Horse Racing in Maryland, a $2 Billion Industry? Wanna bet?
Written by Mark · Filed Under Big Business, Politics
December 10, 2007 | Print this post
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The MoBseen: Life’s observations as seen through the eyes of Mark.
We, the voters of the Free State, will have the chance to vote on slots coming to Maryland.
Current polling by Gonzales Research & Marketing Strategies and the Washington Post Polling suggest that Maryland residents are in favor of Maryland slots and those favoring slots continue to outnumber those opposing slots. The question remains of course, where to put the parlors and who will be the beneficiary of the millions generated by this new gambling.
I should point out to those opposed to Maryland slots that we already have gambling in Maryland and on a very broad scale; We have The Lottery, Lotto, The Daily Pick 3, The Daily Pick 4, (twice a day!) Bonus Match 5, Mega Millions, Multi Match, Racetrax, Maryland Hold’em, Keno, Scratch-Offs, and of course horse racing. We also have Off Track Betting (OTB) and XpressBet.
The fact is, we have no shortage of vehicles to separate money from man and woman here in the Free State! These, of course, are all state-ordained gambling games. This in addition to all of the illegal numbers that are run everyday and the illegal slot machines in bars throughout the state, bingo nights at churches, VFWs and fire halls (these licensed by the State) and of course the office pools during March Madness.
The politicians, led by the both Governors Ehrlich and O’Malley, have and are supporting slots. This in itself is not what puzzles me, it’s the justification that is used to “sell” the slots to the constituents.
Slots are touted as the panacea for the dying horse racing industry here in Maryland. We’re told that without the infusion of millions of slots dollars and the increased purses that would be derived from slot machine gambling that the $2 billion a year horse racing industry will fold.
Governor Ehrlich was quoted as saying that horse racing is “in excess of a $2 billion industry worth saving in this state.” What’s more, Ehrlich made this claim to the House of Delegate’s Ways and Means Committee in May 2003.
We’ve heard this for years and it has me thinking, exactly where does the $2 billion come from and where did the Governors get this number.
The Budget for the State of Maryland is approximately $1,472,263,097. This includes the Department of Education, Department of Corrections, Maryland Department of the Environment, Department of Labor , Licensing and Regulation, Board of Public Works and a laundry list of other bureaucracies. The dying horse racing industry is larger than the Maryland state budget!
Of course the politicians are talking economic impact. So I looked at an “industry” such as NASCAR and what it contributes to the economy of a state. By the way…why is it called the “Horse Racing Industry?” We don’t call the Ravens the “National Football League Industry” or refer to the Orioles as being part of the “The Major League Baseball Industry”
What I found is that the $2 billion impact that is being tossed around is greatly exaggerated. Some research shows that the 2006 Super Bowl in Michigan generated an estimated $302 million dollars in economic impact dollars. Michigan NASCAR generated $400 million dollars in “total economic activity” in 2006.
The NFL and NASCAR rank number 1 and 2 in American spectator sports and they draw tens of millions of fans each year and yet they are responsible for only 25% of the economic impact of our horse racing industry per their state! Amazing! Add to this the fact that the horse racing industry is dying and yet the economic impact stays constant! It just doesn’t add up!
It tires me when people write letters to editors and call talk radio shows threatening to move out of Maryland because they are horse breeders and they can’t make a living here in this state. They say without slots and the increased purses they cannot survive? Why not?
Why can’t they breed their horses here and ship them to the other states. I bet they eat food that is not grown in Maryland but is shipped in. I bet they watch television on a set that is not made in Maryland. We make steel and wine here that is shipped out of state. Must I go on?
The total monetary value of all agriculture, forest and fisheries in the state of Maryland is $1.6 billion. The horse racing industry alone, surpasses that number by $400 million, according to 2003 figures. That is, if we are to believe the politicians.
A 1999 study by the Office of Business and Economic Research in Maryland determined that the Ravens generated $184 million in overall expenditures. The Ravens! An NFL franchise that is the country’s number 1 spectator sport. A far cry from the “dying horse racing industry” claim of a $2 billion impact! Think what the impact would be if the sport wasn’t dying!
