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No plan in place at Maryland horse tracks

Maryland’s thoroughbred industry is once again racing through December without a plan to keep two struggling racetracks afloat in the new year.

The Maryland Jockey Club and thoroughbred owners and breeders missed a Dec. 1 deadline to propose a long-term, sustainable path forward for racing, one of two deals the club needs to settle before it can claim $12 million in state subsidies over the next two years.

The club and Penn National Gaming Inc., the owner of Rosecroft Raceway, are in arbitration over simulcasting rights at the Prince George’s County harness track.

A simulcasting deal must be reached before the club can claim $6 million from the state in 2012. And the long-term thoroughbred plan must be reached and approved by the governor before the club can receive another $6 million in 2013.

The club’s tracks, Laurel Park and Pimlico Race Course, must host a total of at least 146 days of live racing both years to receive the state aid.

“The track owners and the legislators don’t just want to kick the can down the road,” said Joseph C. Bryce, chief legislative officer for Gov. Martin O’Malley and his administration’s point person on horse industry negotiations.

J. Michael Hopkins, executive director of the Maryland Racing Commission, said the jockey club has sent the state notice it wants to race sometime in 2012, just not when or for how many days.

Bryce said talks have not “broken down” and the industry representatives hope to forge a compromise on thoroughbred racing’s long-term plan by the end of the year. Those negotiations over the long-term plan, he said, are slowing down plans for 2012.

“I wouldn’t say that ’12 is the major sticking point,” he said. “It’s ’12 being the first day of the rest of your life kind of thing.

“Part of the intent was to get some sort of path to how it will be sustainable in the longer run. Those are the types of issues that they’re talking about now.”

Citing an agreement to keep negotiations private, a spokesman for the jockey club and an attorney for the Maryland Thoroughbred Horsemen’s Association both referred comment to the state.

The uncertainty over the industry’s future could leave those connected to the industry in limbo, waiting once again for 11th-hour deals to secure another year of racing for the tracks.

With less than two weeks left in 2010, the owners of the jockey club offered a plan that would have guaranteed only a 47-day race schedule. The commission rejected the proposal, with some members of the panel calling for new ownership to take over the tracks.

The state stepped in with a $3.6 million subsidy to make 146 racing days palatable to the club.

Penn National, which had a minority stake, but veto power over major decisions at the club, has since sold its piece of the club to majority owner Frank Stronach, an Austrian-Canadian auto parts magnate.

Stronach has said the 146-day race schedule is unsustainable for the tracks, which have hemorrhaged cash in recent years. The state aid — taken from slot machine revenues that were originally slated for capital improvements for the tracks — and subsidies from the horsemen’s association were designed to bridge the gap to break even.

The jockey club lost $20 million at its thoroughbred tracks in 2010, according to partially audited financial data submitted to the state in March. That works out to almost $137,000 for every day the tracks held live racing.

The club lost $14 million at its tracks in 2009, and $12 million the year before that, according to unaudited financial reports.