Even after licensing deal, Churchill Downs CEO says ‘Maryland is in control’ of Preakness

The 151st Preakness Stakes will be run at Laurel Park in three weeks.

Beyond that, the outlook for Maryland’s signature thoroughbred race became a subject of renewed fascination this week after one of the most powerful companies in the sport unexpectedly stepped in to buy a stake.

With reports already swirling that a new television deal could push the Preakness to a later spot on the calendar, Churchill Downs Inc. further shook up the picture Tuesday, announcing it had agreed to acquire the intellectual property rights to the second jewel of the Triple Crown (and its sister race, the Black-Eyed Susan Stakes) from 1/ST Racing for $85 million.

Though Churchill is known primarily for operating the Kentucky Derby, the publicly traded Louisville-based company owns racetracks and gaming sites across the country, including Ocean Downs in Maryland. Its latest move to expand its footprint raises new questions about who will take stewardship of one of Baltimore’s most important events and about the configuration of the sport’s most visible showcase, the Triple Crown series.

Racing observers immediately speculated that with a stake in two of the three Triple Crown races, Churchill would push for a revamped schedule designed to give horses more recovery time and produce a more cohesive product.

Though many in Maryland would welcome such a change, Churchill’s presence complicates a carefully constructed narrative of sovereign control established when state officials negotiated a deal to take over Pimlico Race Course and lease the rights to the Preakness from 1/ST Racing.

Maryland officials say their future rights to operate the Preakness and negotiate new media deals around the race are unchanged by Churchill’s purchase. But they were caught off guard by the sale.

Maryland Jockey Club president Bill Knauf said Wednesday he had yet to speak with Churchill representatives about their plans, though he reiterated that there’s no room in the exclusive licensing agreement for Churchill to move the Preakness or negotiate a new broadcast deal for the race.

Asked if he thinks Churchill can help build the event, Knauf replied: “It’s a little early to tell, but obviously, Churchill is a well-established company, and the Derby is a tremendous event. How it’s integrated or used with us is still left to be determined.”

A spokesperson for Gov. Wes Moore deferred a request for comment to the Maryland Stadium Authority, which is redeveloping Pimlico and building a new thoroughbred training center at Laurel Park.

“For Marylanders and racing fans, it is important to note that the announcement of the intended transfer of the intellectual property for the Preakness Stakes to Churchill Downs has no effect on the Redevelopment of the Pimlico Race Facility and New Training Center projects nor the long-term future of the Preakness Stakes in Maryland,” said Rachelina Bonacci, the authority’s spokesperson, in a statement.

For their part, Churchill officials have said that Maryland will remain in the driver’s seat.

Churchill CEO Bill Carstanjen was asked on an earnings conference call Thursday morning if he sees the Preakness as “something you can start to transform and redevelop near-term?”

“Maryland is in control of the destiny of the Preakness,” Carstanjen replied. “They have the land. They’ve authorized, legislatively, $400 million in bond funds to invest in the property. … They are in control of that investment. We certainly, upon closure, will be the owners of the intellectual property and have started, already, a very strong dialogue with the state about how we may be able to help them achieve those goals.”

He added that those discussions are “in the early stages” and that “this is something the state will have to ask for our help for.”

Why did Churchill want a piece of the Preakness?

“It’s in our view an iconic asset, and, having been in the game for a long time, I’m familiar with the history of the Preakness,” Carstanjen said. “I know what it’s been in the past and what it can be in the future. So we’re happy to participate and work with the state as they see fit to help them build them back to their former glory.”

But if the intellectual property rights were for sale and Maryland wanted full control of its big event, why didn’t the state simply buy out its agreement with 1/ST Racing?

It’s not clear whether the possibility was broached before 1/ST reached its agreement with Churchill. A source with knowledge of the original licensing deal that the state struck in June 2024 said the intellectual property for the race was not for sale at that time.

Under the deal the state reached to take over daily operations of thoroughbred racing at the beginning of 2025, the newly formed nonprofit Maryland Jockey Club planned to pay 1/ST Racing about $5-6 million annually for the right to operate the Preakness starting in 2027. The plan was for 1/ST Racing to play no role in putting on Maryland’s signature race.

Churchill will take over that deal, but will it be the passive partner 1/ST Racing was presumed to be?

Carstanjen hinted at a more active role when he said he envisions Churchill becoming “a participant in all things racing in the state of Maryland.”

News of the Preakness sale came one day after the Maryland Stadium Authority purchased Laurel Park from 1/ST Racing for $48.5 million, with plans to turn it into a revamped training headquarters. The twin moves will close out the Stronach family’s run atop the state’s racing industry, which began in 2002, when Frank Stronach’s Magna Entertainment Corp. purchased a majority share in the Maryland Jockey Club.

The Preakness changed drastically under the Stronachs’ watch, with crowds and profits dwindling in recent years and traditionalists grumbling that high-priced concerts overshadowed the race itself. The quality of fields also came under scrutiny, with modern trainers increasingly reluctant to run their star horses just two weeks after the Kentucky Derby. Last May, trainer Bill Mott opted against bringing Derby winner Sovereignty to Baltimore, a skip that took on more significance when Sovereignty went on to win the Belmont Stakes.

Though some trainers, fans and historians say the Triple Crown calendar — three grueling races in five weeks — should remain unchanged to preserve the difficulty of the feat, many others say a change, to accommodate modern training practices, is long overdue.

Earlier this month, Sports Business Journal reported that the Preakness could be pushed back a week as part of a new television deal with NBC, which currently broadcasts the race, or Fox, which broadcasts the Belmont Stakes. But New York racing officials have shown little inclination to bump the Belmont back to create a six-week Triple Crown. Will Churchill have the power to push that discussion forward?

“Obviously, they have a long-term deal with NBC, so nothing’s out of the question,” Knauf said. “But we are also doing our own diligence and have already started the process. So we’ll continue moving forward.”

He expects a new television deal for the Preakness and Black-Eyed Susan to be announced in about a month.

It’s another major question that looms at the dawn of a new era for the Preakness, which will be run at Laurel Park on May 16 as the Maryland Stadium Authority moves forward on rebuilding the race’s traditional home at Pimlico.

In discussing the Preakness on his earnings call, Carstanjen alluded to the event’s struggles. It has lost money in recent years, and with attendance capped at 4,800, this year’s edition will bear little resemblance to the populist spectacles that used to be a Baltimore rite of spring. Maryland officials hope the race will be back at Pimlico in 2027, with new management (1/ST racing is still in charge of the event this year) aiming to recapture its former glory and profitability.

Churchill has financial incentive to aid in that effort, because it will receive 2% of the betting handle for Black-Eyed Susan and Preakness days as part of its licensing deal.

“We think it has tremendous potential, a tremendous history, and as it unfolds, we are certainly available to the state and happy to work with the state to help them figure out how best to transition that property into something great like it’s been in the past,” Carstanjen said.

“For us, it’s entirely consistent with how we look at things like the Derby. In my opinion, the Derby is always what’s most special about our company and what’s most unique about our company. It’s an asset that can’t be duplicated, just a very special, unique piece of Americana. And we think Pimlico and the Preakness has elements to that itself. It’s about developing those.”