Then we’re told that we must save the Preakness, the granddaddy of all of Maryland horse racing, at all costs because of the “economic impact” of the event and the history of Maryland horse racing.
Give me a break! No one cares about the Preakness…it’s all about the party! Politicians go to be seen so that they can say they were there. Ask them if they have been to Pimlico in the previous 364 days and bet on the horses. I’ll bet they say “no.” And do you ever see the first ladies wear those big hats on any other occasion other than Preakness? What do they do with them after the Preakness? The Goodwill Store maybe?
Then ask the crowd that makes up the infieldthe same question and they’ll probably answer “What horse race?” The infield is an excuse for college age kids to drink beer and have a good time. If you want to keep the “economic engine” running in Pimlico, move the WHFStival to the infield on the third Saturday in May. It’s the same crowd. They’ll drink the same amount of beer but spend more on a ticket than the $50 a Preakness infield ticket costs.
Ask anyone if they can name 3 jockeys or 4 current race horses, what a furlong is, how long a track at Pimlico or Laurel is or what is a stone or a hand. Good luck getting the answers.
The local networks have long stopped giving the racing results from Laurel and Pimlico. I can tune in and watch girl’s basketball and high school football highlights but I can’t find out who won the third race at Laurel. Why is that?
There is no demand for the results. If we are to believe that Maryland horse racing enthusiasts are heading to other states to bet on the ponies then why don’t the local networks give those track results? See where I’m going here? Maybe it’s because no one cares.
There is horse race betting in the casinos in Atlantic City and Las Vegas as I’m sure in other states, but again, look where they place the betting areas in the casinos - in the back.
Sometimes you can’t find them and have to ask where they are. If they were that popular, my guess is that they would be right up front; right there when you walk in. Take a look at the billboards advertising the out-of-state casinos with horse racing. They make no mention of the horses but stress the slots and/or upcoming concerts.
The bottom line is that the bottom line has been greatly exaggerated to get you and me to support slots because the horse racing industry needs it. Balderdash! The sport of kings is dead! We have no kings in Maryland.
Now, am I against slots…No! I would rather see full blown casinos in the state with gaming tables though. Slots bring in the day-trippers and the small rollers. Gaming tables such as Blackjack, Baccarat, Craps and the like tend to draw the higher rollers. My gut tells me that these people tend to spend nights in the hotels, rent the limos, buy the jewelry and artwork and consequently spend more money.
Am I against horse racing…No! I just want it to stand on its own or at the very least, draw enough public interest to warrant a small amount of public subsidy. But $2 billion is a lot of dough, more than the NFL and NASCAR generate in a state like Wisconsin! That is if we are to believe what we’re being told.
I’m not even against horses. I love animals and the older I get the less I want to see animals and people suffer. So much so, that I don’t want to see them ridden and whipped so that someone can win a couple of bucks.
The fact is, without betting, there would be absolutely no horse racing! We watch the NFL and NASCAR and baseball every day/weekend and I never bet on them. Sure, some people do. The vast majority of their fans do not!
I’m not against the open spaces that raising horses requires either. However, my guess is that the majority of what passes for horse farms in Maryland do not raise thoroughbreds but some other breed of horse. A horse that is not used in racing might be a standard bred or quarter horse or maybe just a pet horse, but they are all grouped together as horse racing farms.
The $2 billion that is generated from Maryland horse racing just doesn’t add up, not by a long shot.
The sport of kings is dead. Long live the king.
Mark,
All of your arguments are spot on. The impetus for slots and casino gambling is now, and always SHOULD have been $$$$ in the state coffers. Period. People are going to gamble, and why should they take their money across state lines to give it away there? Give it away here!
I am against government subsidy of any “recreational industry.” Why do we spend millions (hundreds of millions?) building sports palaces for NFL and MLB teams? The economic impact? Impact on who? The state’s returns on these “investments” are a drop in the fiscal bucket.
Where are the lobbyists for the Skipjack building industry? We must keep Skipjack building alive and viable in Maryland. Who will speak out for the cannonball manufacturers? All of those long dormant shot towers. Think of the economic impact. Wheelwrights? We can’t forget the wheelwrights! Where would Maryland be without expertly crafted wooden wagon wheels?
