Senate panel OKs eminent domain bill for Preakness

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By Michael Drost

A Maryland Senate budget panel approved a bill Thursday that will give Gov. Martin O'Malley the authority to assert eminent domain in an effort to keep horse racing's Preakness Stakes in Baltimore.

The Senate Budget and Taxation Committee voted 11-4 in favor of the legislation, which will allow the state to either purchase or exercise eminent domain over the rights to the Preakness and the race track on which it is run, the Pimlico Race Course. The bill would also extend the state's eminent domain authority over Laurel Park and the Bowie Race Course Training Center.

Mr. O'Malley, a Democrat, introduced the emergency measure on Wednesday in order to downplay concerns that the race, the second leg in the fabled Triple Crown, may be moved to another state by its owner, Toronto-based Magna Entertainment Corporation, which filed for bankruptcy last month.

Mr. O'Malley's top aides said Wednesday that if the measure was not adopted, the next Preakness race - set for May 16 - may be the last one to take place in Maryland.

"We're addressing a very real and immediate problem. We don't want to be in a position where we have to say we acted too late or we waited too long," said Joseph Bryce, Mr. O'Malley top legislative aide.

Mr. O'Malley has been hard pressed to prevent the relocation of the Preakness, which draws about 100,000 spectators and generates enough revenue to support the state's entire thoroughbred industry each year.

The General Assembly must act quickly if it expects to get the bill passed in time, needing approval in the full Senate and approval in the House before lawmakers adjourn on Monday.

But concerns remain as to the whether eminent domain could be utilized because of Magna's bankruptcy status. Federal law prohibits a state from using eminent domain to seize the assets of a bankrupt company.

"Potentially we're spending time to debate a bill that we might not even be able to use," said Sen. Allan H. Kittleman, Carroll Republican.

Attorneys for the state say Magna has not recognized Maryland's interest in keeping the Preakness. The state already has a law giving it the right to purchase the Preakness in the event the race is put up for sale, but it remains to be seen whether that law would stand up to a legal challenge.

Gregory Cross, a bankruptcy attorney hired by the state, said the bill to authorize eminent domain would not allow the state to supercede federal law, but it would give the state the ability to ask a judge to grant an eminent domain request.

"We would have powerful arguments as to why that permission should be granted. But without the legislation we wouldn't even be able to seek that permission," said Mr. Cross.

Some lawmakers on the budget committee were concerned over the scope of the bill and whether the assembly was moving too quickly.

Sen. Rona E. Kramer, Montgomery Democrat, said that the state should first have a clear idea of how much the legislation will cost before it decides either way.

"I just think it would be extremely irresponsible for us to purchase these assets and not have any idea of how much we will recoup," she said.

Magna estimates the value of Pimlico Race Course at a total of $17.7 million. Laurel Park is valued at $42.4 million.

Sen. David R. Brinkley, Frederick Republican and a co-sponsor of the bill, had misgivings over the way the bill had been rushed through the legislative process.

"We've only heard testimony from one side. We don't do that often. We have time to get all this sorted out, we should use it," he said.

A House of Delegates committee has scheduled a "work group" on the bill for Friday morning.