Hogan slams funding provision for $372.9M Pimlico-Laurel plan

Gov. Larry Hogan said a key provision of a proposal to save the Preakness Stakes in Baltimore that uses money from the state’s Education Trust Fund is a “terrible idea.”

Hogan made the comments to reporters following a one-hour meeting at a Baltimore diner in advance of his State of the State address scheduled for Wednesday. In addition to breakfast, discussions about crime and economic development, squeegee kids,  and other issues in Baltimore.

Hogan said he supports keeping the Preakness in Baltimore and at Pimlico. The Maryland Jockey Club, the city, owners of Pimlico and the Preakness and members of the Park Heights community have a $372.9 million plan they believe will keep the race at its historic northwest Baltimore home while also revitalizing racing at Laurel Park.

“I’ve always said that I’d like to see the Preakness stay here in Baltimore,” Hogan told reporters outside the Broadway Diner in Baltimore. “It’s got such a history and tradition here. It’s important to the city, and we’re looking forward to discussions about how that can be financially viable.”

Supporters of the plan, which is backed by House Speaker Adrienne Jones, were briefed on it Friday. Legislation establishing the framework for the deal is expected to be submitted tonight or tomorrow, according to State House sources, and will not involve diverting money from the Education Trust Fund.

The plan when it was unveiled included using $8.5 million annually from slot machine revenues earmarked for improvements at racetracks to pay for $17 million in annual debt payments for the work at Pimlico and Laurel. But that funding sunsets on a rolling basis as each of the state’s six casinos hits the 16th year of being open. As those funds sunset, they revert to the state’s Education Trust Fund.

The revised proposal would let those funds revert to the Education Trust Fund, and instead proposes using lottery revenue to make up the difference once the racetrack improvement funds revert to the Education Trust Fund.

Hogan called the use of money from the trust fund to prop up racing “a terrible idea” as lawmakers grapple with how to pay for a massive expansion of spending on public education that tops $4 billion annually once it is fully phased in,

“We’re talking about (the General Assembly) trying to come up with $33 billion more to fund Kirwan, and they’re talking about taking out potentially $180M or $200M out of education. It doesn’t seem like the right way to go,” he said.

Reporters were not allowed to sit in on the meeting between the invited guests and the governor. Only Hogan spoke to reporters following the meeting, Some who attended the meeting declined to speak about the discussion saying the hour-long conversation was “off the record.”

The discussion is the last public event on Hogan’s schedule in advance of the Wednesday’s speech. Hogan has not revealed specifics of the speech but is expected to discuss violent crime and efforts to make Baltimore safer.

Hogan described the concerns expressed “as nearly the same concerns we hear every day. We hear about the violence in the city and the fact that we have almost 1,000 people shot last year and 348 people murdered and in spite of a lot of efforts from a lot of people, we haven’t been able to solve that situation.”

Hogan said he plans to revisit his proposal to lower violent crime when he delivers his speech on Wednesday.

Also on the minds of some, according to Hogan, was the issue of so-called squeegee kids.

“It’s a problem,” said Hogan, describing the breakfast meeting as “more of a discussion about the really violent crime and the shootings and the murders but squeegee kids was an issue. One of the ministers had a program where they were trying to employ some of the squeegee kids, but the problem is some of these squeegee kids make $40 or $50 an hour harassing people on the streets, and it’s hard to replace that with a job.

“I told them how I thought it’s driving people, keeping people from coming into the city because they are tired of being harassed on the streets,” Hogan said.

Business writer Adam Bednar contributed to this story.