Slots are a cash cow. Let’s milk this sucker. But to prattle on about the sport of kings is folly. Entertainment “industries” should stand or fall on their own. Why should horse racing be any different?
I agree, the arguement that this industry needs to be bailed out is crap. It’s just another strategy to get gambling legalized in MD.
Personally, I think a state making its money off of the weakness and bad luck of its citzens is an incredibly bad idea. No one has yet proven that the money they promise is really there, so why stoop so low as to take advantage of the sins of your neighbors? Why add another legalized bad habit that we’ll have to sudsidize all sorts of other impact programs to combat? Ask yourself, “Does it pass the smell test?” To me it stinks.
Not to mention, and this is something no one else in the state is apparently willing to admit, doesnt legalizing casinos and slots in MD extend an embossed invitation to organized crime to move in? I mean, more then they are already? Isnt that their business, taking advantage of huge rivers of hard to trace money flowing from one pocket to another?
It might be fun to gamble in Perryville, but where do you think the accompanying corruptions of drugs, prostitution, political pay outs, alchoholism, and general decay are going to go?
Take a trip to Atlantic City, and walk a few blocks west, and you’ll see what I mean. And good luck, you’ll need it.
Joshua,
Youre correct that adding yet another vice to the already crowded pool will foster a whole new set of issues (hello Gamblers Anonymous), but it is a genie that is already out of the bottle. Ever see the parking lot at Dover Downs? Count the MD license plates. Ditto Charlestown West Virginia.
Those that will gamble, will gamble. It is foolish to keep letting that potential revenue source continue to go to other states.
It is time MD took its cut. The biggest issue will come when the NIMBY crowd starts sabre rattling as the referendum draws near.
Like that rastafarian said in the classic Steven Segal epic “Marked for Death”: Everybody want go to Heaven, nobody want die.
Dell,
I dont want to take a cut of a profit made from the despair of my neighbor.
There are times when you have to say screw the money, its the wrong thing to do. This is one of those times. Are we really that bad off that we have to take this step? I dont think so.
The NIMBY crowd wont have to worry, because the locations of any casinos were decided years ago in smoke filled back rooms. Out of state back rooms.
I live in Baltimore County, so my neighborhood will be ok.
But you guys in Harford and Cecil, well, theres certainly a lot of large development tracks along the 40 corridor, arent there?
Any local law enforcement feel like chiming in? It seems to me have more then a vested interest in where these things will go.
I’ll gladly chime in, in response to my own post. I’m in local LE, and have been since 1996.
With all due respect, I’m not buying the “despair of my neighbor” thing as an anti-slots argument. Like Mark said in the article, the State of Maryland already has several inventive ways to separate a fool and his money. Slots are just one more, and a more lucrative one at that.
Sure, you can certainly make the argument about the peripheral consequences like drugs, prostitution, and the drag on Law Enforcement resources. But take Atlantic City away. Nobody is comparing Dover Delaware and Atlantic City, New Jersey. Or WV and Atlantic City. Is there a huge drug, prostitution and general decay problem in either of those places? I’ve been to Dover recently. The Las Vegas strip, it ain’t.
If anything, law enforcement would be hand delivered a ready made argument all chiefs, sheriffs, or police commissioners love: I NEED MORE MANPOWER (aka I NEED MORE MONEY IN MY BUDGET)! And they would get it. In some LE circles, they call this “job security.” It is indeed what you referred to as a “vested interest.”
Dell,
Thanks for responding so candidly. And, with equal respect, why don’t you buy the “despair of my neighbor” thing? Do you disagree with my notion that it does spread despair and misfortune, or are you saying the potential benefits outweigh them?
And if thats the case, exactly how many lives and families need to be ruined before it counterbalances? A dozen? A hundred?
Yes, we already have the lotto, and keno, and church bingo, et al. Thats like saying, well, “I’ve already tried pot and coke, I might as well try crack and heroin too”.
And, while you have a point about Dover and WV, you can’t take Atlantic City away. It’s real, and the crime and corruption are real. Does the barely holding on Baltimore City Police Department need another front to fight?
