like not to take any funds from the state. We would like to make this a profitable enterprise with no state subsidy. Unfortunately, at this juncture we haven’t been able to do that.”
Part of this, the Jockey Club hopes, will be a bigger cut of revenue and possible expansion of slots offerings at Maryland horse tracks.