May 16, 2009

Seven Reasons This Is Maryland's Last Preakness

Preakness Day in Baltimore is a huge event for Maryland, but today might mark its last running in the Old Line State. A confluence of factors seem poised to finally push the second jewel of the Triple Crown to another venue.

1) No Beer, No Fans. The Preakness infield had one policy prior to this year that was a bigger draw than any entertainment they could put on the track or on a stage. You could bring in as much beer as you could carry. As one can imagine, this made for a one-day Mardi Gras. Baltimore draws from a huge college population, reaching University of Maryland, Johns Hopkins University, University of Delaware, Penn State University, and smaller colleges like Towson and UMBC. The infield was a breast-baring, bare-knuckled brawling, beer-hurling orgy of inappropriate youthful behavior. The fans one-upped themselves year-after-year, until they finally went a little too far. The running of the porta potties made it apparent that maybe people were bringing a little more beer than they needed.

2) God's Wrath. The weather in the mid-Atlantic in mid-May is completely unpredictable. The temperature can range from 50 to 90 and the chance of soaking rain is relatively high. This year brings a high of 77F with an 80% chance of rain and a high likelihood of strong to severe thunderstorms. Considering many if not most infield tickets are bought at the gate, bad weather is a huge deterrent. Do not forget that the race day runs from noon to about 7:30 p.m. That's a long time to spend soaked.

3) Ownership Bankrupt. Magna Corporation filed for Chapter 11 bankruptcy earlier this year. Originally Pimlico, Laurel Park and the Preakness itself were to be sold off, but Magna succumbed to pressure from Baltimore and the State of Maryland, and withdrew those assets. Their current plan includes Santa Anita and three lesser tracks. There are plenty of tracks that would love to have the Preakness, like Arlington Park (which made a bid in the past), and an auction of the second jewel of the Triple Crown would attract more out-of-state attention than in-state.

blahbblahblahlahblah Ladies and gentlemen....Buckcherry!

4) No Triple Crown. The Preakness' greatest asset is that there is almost always a Triple Crown still possible. When Calvin Borel steered Mine That Bird through 18 other horses to don the roses, America cheered the underdog while the Maryland Jockey Club cried into their stirrups. No one believes he can win the Triple Crown. His own jockey opted to ride the filly, Rachel Alexandra, that destroyed her competition in the Kentucky Oaks the day before the Derby. No Triple Crown means attendance drops, TV ratings drop, and the betting handle drops.

5) Bad Economy. This one speaks for itself. Corporate boxes go unfilled. People cannot gamble as much. The upfront costs of attendance retards last-second attendance.

6) No Slots. Maryland approved slot machine gambling by referendum last November, but Pimlico is not one of the approved venues. Nearby Delaware Park and Charles Town (West Virginia) have slots, and have taken a lot of the quality racing, trainers, and jockeys with them. Slot revenue allows for bigger purses. Pimlico's weekly cards are filled with $5000 claiming races, maiden clunkers, and otherwise horrible racing.

7) ZZ Top and Buckcherry. Yup. That's what the authorities decided would replace the draw of all-you-can-drink beer. Is there ANY overlap in this fanbase?

Considering the shortfall in revenue from this year's Preakness, I just can't see the race surviving another year in the State.

Read the Baltimore Sun's take on Pimlico's fate here.

20 Responses:

Anonymous said...

Why don't black people go to Preakness?

Ed James said...

Good try but you failed.

The Preakness doesnt need 10,00 drunk idiots because they werent making any money off of them

Today, there was $22 million bet straight on the race compared to $14 million last year. So the handle was way up.

Not to mention, the presence of a filly and the likeable Derby winner probably meant good ratings.

But I have to give you made me laugh. Its so cute when bloggers try to act like they know everything, especially about a sport that you clearly know nothing about.

Yes, I'm sure Buckcherry & ZZ Top are going to topple a 100+ year tradition. A million LOLs to you sir.