And where would the money for increased law enforcement budgets come from? I guess from slots, so we need slots to pay for the cops we need because we need slots. So much for the schools.
And I’m hoping you are exaggerating when you suggest that police welcome increased crime as job security. Thats like a doctor encouraging his patients to take up smoking. All that cancer will keep him working for years.
There must be dozens of other fund generating steps MD could take before crossing this line. Why arent we exploring any of them?
OK, time for me to chime in. I’ve been meaning to, but got too caught up playing with webkinz…
While slots may take advantage of the poor, the parlors will also create many jobs, whether in customer service, security, food and beverage service, etc. I also agree with Dell about the maryland gambling areas comparing more to Dover than AC. AC has full gambling for one, and it’s proximity to NYC made it appealing to certain crime elements.
There is already despair and misfortune in the city, and it’s not due to the lottery or any other form of gambling. Only problem is the city doesn’t make money prosecuting drug and violent crimes.
Personally, I would like to see full gambling in certain established resort areas throughout the state. Baltimore City is not such an area. Put a casino resort in each of the four “corners”: Rocky Gap, Bainbridge, Charles County, and OC. Then have slots only at the tracks.
I don’t disagree that there is an element in our society for which gambling would place undue pressure on their already limited resources. But the drug comparison is a little bit of hyperbole. “I’ve tried pick three and pick four, so now I’m going to play Powerball.” (I’ve never seen the victim of a Keno overdose slumped over the wheel of his car.)
I’m suggesting that there is a legal, state-sanctioned revenue stream (slots) that is being exploited in adjoining states, to our detriment.
These are numbers from MD DLLR:
Charles Town, a racetrack and slots venue in West Virginia, which opened ten
years ago and has 5,000 slot machines, generated $448 million in gross revenue in 2006, more than any other racetrack slots venue in the country.
• Maryland is Charles Town’s most lucrative market, and Charles Town’s most
lucrative geographic market within Maryland is Montgomery County. At Charles
Town and other West Virginia slots venues, Marylanders accounted for roughly
$150 million to $200 million of the gross revenue in 2006.
• West Virginia’s various racetrack slots venues paid $445 million to state and local governments in 2006.
• Delaware’s racetrack slots venues (Delaware Park, Harrington Raceway, and
Dover Downs) generated gross revenues of more than $651 million in 2006.
Marylanders accounted for roughly 30 percent of the total revenues from slots, or
approximately $200 million.
• Delaware’s racetrack slots venues contributed $232 million to state and local
governments in 2006.
• Charles Town’s number one status could be in jeopardy, because although
Pennsylvania has had slots for less than a year, so far in 2007 more than $5 billion has been wagered on slots in Pennsylvania, bringing in more than $455 million in revenue. The state’s cut of that revenue totals more than $250 million.
• Marylanders playing slots in West Virginia and Delaware contributed
approximately $150 million to the tax coffers of these states in 2006, and it is not
yet clear how much more has gone to Pennsylvania in 2007.
ONE HUNDRED AND FIFTY MILLION DOLLARS!! That’d sure ease somebody’s dispair and misfortune.
“The State” doesn’t want you to smoke. It’s a tremendous drag on the health care system. So they TAX cigs to the bejesus belt. And some of that revenue goes back into the health care system. Ditto gambling. “The State” doesn’t want gambling addicts, pawning grannies wedding ring, selling plasma, breaking into their neighbors house to steal their big screen TV.
But I submit to you that the people who would frequent these slots facilities are made up of two main groups. Those who are now trekking out of state and flushing their money in slots (or doing it illegally in any number of locally available venues), and those who are already flushing their money on scratchers, keno, RaceTrax, and the like. Again, those that will gamble, will gamble.
And since I’m rambling… no police is ever going to wish for more crime. The “job security” comment is kind of an inside thing, gallows humor if you will. Kinda like watching somebody take a fastball in the groin and saying “Ohhh, did that hurt?”
Anyway, SLOTS GOOD, CRIME BAD. VOTE QUIMBY!!
