In which we analyze the state of the racing industry. Part 1 of 2. (Featured image by Jim McCue, Maryland Jockey Club.)
On April 14 — Wild West Day at Pimlico — a few cowboys “herded” some cattle, who wandered lazily down the stretch. It was an odd scene and, to most in attendance, a baffling way to promote horse racing at one of the sport’s great historic venues.
Later that night, the eyes of the racing world turned to Charles Town — yes, Charles Town — as a top-class field came in for the $1 million, Grade 2 Charles Town Classic.
And one local horseman turned to another and said, “There’s a million dollar race at Charles Town tonight, and we have bulls walking on the racetrack. What is going on here?”
What was going on probably is the same thing that’s been going on in Maryland for most of a decade: an industry that has lost its hold on the public — and its way — trying to regain its stature.
HANDLE PLUMMETS
In 2003 the great racemare Xtra Heat closed out her glorious career by zipping through a dense fog to defeat Carson Hollow and five others in the Grade 2 Barbara Fritchie Handicap. Bettors poured more than $897,000 into the win, place, show, exacta, and trifecta pools on the Fritchie that day.
By 2012, the Fritchie — still one of the highlights of the Maryland racing calendar — attracted wagering of less than $300,000: almost precisely one-third of what it had been nine years earlier.
Unfortunately for the Maryland Jockey Club (MJC), which owns the racetracks, and for the state’s horsemen, breeders, fans, and bettors, the Fritchie was hardly an outlier. In just the five-year period from 2006 to 2010, wagering on live racing at Laurel and Pimlico dropped by 55 percent, falling from more than $600 million to just a shade over $270 million, according to figures published by the Maryland Racing Commission.
One of the proposed solutions to racing’s economic woes beloved by some commentators — and anathema to horsemen who have bills to pay — is less of it: to reduce the number of racing days. But while Maryland has done that, it has not stanched the bleeding. As recently as 2001, the state’s two major tracks hosted 221 days of live racing. It was still 184 days in 2006, but by 2010, that number was just 140 days, a decline of nearly 24 percent in just five years (and nearly 37 percent in 10 years).
Even so, during the period from 2006 to 2010, the average daily handle of the two tracks plummeted by 41 percent. And although handle declined significantly nationwide during this time, Maryland racing nevertheless saw its market share decline nearly in half.
Of course, all of that is bad news not only for the horsemen but also for the racetracks. Laurel and Pimlico were profitable through the first part of the 2000s, but in recent years their books have become seas of red ink. In 2010 the tracks lost about $20 million, according to the Baltimore Sun. In 2011 that number was reduced to $5.3 million — in no small part because of subsides totaling more than $5 million from the state and from the horsemen. That sea of red ink has led to, among other things, a decline in the quality and consistency of medication control and other regulation in the state, resulting in what one attorney called, in a case before the state Racing Commission, “complete regulatory anarchy” on the backside and yet another black eye for our industry.
BREEDING INDUSTRY STRUGGLES
The industry’s struggles at the betting windows are mirrored in its breeding statistics.
The state’s breeding industry was known for its innovation. Maryland was the first state to create a state-bred program. And its Maryland Million Day, for Maryland-sired horses, was the nation’s first such program.
You can see the results in the names of the stallions that stood here and the racers born here: Northern Dancer at stud, Cigar, Derby-Preakness winner Kauai King, among many others. And the fabulous crop of 1980 included Preakness winner Deputed Testamony, Belmont winner Caveat, and Dixieland Band, who bested those rivals in the greatest Maryland Juvenile Championship of all.
That was then. Now Maryland’s once top-flight breeding industry struggles to keep up. The size of the foal crop has declined from more than 1,700 in 1991 to 474 in 2010, and reports are that the 2011 crop will number less than 300. Whereas more than four percent of the nation’s foals were once Maryland-breds, that number is now about 1.5 percent.
The regional sire lists were once the exclusive property of Maryland stallions. Breeders from around the region flocked to the state to breed their mares to sires like Allen’s Prospect, Not for Love, Two Punch, Polish Numbers, and Carnivalay. These days, the high purses, rich breeder awards, and year-round racing available in Pennsylvania have made that state the region’s top breeding locale.
Remarkably enough, given inflated purses increasingly available, the top six all-time earners among Maryland-breds — and nine of the top 10 — were born before 2000. Four were born in the 1980s. By contrast, four of the top 10 Pennsylvania-bred earners were born in 2001 or later, and only two were born in the 1980s.
Part 2 to follow tomorrow.
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Michael
April 25, 2012 at 2:37 pm (UTC -4) Link to this comment
I cannot seem to locate the exact date but my guess is that the dip in handle coincides with Stronach removing the Maryland signal from TVG to his own network of HRTV. Don’t get me wrong, I think HRTV is far superior with its personalities and programming however, in reality, TVG reaches over 10 times more customers (just by cable alone) than HRTV. Not to mention, HRTV has so many tracks to cover from January to Derby Time that they frequently stop showing any Maryland races after the 4th or 5th race on the weekends. Coincidently, Charles Town is setting records with its handle and it has the evening on TVG almost to themselves. Stronach may have made a good personal decision, but it was (is) an almost fatal business decision. And although he is extremely successful, he allowed his heart to decide over his head. and for that, everyone in Md Racing is paying.
admin
April 25, 2012 at 2:55 pm (UTC -4) Link to this comment
Thanks for checking in, Michael. It’s an interesting point you raise and one that potentially opens a whole ‘nother can o’ worms. Yup, there’s plenty of blame to go around, and we’ll look at some of that tomorrow.
@luvfades1
April 25, 2012 at 5:49 pm (UTC -4) Link to this comment
RT @ThatsAmoreStabl: We look at the perilous state of Maryland racing, just a few days out from key MTHA vote… http://t.co/u8dbDVOr
(@turfbloggers) (@turfbloggers)
April 26, 2012 at 10:15 am (UTC -4) Link to this comment
Time is of the essence for Maryland racing; @ThatsAmoreStabl with part 1 of 2, facts, figures of its decline http://t.co/cDK2UVbd
Ted
April 26, 2012 at 11:58 am (UTC -4) Link to this comment
I note that you failed to mention the Decanter, two day wine festival the following weekend. The grandstand was overflowong with young people, the stands were full, and the apron was also crowded. The roar that went up when the gate opend in front of the stands, sounded like Preakness Day. It was a great day of racing and a wonderful experience for many 1st time attendees. The handle for the Pimlico meeting is up, and maybe bulls on the track didn’t light you up, but we are trying things to attract new customers, and some of them have been successful.
admin
April 26, 2012 at 12:13 pm (UTC -4) Link to this comment
Thanks for weighing in, Ted. In fact, I spoke at an MHBA event at Decanter, tweeted about it several times, and was very impressed with the turnout – It was a very good event and put a lot of people in the seats, many of them firsters. I certainly am a fan of trying new things, and I’m well aware that some will succeed and some will fail. Also glad to hear that handle is up so far for PIM meet – of course, getting hold of accurate handle figs from the MJC is something of a challenge, since they don’t release them or compile them on charts, which makes it hard for me to refer to. Just sayin’.