Montgomery Parks says the failure of the Potomac Horse Center’s owner to address years of deteriorating conditions, estimated to cost millions of dollars to repair, is at the heart of failed lease negotiations that have led to the upcoming closure of the North Potomac facility.
The department identified significant “life safety concerns” caused by the property’s worsening infrastructure during a site assessment of the Potomac Horse Center (PHC) last year, Maryland-National Capitol Park and Planning Commission (M-NCPPC) Deputy Director Gary Burnett told Moco360 last week. The commission serving Mongomery and Prince George’s counties includes Montgomery Parks and the county planning department.
The terms of the horse center’s lease specify that the tenant of the property is responsible for maintaining the site’s infrastructure and covering all related costs, Burnett said.
“We were to a point where things were not happening, things were not occurring as they should have,” Burnett said. “This has been a long-term lease and so to make sure that we don’t continue to have the property continue to deteriorate, we needed to make sure [PHC was] following through with the terms of the lease as they were written.”
Montgomery Parks plans to assume stewardship of the facility when the business closes its doors in July 22 after the failure of lease negotiations with the center’s owner, according to parks officials.
PHC President Nancy Novograd announced April 30 that the center would close because it was unable to renegotiate its lease at 14211 Quince Orchard Road with the parks department.
“Since 2017, PHC has tried to renegotiate its 1993 lease with the Maryland-National Capital Parks and Planning Commission (M-NCPPC),” Novograd wrote in a statement. “The tipping point in the negotiations was M-NCPPC’s insistence that the renewal of the lease was contingent on PHC raising three to five million dollars to improve M-NCPPC’s infrastructure with no assurances that PHC would be permitted to remain on the property.”
In her statement, Novograd described the infrastructure at the horse center’s facility as “rapidly deteriorating.” She said PHC plans to sell its horses and daily use equipment after the facility concludes lessons June 16. All other assets were available for purchase starting April 30.
Burnett said Montgomery Parks provided the horse center “with a path forward to talking about negotiating a new lease,” but emphasized the monetary cost would be “substantial.” According to Burnett, the parks department based its infrastructure repair estimate of $3 million to $5 million on an outside expert’s structural assessment of the property in fall 2023.
“We were trying to give a realistic estimate of what the total cost of repairs and neglected capital improvements were and what it would take to really get us back on track to have the facility where it needs to be–where it’s safe,” Burnett said.
“We’re just continuing to try to clarify that at no point did we tell the Potomac Horse Center that they could not continue negotiations for renewal of the lease,” he said. “They’re the ones who told us that they were no longer interested.”
The horse center has received substantial community support since announcing its plans to close. By Tuesday morning, a change.org petition seeking to preserve PHC at its current locations had garnered 3,284 signatures, while a GoFundMe campaign had received $2,480 from 41 donations.
According to Burnett, when Montgomery Parks acquired the Quince Orchard Road site prior to 1993, the Montgomery County Council stipulated that public funds may not be used to support the property. Due to this stipulation, Burnett said the lessee is responsible for maintaining the property’s infrastructure.
However, Novograd’s April 30 statement claims the lease’s terms “are unsustainable under current economic conditions.”
“PHC pays M-NCPPC monthly base rent for use of the facilities plus a percentage of PHC’s net and gross incomes,” she wrote. “Additionally, PHC pays for Capital Improvements, repairs and maintenance of M-NCPPC’s property.”
Novograd said PHC’s lesson program income must also cover “veterinary care, farrier services, hay and grain for the horses, utilities, payroll, insurance, farm equipment maintenance, fuel, and tack.”
“It has become nonviable for our programs to cover the increasingly higher and higher costs of the rapidly aging infrastructure, let alone allow PHC to build up the three to five million dollars required by M-NCPPC to proceed with negotiations,” Novograd said in her statement.
“PHC simply cannot ask our clients to pay for and invest in a rapidly deteriorating infrastructure that PHC does not own,” Novograd said.
She did not respond to an interview request sent via text Friday.
Potomac Horse Center utilizes 11 buildings on the property. According to Burnett, the parks department closed two after identifying “life safety issues” caused by deteriorating infrastructure and found the other nine in need of repairs as well.
“We wanted to make sure that not only the individuals using the facility were safe, but also the animals, because there were close to 70 horses there at one point,” he said. “We need to make sure that all of those structures and all the infrastructure is brought up to code or brought to at least a reasonable standard,” Burnett said.
Moving forward, Burnett said the parks department needs PHC to provide a plan detailing how the business intends to address necessary capital expenses to continue lease negotiations.
Burnett said the repair estimate is a result of the property receiving inadequate maintenance and capital improvements over the past three decades.
“Now we’re to a point where buildings are in disrepair, they’re unsafe, and that all has to be corrected because we can’t in good conscience move forward with another long-term lease with a facility which is not safe–much of it is not safe–for use,” Burnett said.
The 1993 lease between the parks department and PHC covered 20 years with two five-year extensions. At the 20-year mark, Burnett said a property assessment determined the buildings required infrastructure investment due to their poor condition.
The parks department performed another assessment last year in response to the horse center’s intent to renew the lease, according to Burnett. He said the results of that assessment deemed some of the buildings unsafe because there had not been “a continual and directed application of money toward the capital improvements.”
Burnett said the parks department received an estimate from PHC for installing sleeves over posts in the facility’s main barn, but added that those measures “didn’t address the life safety issues that were included in the structure assessment that was done.”
If Montgomery Parks assumes control of the property in July as expected, Burnett said the department will first secure the facility to prevent vandalism and injuries before working with its planners to determine the best course of action for the property.
“For us, it’s kind of a hard thing,” Burnett said. “[Parks] has a lot of properties that are waiting for construction money and so this would have to get in line with everything else, which [have] been in the queue for years, in order to get construction or rebuilds and those sorts of things. Trying to figure out how to get this into that mix or how to have someone else be able to take care of some of it or what we’re going to do next is our next big step.”