Let the Preakness Go

We’re about eight days away from the Preakness. Once again, the eyes of the sporting world will descend on northwest Baltimore for a horse race featuring two minutes of action and an eight-hour pre-game kegger, after which most people will forget about Pimlico and its surrounding neighborhood for the next year.

Invariably, as we approach race day, we will hear impassioned pleas about the need to ensure that the Preakness stays at Pimlico. WBAL’s Pete Gilbert and Brett Hollander had this very conversion on Sunday afternoon on Twitter.

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The point of contention between Hollander and Gilbert amounts to the idea that the Preakness will die if it leaves Pimlico.  This, of course, isn’t the first time that we’ve heard this song and dance; the Maryland Jockey Club threatened to close Pimlico 15 years go if slots didn’t happen. Well, to paraphrase a certain fictional Russian boxer….

Let me explain.

The underlying issue as to why the Preakness would leave Pimlico would be the facilities. The facilities at Pimlico are substandard and are not enticing to customers. The price tag for retrofitting Pimlico will be, in a word, steep. A study conducted by the Maryland Stadium Authority estimated that it would cost somewhere between $248 and $321 million. And the Stronach Group, which owns the track, wants you to pay for it:

The owners of Pimlico Race Course would need a “heavy commitment” from the city of Baltimore and state of Maryland if it is to keep running the Preakness Stakes at the 147-year-old racetrack in light of a study to be released Friday calling for $300 million in renovations.

The high price tag raises the question of whether the track should undergo a complete overhaul, or if relocating the Preakness is a more viable option.

Tim Ritvo, chief operating officer of Canada-based Stronach Group, which owns Pimlico and Laurel Park, said the company is not opposed to keeping the Preakness at Pimlico if the city and state are willing to help front the costs. But from the company’s standpoint it makes more sense to invest in one racetrack. Laurel Park is newer than Pimlico and will run around 140 days of racing this year compared to only 12 at Pimlico.

“It is hard for us to see why we would invest in two different facilities so close to each other and try to be financially responsible,” he said. “It makes sense to have one facility unless the state and city think [the Preakness] is important enough and are willing to invest in the facility.

“From an operational standpoint, it is not a struggle to operate two facilities. What is a struggle is investing in two facilities.”

As the comments from Ritvo note, Stronach also owns Laurel Park. Both tracks are run by the Maryland Jockey Club on behalf of the Stronach Group. And there are significantly more racing dates every year at Laurel as opposed to Pimlico. While the Stadium Authority study claims that the Pimlico upgrade could bring economic benefits of $1 billion annually, we already are aware of a significant body of research going back 20 years that shows taxpayer-funded sports facilities do not  generate the economic input that many claim.

With more racing going on at Laurel Park every year, it makes no economic sense for the state to spend a dime to rehabilitate Pimlico. That fact, of course, is not going to deter legislative Democrats in Baltimore City from forcing the issue:

Maryland Del. Samuel I. “Sandy” Rosenberg pushed hard to get a study done at Pimlico Race Course to look at what needed to be done to keep the Preakness Stakes running at the 147-year-old track.

Now that the results are back and the price tag is high, between $250 million and $320 million, with questions still looming about funding and alternative options, Rosenberg warned that Baltimore, the state of Maryland and Stronach Group, which owns Pimlico, can not just let the Preakness leave Pimlico.

“If the Preakness leaves the Cleveland Browns aren’t coming to Baltimore years later,” said Rosenberg, a Democrat whose district covers the Park Heights neighborhood. “Everybody is working to keep it here, but it isn’t a decision that you are going to find a replacement for.”

Rosenberg is right insofar as that if the Preakness leaves Baltimore nothing will come to replace it. But at present, Pimlico is used for racing two weeks a year. The major economic benefit to the residents of the Pimlico neighborhood goest to the folks who make money selling their yards for parking space. There are little year-round economic benefits for state taxpayer dollars to be spent on upgrading a barely-used horse racing facility.

That’s not, of course, to say that we would want the Preakness to leave Baltimore. The Preakness is part of the city’s heritage and losing that would be unfortunate. However, just because the Preakness has always been at Pimlico is no excuse to spend hundreds of millions of taxpayer dollars on a massive renovation project for a rarely used facility. This is doubly true if Stronach intends does as many expect them to do; move the Preakness to Laurel Park. The Preakness moving from Pimlico to Laurel would retain the economic benefits of holding the Preakness in Maryland without any additional state funding being spent on Pimlico.

If the Stronach Group wants to keep the Preakness at Pimlico: great! They can do so by investing their money into their property for the purpose of keeping their event at their track. There is no public interest served by spending $300 million of state tax dollars on a track when that money can be better used to lower taxes, fund K-12 education, or improve our transportation infrastructure. While it would be unfortunate if the Preakness left Pimlico for Laurel, or left Maryland for another state, the benefits to our state economy do not outweigh the costs that would be borne by Maryland taxpayers. We can’t afford to see money that could go toward meaningful projects or meaningful tax cuts go to horse racing,

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