Maryland Thoroughbred Racetrack Authority Audit Report: Financial Deficiencies and Oversight Concerns
The Maryland Thoroughbred Racetrack Operating Authority, which was established to oversee the redevelopment of Pimlico Race Course and thoroughbred racing in the state, failed to finalize a $10 million working capital agreement and ensure competitive bidding for consulting contracts. The Office of Legislative Audits released a report highlighting significant deficiencies in the board's operations that could impact financial records and compliance with laws and regulations. The authority was created in 2023 to preserve horse racing in Maryland and revitalize Pimlico to prevent the Preakness Stakes from leaving Baltimore.
The 13-member authority was tasked with creating a top-tier racing venue and consolidating thoroughbred racing in the state. It established the nonprofit Maryland Jockey Club to manage daily racing operations and oversee the licensing of the Preakness and related races. Earlier this year, lawmakers raised concerns about the authority's operations, leading to the dissolution of the authority and the transfer of responsibilities to the Maryland Stadium Authority and Maryland Economic Development Corp. The redevelopment of Pimlico is now in progress under the new structure.
The legislative audit revealed issues with the authority providing state funds to the jockey club and hiring consultants without proper agreements. Auditors found that the authority did not formalize a written agreement for a $10 million working capital advance with the jockey club, raising oversight concerns over the redevelopment funds. Additionally, five consulting contracts totaling $1.9 million lacked clearly defined deliverables and deadlines, leading to uncertainties about the services provided and invoices paid.
The governor's office acknowledged many of the audit findings but disputed the characterization of the $10 million working capital as a loan. The office stated that the law did not specify the working capital as a loan and that the authority did not finalize repayment terms. Auditors stood by their description of the working capital as a loan based on the draft agreement and information provided by the authority. The audit report highlighted the need for improved oversight and transparency in the authority's financial transactions and contracting processes.
In conclusion, the audit report on the Maryland Thoroughbred Racetrack Operating Authority identified significant deficiencies in financial management and compliance with laws and regulations. The authority's failure to formalize agreements for working capital and consulting contracts raised concerns about oversight and transparency in the redevelopment of Pimlico Race Course. The restructuring of racing and redevelopment efforts aims to address these issues and ensure the long-term sustainability of horse racing in Maryland.