Slots Council Weighs Proposed Gambling Changes

SNOW HILL — After a General Assembly special session this month proposed changes to Maryland’s gambling regulations, the Worcester County Local Development Council (LDC) went to work Monday trying to understand exactly what the new rules will mean.

While the changes received general support from the LDC, some did question what kind of impact loosening restrictions on casinos could have for the entertainment industry. All decisions made during the special session will be included as a referendum question for Maryland voters in November.

“It’s actually going to be great, in my opinion, for Worcester County,” said Delegate Mike McDermott (R-38B).

McDermott admitted that he was “really reluctant” to enter into an August special session, which was the second this year following the conclusion of the regular session in April and the first special session in May. Despite his reservations, McDermott told the LDC that he was satisfied with the legislation that the assembly was able to produce this month, especially given all of the roadblocks the discussion over gambling hit in the regular and first special sessions.

Included in the new law will be provisions for table games, a sixth casino location in Prince George’s County, some financial restructuring and entertainment changes. The tax rate for the Casino at Ocean City is also dropping from 67 to 57 percent, while the share of gross revenue is going up from 33 to 43 percent.

Additionally, under the new legislation, Worcester will receive an annual $200,000 grant from the state that comes without earmarks and the 18 percent of local impact money made by Ocean Downs that is re-directed to Baltimore City and Prince George’s County will cease when those areas get their own casinos, expected within the next few years.

The changes are expected to help casinos, like Ocean Downs, that are struggling to make a profit.
“It was a very, very good bill,” said State Senator Jim Mathias (D-38B).

As arduous as the process has been, Mathias told the LDC that he was satisfied with where it all landed and is eager to see how the aspects of the bill that are up for public referendum are viewed by voters.

“Now, where it is, it’s in the most important place, which is the hands of the voter,” he said.

Mathias also commented on the bi-partisan support that the bill eventually saw, drawing in proponents from both sides of the aisle this session and culminating in a piece of legislature that benefitted from numerous points of view.

“Success has a lot of parents; failure is an orphan,” he quipped, stressing that this was “a successful bill.”

McDermott agreed and though he admitted to rarely agreeing with Gov. Martin O’Malley’s policies, he said that all parties involved in the gambling legislation “were really open.”

“It’s politics up there but they’re always looking for opportunity,” he said.

Not everyone viewed the results of the session as favorably, however. During a stop in Worcester to promote Tax Free Week last Thursday, State Comptroller Peter Franchot bashed the new legislation, calling the events and end result of the August special session “one-half step from corrupt.”

“I’m particularly concerned with the process,” said Franchot, who claimed that “casino moguls have tentacles” in Annapolis and played a bigger part than they should have in shaping the newest bill.

A small group of special interests took the reins with the bill, he continued, and helped guide a series of changes that were shocking and biased.

“It’s just damn unfair and I’m telling you, as your comptroller, that the special session was a disgrace,” said Franchot.

In reference to casino tax rates dropping, he took a stern view of the current gambling situation, saying that the “tax cuts [were] for companies that didn’t need it.” And, despite Mathias and McDermott talking up the cooperation in forging the bill, Franchot blasted O’Malley and his allies for keeping everything, in his opinion, behind closed doors.

“We’re all on the outside looking in,” said Franchot.

Franchot ended his comments on a note of concern over what loosening entertainment guidelines for state casinos will mean for competition with established operations, like those in Ocean City. He specifically mentioned amusement parks as a possibility at the casino grounds.

“What are we doing now: competing with the Boardwalk with all four feet,” he said.

Though he praised some parts of the bill, Ocean City Mayor Rick Meehan did voice some similar worries over what new privileges in entertainment the new changes will mean for casinos. Under the bill, casinos will have a lot more wiggle room in regards to what they are allowed to provide. Previously, Ocean Downs was only allowed to host live fireworks shows and a single piano player.

This was part of their agreement not to compete with Ocean City as an amusement and entertainment destination. Now, they’ll be able to feature any entertainment they’d like, presumably as long as it is allowed and approved by the Board of License Commissioners (BLC).

Meehan stated that such a limitation was fair as it provided “a level playing field for everybody.” However, he was concerned that language in the new bill wasn’t clear enough on exactly who would control what kinds of entertainment and that state authority might trump the BLC’s.