Anonymous said...

Ed, you need your own blog (if you don't already have one.)

Someone just got f'ed up with some truth!

Anonymous said...

You forgot Loyola College...lots of drunks from LC at Preakness!!!!

Gibbon Jockey said...

@ the Critics

You attack without understanding. Buckcherry and No Coolers is irrelevant.

The most important points are:

a) Magna is bankrupt. They WILL sell the Preakness to CDI because they need the money.

b) No slots, no purses. Until Maryland gets it in its head that the purses are necessary to support a legitimate spring meet, the day-to-day handle will fall. That's the real measure of a track's viability - not some one-of bump because grrl power caught wind of a superfilly.

You just watched the last Preakness at Pimlico.

J-Red said...

2008 total Preakness handle was $45 million according to At-track handle was $6.2M.

2009 total Preakness handle was $58.7M according to Equibase.

The Maryland Annotated Code, Business Regulations article, section 11-515 gives the track itself 7.7% of the WPS pool, 8.7% of the exacta pool, and 11.7% of the trifecta/super pool. The remainder of the takeout goes to the State and other pension and purse set-asides. (Maryland's takeout is 18% from WPS, 21% exacta and 25% trifecta/super (See Md. Code Ann., Business Regulation s.11-514.))

Again using the Equibase numbers from today, the track made $5,548,676 that it can keep on the Preakness itself today. Assuming the allocation between WPS and exotics was the same last year, the track made $1.295M more this year off the handle.

At $45/infield ticket, 50,000 fans is $2.250M. Also, fans who aren't there buy NO concessions, NO programs, NO Black-Eyed Susan commemorative glasses, and you fucking paid Buckcherry and ZZ Top, and you had CNN, NBC, CNNSI, and ESPN commenting on how the infield was empty.

You, Ed James, are a total fucking moron. Despite the better handle (which has more to do with 2008 being a down year because of 1-5 Big Brown than anything else), the track lost seven figures year-to-year today. The corporation that owns the track, Magna Entertainment, is ALREADY bankrupt.

This isn't Bill O'Reilly or Jim Rome. Here I can crack back on your stupid ass.

J-Red said...

Oh, and my 2008 handle estimate is likely an underestimate since 1-5 Big Brown made the exotics more popular.

Ed James, I assume you'll struggle with the math. Feel free to e-mail [email protected] and I'll take you back to 3rd grade.

Brien said...

nice comeback j-red. the other point is that a corporate owner can get the same handle for the race at any track. the difference is between 120,000 poeople in the infield and 50,000. i'm very interested in seeing the attendance numbers this year

Ed James said...

Total amount bet on the 2008 Preakness: $71.1 million.

Total amount bet on the 2009 Preakness: $84 million.

Go to the the Daily Racing Form and look those up. Thats a 19% increase.

You also discounted the fact that the people that did show all had to buy beer this year at $3.50 a pop. So the loss of ticket sales was subsidized (im sorry, is that word too big for you?) by the increase in alcohol sales over last year.

Attendance in horse racing means nothing, especially if its 50,000 people who arent gambling. That $2 million was easily made up at the windows and they can now market the infield as family-friendly, to get more people who were previously afriad to show up, have a reasonable party and actually bet.

Have you ever been to the Preakness? Because I have and been to the infield. It was always a fun party scene but had devolved into a drunken white trash frat party that served no purpose to Pimiclo's bottome line. Hell, they may now save money in the future with less security guards, cleanup crews and off-duty cops who have to work the event.

Not to mention that if you paid attention to the news, you would know that the Maryland legislature passed an eminent domain bill this past week to seize Pimilco and the Preakness if Magna failed. And the government is trying to find a new buyer to take the asset off of Magna's hand.

But yes, I'm sure that the fact that drunk frat boys didnt buy programs and souvenir cups is going to drive the race into the ground.

