DLS flags Preakness deficiency and recommends shrinking major events fund as stadium authority defends investments

A Department of Legislative Services (DLS) analysis presented to the House Appropriations Education and Economic Development Subcommittee recommended against an operating deficiency for a Preakness‑related appropriation and proposed reductions to the Major Sports and Events Entertainment Fund, while the Maryland Stadium Authority (MSA) and sports industry witnesses defended the state’s event investments as economic development.

Patrick Frank, DLS budget analyst, told the subcommittee there is a $1,500,000 deficiency in the Maryland Stadium Authority’s proposed budget to support a Preakness 150th anniversary initiative. Frank cautioned the committee that capital funds already appropriated for Pimlico improvements cannot be redirected without separate legislation and said DLS does “point out that there’s quite a lot of money available for this.” He also summarized the agency’s core functions—operations of Camden Yards and other venues, construction and financing for school projects and other public works, and administration of event grants.

Frank reviewed the Built to Learn program’s bond issuances and capacity, reporting that $1,100,000,000 has already been issued for the program, with an annual debt service limit of $100,000,000 of which $64,400,000 is currently used. He noted rising true interest costs on recent sales—2.8% in 2021, 3.2% in 2022 and about 4.3% at the most recent sale—and that future program capacity depends on market rates (DLS’s forward analysis put total potential program proceeds in the $1.6–$1.7 billion range under current rate assumptions).

Frank also criticized the Major Sports and Events Entertainment Fund’s structure, which provides $10,000,000 annually with a mid‑year replenishment mechanism, saying the program could be reduced. “Our recommendation…is that we reduce the amount to $5,000,000 starting in 2027, and then remove the replenishment,” Frank said, though he also discussed alternative reductions and portfolio approaches in testimony. Frank recommended a separate $250,000 reduction in stadium debt service as an efficiency adjustment.

Maryland Stadium Authority witnesses defended the funding. Dawn Abshire, MSA chief financial officer, said the authority needs the $59.5 million cushion to manage uncertain variable debt on stadium financing: “We need that couch cushion money…to ensure that if the interest rates fluctuate on that series we have enough to cover it.”

Terry Hasseltine, executive director of the Maryland Sports Commission, described economic impacts from funded events and argued the grants are leveraged with private sponsorships and ticket revenue. Hasseltine said no event receives 100% state funding and cited the Fair Hill event and the Preakness festival planning, asserting the program makes Maryland more competitive for sports tourism. He provided impact figures for a recent event—$11.6 million in direct spending and 17,000 room nights in Maryland over four days—and framed event grants as longer‑term investments in economic activity.

Stakeholders from the sports and tourism sector urged the subcommittee not to cut the program. Matt Liber, executive director of the Maryland SoccerPlex and a national sports tourism trade association vice chair, warned that reductions would weaken Maryland’s competitiveness for major events and highlighted statewide tourism figures: 45.1 million visitors and $20.1 billion in visitor spending, producing $2.4 billion in tax revenue.

Frank also described an Oriole Park financing that used a private placement on a 15‑year structure tied to the current lease term; he suggested the structure makes future consolidation with a broader financing easier if a new agreement is negotiated, and noted the shorter term reflects lease length to avoid paying for a team that might depart before bond maturity.

Committee members asked about local business participation in stadium operations; MSA representatives said lease terms with teams generally govern operations and that the Ravens and Baltimore Convention Center emphasize minority or local spend in construction and procurement where applicable.

No formal votes were taken; the presentation will be part of the committee’s broader FY26 budget deliberations.