Casino’s Direct Impact Fund Allocations Detailed

SNOW HILL — Despite increased competition the Casino at Ocean Downs is still seeing “moderate growth,” according to General Manager Joe Cavilla. If that growth continues it could mean more impact funding for Worcester County, which is poised to see a boost next year as other casinos in Western Maryland come online and the 18 percent of revenue that Ocean Downs sends across the bridge is returned.

At Monday’s Local Development Council (LDC) meeting, the group reviewed how the casino revenue-generated impact grant funding that Worcester County and some of its municipalities receive is being used.

A common allocation of funding was toward infrastructure improvements. Ocean City directed $454,948 that it received through impact funds toward street repair in FY13 with the intention of doing the same in FY14. Likewise, the Ocean Pines Association has used $591,545 for street paving in FY13 and estimates a similar expenditure for FY14.

The town of Berlin received $227,474 in impact funding and used that to purchase 5.25 acres of property in FY13 that will eventually house a new police station. The total cost of the property was $828,530 and the use of grant funds allowed Berlin to pay that off two years ahead of schedule.

There was some question over Berlin’s priorities by LDC member Cam Bunting, who owns a real estate office in town. She asked whether it might be better to move forward with a new community center before a police station since the current center on Flower Street is showing its age.

“Wouldn’t it be nicer to do a whole new community center than putting a Band-Aid on a building that’s old?” she asked.

A new community center is next up, said Michael Day, Berlin’s director of Economic and Community Development, but the council felt that a new police station should come first.

The county, which receives the lion’s share of impact grant funding, spent $202,050 for eight vehicles in FY13 and will spend $2 million in FY14 on debt service for the Worcester Technical High School.

Because impact funding is tied to the casino’s revenue, towns and the county will be working with more money if Ocean Downs grows. Significant growth over time seems likely, according to Cavilla.

“The activity at the casino remains consistent. We’ve got pretty moderate growth. Certainly nothing compared to what’s happening over the bridge, but the casino continues to perform well with moderate growth each month over the previous year which is certainly a good story in this economy and compared to some of the other facilities that may be on the Delmarva peninsula,” he said.

The Western Maryland casinos are a mixed-bag for Ocean Downs and Worcester. While they are in direct competition and likely siphoning away some customers, once the casinos across the bridge are all up and running, Ocean Downs will be allowed to cease sending 18 percent of its slot revenue to Annapolis. That was the deal that was made when the casino first installed video lottery machines. It was a raw deal, according to Delegate Mike McDermott.

McDermott is unhappy with the funding going across the bridge for what amounts to the privilege of Ocean Downs operating slot machines. He introduced a bill that would end that funding once the two remaining Western Maryland casinos come online, the first at the end of this year and the last sometime in 2015.

“That’s a lot of money leaving our county going to places that didn’t have any impact at all,” he told the LDC, “so this is kind of trying to right some wrongs, is what that was all about. So hopefully, as that money grows, there will be an ability for the rest of the folks in Worcester to share it.”

Some communities that were excluded from initial impact funding coverage are already anticipating the end of the 18 percent check to Annapolis. Snow Hill Mayor Charlie Dorman asked that his town and Pocomoke be considered for impact funding since neither are currently receiving any share of casino revenue.

“Well, you know mayor,” McDermott told Dorman, “that’s probably something that should be negotiated when that comes around because they were left out of the loop, as well you know, in the initial offering of this.”

However, Ocean Pines Police Chief David Massey pointed out that the reason for the impact funding that goes to Ocean City, Berlin and Ocean Pines is literally because of the “impact” that the Casino at Ocean Downs has on those communities, usually in the form of increased traffic and need for emergency response. Snow Hill and Pocomoke are far enough removed that direct impact isn’t an issue.

“That’s what the legislation was designed to do. To address the direct impact of the people who are impacted by the casino,” he said.

Ocean City Mayor Rick Meehan made a similar case and added that Snow Hill and Pocomoke already benefit from the impact funding that goes to Worcester County and is used on things like area schools.

Still, McDermott reiterated his belief that it’s a topic worth discussion in the future.