Are you serious dude? And I didn't send an email because I want everyone here to read how stupid you are. Just admit that you wrote a bullshit blog post based on ZERO facts, got too much publicity and now you're getting smacked down to where you belong.

The only argument you had, which another commentator made, is about slot machines and the overall decline in Maryland racing, which is an issue. But with the eminent domain legislation, the government has taken the stand to make sure the event stays in Pimilco.

This is what I call using facts to make an argument. Its actually very easy these days. You could have just typed "preakness" into google news. Or just went to the Baltimore Sun website, which had been updating the situationa all week.

Because you seem like such a tough guy behind that computer...Im sorry if I hurt your feelings. Its ok, every now and then, we all try to be big and tough and smart. But when we lack the mental acumen to do so, we just end up embarassing ourselves.

+2 for effort, -100000 for the execution.

See you next year in Baltimore for the Preakness!

Ed James said...

I forgot to cite my source:

Youll noticed the day's card was up 19% while the Preakness race was up 29%.

Because there's a lot of words in that blog, here are the money quotes from Steve Crist (he's a horse racing writer and about a gajillion times more qualified to speak about this.)

"6:00 pm: There's already over $18 million in the win-place-show pools for the Preakness, compared to $14.3 million last year. Makes you wonder how much those missing infield revelers ever really bet."

"The pick-4 ending with the Preakness handled $1.99 million vs. $1.39 million last year. In total, the Preakness Day handle was up a rousing 19 percent from last year, from $71.1 million to $84.3 million."

Yes, Im sure Maryland racing officials are crying this morning because there arent any youtube videos of guys running along urinals.

J-Red said...

The eminent domain is a false threat. Here's the thing about eminent domain - the State takes ownership. We are broke. The General Assembly isn't going to take on a guaranteed money-losing proposition.

Plus, if the State did take ownership of the tracks and the Preakness, they'd have to run it too. I'd like to see the Republicans endorse a guaranteed deficit while the Democrats endorse state-sanctioned extraction of money from poor Baltimoreans. And as someone who has spent a lot of time at Pimlico and Laurel I can say with certainty that 95% of the crowd there can't afford to be losing any money.

As for the contention that the sale of $3.50 beers made up in any way for the severe drop off in infield attendance, I'll present some more basic math.

The clubhouse and grandstand in Preakness configuration "seats" 35,000 people. Let's up it to 50,000 and respect the 60,000 stated infield capacity, since the 2008 crowd was measured at 112,000.

If this year's attendance total is 60,000, which is a reasonable estimate based on what I saw and on Brien's photos, the infield attendance was between 10,000 and 25,000. To make up the 50,000 tickets at $45 a pop, even assuming the 50,000 drop-off bought no food, water or merchandise and didn't bet a penny, each of the max 25,000 in the infield today would have had to buy 25.7 beers each to make up for the lost gate. Factor in the increased handle, and those 25,000 people (and, again, that's the absolute maximum that could have been in the infield today) would have had to consume 10.9 beers EACH.

Since the people who did show up to the infield today are likely the people who were previously turned off by the frat boys and the flying beers, we can pretty safely assume they weren't packing 11 beers each.

The ball's in your court. Taking on a horseplaying lawyer with a math and science background in a discussion on math and public policy is probably foolish though.

J-Red said...

Good news! Announced attendance reported in Thoroughbred Times as 77,850, down 34,372 from 112,222 last year.

34,372 at $45 per ticket means that the 27,850 (again assuming Pimlico actually can seat more than the stated non-infield max of 35,000) only had to consume 3 beers each to break even! Realistically the figure is more, but we're giving you the best case scenario since we don't have all the facts yet.

Great news for your argument, again assuming none of the 34,372 in attendance last year would have bought any food, water, programs, or $9 Black-Eyed Susans.

Since it's immeasurable and we're only talking about the track's financial health, I'm ignoring that those 34,372 would have paid neighborhood families and charities $10 to $20 each to park.

J-Red said...