Steve,
I was typing my manifesto while you were striking it rich in Webkins land. I have this vision of some other 30-something dude on the other end of a computer somewhere trying to get the flat screen TV for his Poodle!
“Rock dammit!!! Rock!!! Paper is for losers!!!”
“KING ME, Beyotch!!!!”
VOTE QUIMBY!!
ONE HUNDRED AND FIFTY MILLION DOLLARS!!
Wow, I’d do just about ANYTHING for ONE HUNDRED AND FIFTY MILLION DOLLARS!!
Guys, it’s not that much. Not nearly enough to justify the risk of handcuffing the state to an anchor of crime that could go on for generations.
We could hope that it would end up more like Dover then Atlantic City, but come on. What state politician of any party has proven themselves able to handle anything like this? O’Malley? Ehrlich? Mike Busch? Michael Steele(who?)? Maryland is a state that has been defined for the last hundred years at least by its corrupt political system of old boys and one party rule, and you guys suggest handing them ONE HUNDRED AND FIFTY MILLION DOLLARS of loose change to distribute how they seem fit.
I still maintain that “those that will gamble, will gamble” is no way to plan the economic future of your state.
Steve, the jobs you talk about are minimum wage service jobs at best. That is, if they dont just hire illegals to do all of that work. When you say “While slots may take advantage of the poor,” for me the arguement is done. The poor are not just living in Baltimore, they are in every community in MD. They are your neighbors. Even if the moral implications of that mean nothing, what happens to the poor that slots take advantage of?
As for the day trippers, let them drive over the borders, take the pot hole cratered Pennsylvania highways. Let Pennsylvania and WV try and figure out how to live with their New Jersey “managers”.
There have to be better, more stable ways of stimulating your economy. Ones that involve an investment in the future rather then a mugging of the present.
Josh,
They are minimum wage service jobs, and are the exact type of jobs the city needs!
And if you want to stimulate the state’s economy, you cut taxes! It’s really simple. But that won’t happen in this state, because the legislature seemingly dreams up new social services that need funding. And they’ll do so behind everyone’s backs during “special sessions”.
In what world do more crappy minimum wage jobs help out anybody except the rich?
Thats the last thing Bmore needs, they need real jobs with benefits so workers can have a hope of providing for themselves. Not the “32 hour a week but really 42 but you can’t claim it because we dont want to pay your insurance, and if you dont like it or try to unionize we’ll fire your ass so fast because theres a million other poor slobs out there looking for a scrap” kind of job.
And like I said, they’d probably just give the jobs to illegals and then pay them god knows what.
Is anybody willing to comment on any of the moral implications of this? Or is it all just magic money from the pockets of the poor, that will somehow find its way to where we most need it?
josh it’s a fact’ the state of maryland was concerend about free access to slot machine’s. due to the fact the welfare recipients will be spending’ our money’ gambling.
there’s alure about slot’s that just seem to draw the poor’ more so than horse raceing or lottery. and where there is gambling. there is crime.
I’am aware delaware & charlestown is getting some hard earned buck’s from the working class.but watch & see what happen’s if they become easy to access.
There are no moral implications. I don’t want “The State” preaching morality to me. I take a kind of Libertarian view on this. You do what you do, I’ll do what I do, as long as what you do doesn’t infringe on me or my rights, so be it. Slots are legal, slots are here, no animals were harmed in the making of the slot machines, they’re not putting them in elementary school cafeterias, you can’t win a free handgun if you get three cherries in a row. They don’t use lead paint, emit no CFC’s, have never been accused of genocide, and they have not been found to cause birth defects.
If you live by “the code,” it is a zero sum game for you. Maryland with slots will be no different for you than MD without. It’ll just be hundreds of millions of dollars richer.
And since you’re safely ensconced in Baltimore County, the evil one-armed bandits will be far, far away from you anyway. No moral dilemma here.
Ask an unemployed single parent what these “crappy minimum wage jobs” will do for them. If they are not so addicted to being on the dole, it would be an opportunity to climb (albeit slowly) from poverty.
I’ve been there. In 1995, I was supporting a wife and a two year old on $5.50 an hour. It was my choice to decide that I DIDN’T NEED TO STAY THERE. “The State” didn’t come to my rescue.
