Posted: 7:48 pm Wed, June 16, 2010
By Liz Farmer
Daily Record Business Writer
In the wake of Rosecroft Raceway’s announcement that it will be closing July 1, supporters of the Fort Washington harness racing track are pointing fingers at Annapolis.
“They talk about ‘jobs, jobs, jobs,’ and when the Preakness and Pimlico were in trouble, the governor and others ran downstairs to save them,” Sen. C. Anthony Muse, D-Prince George’s, said Wednesday, referring to swift legislative action last year that protected the property and the state’s first right of refusal to the race.
“Here we have 200 jobs on the line and they have done absolutely nothing,” he said.
Kelley Rogers, president of Cloverleaf Enterprises Inc., which owns the race track that declared bankruptcy a year ago, said it was no longer financially viable to keep Rosecroft open.
“It just makes me sick. It really does,” he said. “The Legislature sat on their butt and didn’t do anything to save these jobs.”
Requests for comment from Gov. Martin O’Malley did not receive a response.
With the demise of Rosecroft, Ocean Downs on the Eastern Shore will be the sole harness track in Maryland. Built in 1949, Rosecroft is Maryland’s oldest harness track.
Cloverleaf will convert from Chapter 11 bankruptcy to Chapter 7 and auction the race track. Rogers said he notified the track’s 200 employees Tuesday about the layoffs. Although about half are full-time union workers, he said Rosecroft did not have enough money to offer them severance packages.
Thomas Cooke, president of the Cloverleaf Standardbred Owners’ Association, spent Wednesday at the track talking with employees and saying prayers.
‘Very, very depressed’
“The mood here is very, very depressed,” he said. “You’ve had people who have worked here for 35 years — it’s the only job they’ve ever had.”
Supporters said legislation in this year’s General Assembly session that could have brought poker rooms to Rosecroft would have made keeping the track open financially worthwhile. The bill, SB 1035, would have authorized a referendum in Prince George’s County on legalizing poker at Rosecroft. Muse and Senate President Thomas V. Mike Miller, D-Calvert and Prince George’s, sponsored the measure.
According to a feasibility study commissioned this year by Greenbelt-based developer Mark Vogel, who had stepped forward to buy the track, gaming revenue at Rosecroft could have totaled up to $42 million per year for the county and state, and produced up to 1,500 union jobs.
The bill passed the Senate but died in a House committee.
“You have 200 jobs in an African-American community and nobody gives a damn,” said Rogers.
While harness racing has been on the decline in Maryland, that hasn’t been true in other states, according to Ellen Harvey, harness racing communications director for the U.S. Trotting Association. The sport in Maryland reached its peak in the 1980s with three tracks — Rosecroft, Ocean Downs and Freestate Raceway in Laurel. Freestate closed in 1990, and a CarMax sits on the site.
Harvey said there are about 40 harness racing tracks across the country, a number she said has not fluctuated greatly over the years. But the difference between successful tracks and struggling ones like Rosecroft often lies in the state’s legislative policies.
Different in Pa.
“Certainly things in Maryland are very different than they are across the border in Pennsylvania, where there’s a legislative framework that exists that allows those tracks to thrive,” she said, noting that the three harness tracks in Pennsylvania, like the two thoroughbred ones, offer alternative gaming.
In Maryland, slots were approved by a voter referendum in 2008 and limited to five locations across the state, including Ocean Downs. In Anne Arundel County, a court case is tying up whether slots might be installed at Laurel Park or near the Arundel Mills mall.
“Other states are thriving and blossoming and doing very, very well, and they’re all around Maryland,” said Harvey.
Over the last year it appeared as if Rosecroft might recover from its slump after it stopped live racing in 2008 and essentially was operating as an off-track betting facility. Vogel had pledged to reinstate live racing, and in April loaned the track money to keep it operational through June.
Vogel said Wednesday the track was losing too much money for him to keep investing.
“I never thought it would come to this,” he said.
According to its last financial statement, Rosecroft reported a net operating loss of $154,000 through the first four months of the year. The track also said expenses not related to its operations put it at a net loss of $478,000 for the year.
Vogel said his decision was also affected by an ongoing dispute with the state’s thoroughbred industry, meaning Rosecroft has no significant means of income in the near future.
The Maryland Racing Commission voted last year to shut off the track’s simulcast signal of thoroughbred racing because Cloverleaf refused to pay the Maryland Jockey Club a rights fee of $5.9 million per year. Rosecroft officials said the deal had become unfair because its annual handle had dropped from $110 million when the 2006 deal was struck to half that amount in 2009.
$10M to keep track alive
Cooke, the standardbred owners’ association president, said he was hoping to find investors willing to keep the track alive and is pledging $2 million himself. But he said it would take roughly $10 million to get the track through bankruptcy and “it’s not looking good so far.”
Cooke said he is saddened by the state’s lack of response.
As a lifelong Democrat, I am so disappointed in the administration of Gov. Martin O’Malley,” he said. He noted that at last year’s Maryland Horse Forum, in which O’Malley was the keynote speaker, the governor had talked about going to Rosecroft as a kid.
“As far as I know that’s the last time he’s mentioned Rosecroft,” he said.