And, as Brien noted, the handle being up significantly this year is a good sign for horse racing, not for Maryland horse racing. Besides the fact it obviously would have been higher with 112,000 people (along with the other figures I mentioned like gate, merchandise and concessions), the handle would have been higher no matter where the race was run.

That's good news for horse racing. It doesn't make Pimlico or the Preakness (which is run, of course, at Pimlico) any more viable. Breaking even, which is the best case scenario for your argument, is a big fat loss when you're already in Chapter 11.

Sad Fans said...

That sucks about the BYOB. I was looking forward to more urinal runs on break monday morning

"ben" said...

In case Ed James makes a return (I'm guessing he won't):

You seem to be new here. J-Red says stupid, outlandish crap in order to (successfully) incite outrage. However, that doesn't mean you can automatically discount what he says. Maybe the final conclusion is stupid (maybe it isn't) but I'm sure the main points are based in fact.

Glenn Craven said...

Rather a lot of vitriol here.

Most of these seven reasons are either debatable or debunkable, particularly the bit about the weather. What ... are they going to move the Preakness to a one-day event at Del Mar? Doesn't nearly every state in the country have the saying, "Don't like the weather here? Wait a few minutes and it'll change."

As for the "10,000 drunk idiots," I suggest you think about that again, Ed. It ended up being closer to 25,000 "drunk idiots," who do buy expensive tickets, do buy programs and souvenirs and non-alcoholic concessions, and (as someone else noted) do pay to park in the neighborhood. I doubt the attendance will pick up all that much as people "get used to it," as Pimlico's president has suggested.

The Preakness was sort of the "Triple Crown race for the people" because of its reputation as "The Freakness." The no-outside-beverages edict likely cost Pimlico millions in on-track revenues.

Advance infield tickets were $45; day-of-race $60. Average that to $52.50 and multiply it by an attendance shortage (compared to the last 20 years' history) of about 25,000 and you have $1,312,500 in potential lost ticket sales -- on what usually is, arguably anyway, Pimlico's only truly profitable date of the season. ... That doesn't take into consideration any other money these roughly 25,000 people spend on-track and in the neighborhood (or throughout Baltimore) on Preakness Day.

Yes, the handle was up. But reports its handle on the Preakness was up 75 percent over 2007, when that service handled $2.1 million by itself; was shut out of Preakness wagering last year. And the handle was down more than 15 percent last year vs. 2007, so coming back up 17.9 percent in 2009 over 2008 (per Thoroughbred Times) really only gets the handle back up to recent historic levels.

From 2004-2007, the handle was over $87 million annually and in 2009, it almost, but not quite, got back to that mark. And absolutely no thanks to the infield alcohol decision, considering the drunks were there in the infield when the top four Preakness handle marks in history were set between 2004 and 2007.

Total handle was driven by a 50-1 Derby winner whose jockey opted-off to ride a filly trying to make history at Pimlico. Same reason TV viewership was up 24 percent. Total handle (or even on-track handle) is not remotely a vindication of the no-external-alcohol policy. Rather, Pimlico got lucky to have the "gender war" angle this year or handle perhaps wouldn't have rebounded much at all from a very sour 2008, especially considering the recession.

El Angelo said...

2008's handle is a horrible comparison, because handle was aberrently down last year. This year's handle is roughly in line with all years prior. So yeah, I suppose that means that the 35,000 people in the infield that didn't show up this year bet little or nothing, but that's still ~$2 million in other income they cost the track. But hey, nobody ever said MD racing was run intelligently.

J-Red said...

Glenn, I mentioned the weather only as an additional reason that THIS would be Maryland's last Preakness. Nobody can control it, but when everyone is on the ropes as it is some bad weather luck can push it over the edge.

While it didn't rain until right before the Preakness itself, the forecast probably kept a significant number of people home.

Ed James said...

TV ratings were the highest since 2004, 2nd highest in 20+ years.

But, but, but...this site told me that ratings would be down!

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