Governor signs Pimlico legislation
Maryland Gov. Martin O'Malley on Tuesday signed legislation giving the state the authority to purchase the Preakness Stakes and other Maryland horse racing assets of its bankrupt owner - by eminent domain, if necessary.
O'Malley signed the bill one day after the state's house of delegates voted 93-43 to approve the legislation in the final day of the 2009 session. The state's senate had passed the bill on Saturday.
The governor and Democratic leaders in Annapolis say the state needs broad powers to ensure that the second jewel of the Triple Crown continues running at Pimlico Race Course. The track's owner, Magna Entertainment Corp., wants to auction off its Maryland assets - including Pimlico Race Course and Laurel Park - under federal bankruptcy proceedings.
Lawmakers passed O'Malley's bill over the warnings of Republicans who said the move threatened private-property rights. If Maryland wants to buy Pimlico and keep running the Preakness, it should compete in the marketplace with other bidders, Republican critics said.
Officials from the governor's office and attorneys for the state have said the state may participate in a court-supervised bankruptcy auction that is anticipated this summer. The bill authorizes the Maryland Economic Development Corp. to finance a purchase by issuing bonds.
Magna officials and their attorneys have criticized the eminent domain bill. A New York bankruptcy attorney for the Canadian company told Maryland officials that any attempt to exercise eminent domain powers would violate federal bankruptcy code.