“Magic money from the pockets of the poor” falls right in line with the “despair of my neighbor.” If the population of Maryland were as poor as you claim, why does MD rank so high in per capita income? What are all of these people doing? Stuffing money in shoeboxes? Hell no! They’re paying taxes! And I mean ALL KINDS OF TAXES. I bet middle class people smoke cigarettes. And drink alcohol, and put GASOLINE in their SUVs! Gasp! I’d hazard a guess that those wealthy Howard and Montgomery County Democrats do, too! What? The burden of supporting the infrastructure in the State of Maryland is not laid at the feet of her working poor? Shocking!
VOTE QUIMBY!!
In honor of the passing of Ike Turner, can I get a “NOM-YO-WHRENGAY- QUHO?”
I’m not talking about the state preaching morality. I’m talking about the morality of myself individually profiting from gambling. And yourself individually profiting from gambling. Or at least we assume there would be any profit at all, something that I think is still in doubt.
VV hit it right on the head, “and where there is gambling. there is crime”. Doesn’t crime infringe on your rights? Doesn’t the decreasing of safety in your community affect your rights? Doesn’t the political corruption sure to spread from millions of dollars in untraceable cash affect your rights?
In my mind, this out of state manipulated machine to get slots legalized in MD DOES affect my rights. The whole point of Mark’s piece was how we dont need to save the horse industry. Who do you think comes up with figures like “2 billion dollars”? I dont like being lied to. It makes me real mad. Why should we believe anything connected with the pro-gambling industry (and really, thats the only industry thats going to make any kind of profit here)?
I wasn’t bragging about living in BC, BTW. I was trying to point out that Harford and Cecil counties are going to be on the front lines of this.
Dell, and all, I appreciate your comments. This is EXACTLY the discussion that is not occuring in the mass media, they talk about it every day and never get into it. This is why we have the Dagger.
Not sure if I can do this or not….
Ok, I was trying to embed an early clip of Ike and Tina singing, but looks like its a no go.
Sorry, didn’t mean to imply that you were bragging about where you live. I just don’t get an excuse to use the word “ensconsed” very often.
Anyway,
Whether you profit individually from gambling should be your own choice. I personally loathe gambling, and gamblers. It is irresponsible and reckless. It is my hope that when slots come (as they most certainly will), the monies produced will be used by the state to pay for a lot of the social programs that I believe the state shouldn’t be involved in, anyway. A LIBERAL DREAM!!
Like Steve said, it’s not as though the state will ever lower taxes, or allow me to put anymore of my own money in my pocket. So, if gamblers want to prop up the economy, good for them.
You’re probably thinking, more money for law enforcement gets right back to me profiting from gambling. I guess that is an unaviodable by-product of what I do for a living. The same applies to any civil service job, in that argument, right down to the guy working for MDE testing the pH in the Bush River.
I think we have found one area of common ground (and it only took 4 days!).
We have been lied to about the horse racing industry (see my FIRST post). Let’s ask Annapolis to call this what it is, a pure cash grab.
I’ll drink to that!
And correct me if I’m wrong, I’ve yet to see a law enforcement officer making much of any profit at all. Or any teachers for that matter.
I was talking more about every voters moral responsibility to the consequences of their votes.
Ethics and morals and class aside, its a bill of goods we are being sold, and I’m tired of that. THIS slots movement in THIS state right now is a dirty pack of lies and fake promises that will get us nowhere.
Look at that! Common ground, again! SWEET!
Maybe, just MAYBE, there will be enough voter apathy again this year to defeat the referendum. Of course, it’ll probably be one of those deals where you have to vote FOR it to vote AGAINST it, or some other nonsense designed to baffle the great unwashed masses.
Postscript: Sitting through dinner last night, watched three “Charlestown Races and Slots” commercials. Catchy jingle.
“Horse Racing in Maryland, a $2 Billion Industry? Wanna bet?”
Maybe whoever researched this for our state government just made a typo. Perhaps it was to read: “$2 Million Industry”. The “B” and the “M” ARE very close on the keyboard.