Minutes of Public Meeting - February 16, 2016

In accordance with the Notice of Public Meeting, as required by State Government Article, §10-506, Annotated Code of Maryland, the Maryland Racing Commission ("Commission") met in open session on February 16, 2016 commencing at 12:30 p.m. at Laurel Park, Laurel, Maryland. Chairman McDaniel called the meeting to order and thanked everyone for attending.

Minutes – January 19, 2016.

The Commission waived a reading of the minutes of its January 19, 2016 meeting and voted unanimously to approve them.

Executive Session – January 19, 2016.

In January, the Commission held an Executive Session to deliberate for selecting one of the vendors who had responded to a “Request For Proposal” advertised by the Department of Labor, Licensing and Regulation for insurance broker services. The Commission waived a reading of the minutes of its January 19, 2016 Executive Session and voted unanimously to approve them.

Aspects of Wagering.

Chairman McDaniel commented that he would like to have an educational component to each meeting. He asked that the Commission be presented with an overview of a different area of interest from both the Thoroughbred and Standardbred industries. He noted this month, Tim Ritvo of the Maryland Jockey Club, would educate the Commission on several aspects of Advanced Deposit Wagering (ADW).

Tim Ritvo explained that ADW accounts for approximately $80,000,000.00 per year in handle. Mr. Ritvo further explained that the use of ADW’s benefits the racing industry, but requires a review on how revenue is distributed. Further, Mr. Ritvo explained that when ADW wagering is used by the betting public, less revenue is being shared by the track, horsemen and breeding industry as compared to when an individual makes wagers at a racetrack. Mr. Ritvo explained that even though the Stronach Group owns an ADW company (Xpressbet), the model on how revenues are divided requires an annual review. Mr. Ritvo also explained that “Off Shore Wagering” is a problem facing the racing industry.

Maryland Jockey Club – Satellite Simulcast Betting Permit.

Chairman John McDaniel reported that the Commission held a public meeting at the Maryland State Fair on February 11, 2016, to consider the application submitted by the Maryland Jockey Club to operate a Satellite Simulcast Betting facility at Timonium. At that meeting, attendance was large and was comprised of both opponents and supporters of the permit application. During the hearing, a number of issues were raised by the public, such as permitting, traffic, safety and health issues, zoning, the potential for a casino at the site and a lack of transparency. The meeting lasted for over two hours and everyone in attendance was given the opportunity to address the Commission, both in support and opposition.

After the public meeting, on February 12, 2016, the Executive Director was directed by the Commission to send a letter to the Maryland Jockey Club asking the Jockey Club to produce certain documents related to concerns raised at the meeting. William Marlow, representing the Maryland State Fair, commented that the State Fair was in the process of obtaining all final permits. Chairman McDaniel asked about the status of the asbestos issue raised at the public meeting. Mr. Marlow responded that a third party inspection would be performed, but it had not occurred by the time of the meeting. Chairman McDaniel asked the Maryland Jockey Club and the State Fair representatives regarding their position regarding casino style gambling at the location. Sal Sinatra on behalf of the Maryland Jockey Club and Bill Marlow on behalf of the State Fair both affirmatively stated that they would not make any efforts to have casino gaming at the facility. Finally, Chairman McDaniel had asked for a response to Councilman Kach’s claim that the site did not comply with local zoning laws. Mr. Marlow responded that the State Fair had a law firm reviewing the matter and would be providing an opinion shortly. David Thaler, representing the State Fair, explained the permitted uses of the facility were identified in the Mercantile Overlay zoning law, which included Satellite Simulcast Facilities under Title 11. Assistant Attorney General Eric London, counsel to the Maryland Racing Commission, opined that he had also reviewed the zoning issue and concluded that the use as a Satellite Simulcast Facility was appropriate under the current zoning law.

Chairman McDaniel commented that the Commission, with an abundance of caution, would not take a vote at the meeting, since there were documents to be received from the Maryland Jockey. Mr. McDaniel also commented that after the documents were received, there would not be a need for any further public comment, testimony or deliberation by the Commission, as the Commission had already conducted a public meeting on February 11, 2016, as well as allowed all Commission members to ask any questions at either of the two public forums. Further, Chairman McDaniel commented that the Commission would not unduly delay the vote and would vote by the end of the week, once the documents the Commission had requested were received. Alan Foreman, Counsel to the Maryland Thoroughbred Horsemen’s Association, requested the Commission to vote on the application, but making the vote contingent on receipt of the documents. Chairman McDaniel responded that there was no need to vote at the meeting, since there were still documents to be received. Chairman McDaniel made clear that the vote would be taken once the documents were received.

Maryland Jockey Club.

Tim Ritvo, representing the Maryland Jockey Club, explained that they had had a good visit with the Lieutenant Governor, who appreciated and supported all of the improvements being made at Laurel. Mr. Ritvo noted the second of two barns is close to being completed as well as new wash stalls. He also advised that dorm rooms are being repaired and noted there were plans for the construction of new dorms for the backstretch workers. Mr. Ritvo also explained that there are improvements to the tote systems, including a new board in the infield at Pimlico. Mr. Ritvo further advised that field size has increased from 7.65 to 8 horses per race. Mr. Ritvo stated that he believes with the synergy between the industry partners, he saw no reason why the industry would not continue to grow.

Mr. Ritvo also stated that he believed the Commission was treated unfairly at the public meeting, because the construction of the OTB was already underway before being approved. Mr. Ritvo went on to say that the Maryland Jockey Club is aware of the risks of not being approved by the Commission, but they want to be operational as soon as possible, should the Commission approve an OTB permit. Mr. Ritvo explained that if the Maryland Jockey Club did not receive the permit, it can easily move the televisions and machines to the next location.

Mr. Ritvo also commented that the live product at Laurel over the past weekend, for the first time, outperformed the Fairgrounds in Louisiana, noting that the Fairgrounds purses are 34% to 40 % higher than Maryland’s and they have turf racing.

Medication Review Committee.

The Executive Director reported that the committee was in its initial stages and Commissioner Tom Bowman was in the process of soliciting members. Commissioner Bowman commented that the outcome of the committee will have an impact on the industry and that he envisioned the committee focusing on transparency and education.

December VLT Report.

Executive Director J. Michael Hopkins presented the Commission members with the January VLT report.

Legislative Update.

The Executive Director provided the Commission members with an overview of all the legislation that had been introduced to date relating to the racing industry. With the exception of HB 727, the Commission took no position on the proposed legislation. Mr. Hopkins noted that HB 727 would be supported with amendments, bringing more clarity as to how residents and businesses would be made aware of a public meeting for an inter-track location.

Public Comment.

Cricket Goodall representing the Maryland Horse Breeders Association (MHBA) encouraged everyone to attend the Maryland Horse Industry Day in Annapolis on February 23rd, 2016 and that everyone could access the MHBA’s website for a more detailed agenda. Bill Reightler, a member of the audience, commented that the use of a public address system would help people hear the comments being made by the Commission.

Next Commission Meeting.

The next Commission meeting will be held on March 15, 2016 in the Clubhouse at Laurel Park, Laurel, MD 20725.

J. Michael Hopkins
Executive Director