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New spin on gambling debate: Are those bingo machines slots?

In what could signal the start of a video gambling gold rush in Maryland, an Anne Arundel bingo hall operator is seeking permission from the county to put devices that are virtually indistinguishable from slot machines into his establishment.

Dozens more bingo operators could follow suit in what gambling experts say is the latest wave of gambling expansion - essentially video slot machines that have been modified to technically comply with state laws that permit bingo but prohibit traditional slots.

And the machines could flood the state regardless of what the General Assembly decides to do about legalizing slots because of county-by-county laws that allow bingo.

The state Senate has approved, for the second year in a row, a plan by Gov. Robert L. Ehrlich Jr. to legalize slots, though it faces an uncertain future in coming weeks in the House of Delegates.

The Anne Arundel County Amusement License Commission is considering a request from Edward O. Wayson Jr., made on behalf of the Maryland Commercial Bingo Coalition, to allow the devices.

The coalition includes the Wayson family, which owns a 750-seat bingo hall at Wayson's Corner, and the owners of two other commercial bingo halls in Anne Arundel County.

"We think the machines are legal," Wayson said.

Carrying names such as "Triple Threat Bingo," the machines feature colorful lights and spinning drums with depictions of cherries, diamonds and other icons familiar to slots players. Customers drop in coins, push a button and, if the cherries line up, can win hundreds of dollars.

But, unlike slot machines, the devices are modeled to track bingo play and they print out paper tickets for winners to cash rather than dropping money or tokens into a hopper.

Companies that furnish bingo supplies in Maryland say they would like to see them installed wherever bingo is played in Maryland, including games run by nonprofit fraternal groups, social service clubs and similar organizations that use bingo to raise money for charity.

"We're trying to push them ourselves in Anne Arundel County, Baltimore - any county in the state," said Frank Moran of Frank Moran & Sons, who heads a family-run bingo supply company in Arbutus.

One gambling industry analyst from Goldman Sachs, who attended a bingo-related trade conference in Las Vegas last week, was quoted as saying that Pennsylvania and California are likely to get 30,000 each of the bingo machines over the next four years and that Maryland is likely to get 7,750 or so.

That's about half the 15,500 slot machines Ehrlich wants to put at three horse tracks and three other sites in Maryland.

I. Nelson Rose, a professor at Whittier Law School in Costa Mesa, Calif., and an expert on gambling law, said a series of court rulings has opened the door to the expansion of video bingo games that are virtually indistinguishable from slots.

"Even if it looks and plays like a slot machine, if it has the characteristics of bingo, then it's a bingo machine," Rose said, referring to the way courts have tended to view the issue.

In Maryland, the legal groundwork for allowing such machines was laid with a 2001 ruling in the Maryland Court of Appeals. The case involved the Rod & Reel in Chesapeake Beach, a restaurant and marina run by the Calvert County town's mayor, Gerald Donovan.

The court ruled that the Rod & Reel's "Lucky Tab II" machines were legal in Maryland.

The Rod & Reel has 75 of the devices in the bar area adjacent to its restaurant and in a second-floor hall where it runs traditional bingo games.

Specific machines

Donovan said the court ruling was specific to the type of machines he has, which are designed to comply with state law that allows bingo operators to sell instant bingo tickets, also known as "pull tabs."

The machines feature a spinning, video slot type reel with symbols such as cherries or playing cards. A winning combination triggers the machine to spit out a preprinted ticket with a bar code that can be redeemed for a cash prize.

Wayson is seeking to expand beyond those types of machines to ones that don't use preprinted tickets but are designed to technically comply with the rules for traditional bingo.

Experts say the latest versions of the machine - which are installed in many Indian-run casinos - resemble even more closely the operations of a true slot machine.

"All I can say is they are certainly closer to a slot machine than our machines," said Jim Breslo, president of Diamond Game. Breslo's California-based company manufactures the "pull tab" video bingo machines that were at issue in the Maryland lawsuit.

"There's one type of game approved in Maryland and that's our game," he said. "All these other games are an open question."

But Wayson said he believes the machines he wants to introduce meet all legal requirements. He said further that he thinks county regulatory officials have the authority to allow him to install the new machines, without necessarily having to seek changes to the county code though the County Council.

Slots opponents are not pleased by the prospect that Maryland law could be loose enough to allow the state to be flooded with thousands of bingo machines that resemble slots.

"I would think that kind of issue would be challenged in a court of law," said House Speaker Michael E. Busch. "If there is a loophole there, I think the legislature should take it up."

Assistant Attorney General Kathryn M. Rowe said that office hasn't been asked to review whether the new types of machines comply with state law.

"We've never had to do a legal analysis of where it falls," Rowe said. "It is different than a pull tab bingo machine."

She said it is clear, as a result of the 2001 court ruling, that pull tab machines such as those at the Rod & Reel can be put anywhere the sale of bingo pull tabs are authorized.

For charity, profit

"Anybody that can have pull tabs can have these machines," Rowe said. She said that includes fraternal organizations and others that conduct bingo for charity, as well as the commercial halls.

All Maryland counties allow some form of bingo, usually for charitable causes, Rowe said.

"I think it's fairly common that many also permit pull tabs," she said.

So far, though, few outside of the licensed commercial halls in Calvert and Anne Arundel counties have chosen to get the pull tab machines.

Moran, who heads the bingo supply company in Arbutus, said many social service groups that conduct bingo games for charity are reluctant to pay the $5,000 to $7,000 cost of one of the machines.

Wayson's request to allow the new style of bingo machine in Anne Arundel is pending before the six-member Amusement License Commission, an advisory panel appointed by County Executive Janet S. Owens.

Anne Hatcher, who works in the county's permitting division, said it isn't clear yet whether council approval would be required.

"Under existing law, the director [of Inspections and Permits] has the authority to approve electronic devices" for use in commercial bingo halls, Hatcher said.

Mary Baldridge, chairwoman of the Amusement License Commission, said Wayson's group demonstrated the new bingo machines when the panel met in late February.

The commission is not expected to make a recommendation about whether the new machines should be authorized until after its next meeting, she said, most likely in June.

If slot-style machines become popular and spread across Maryland, the state stands to get little money from them.

Nonprofit groups that conduct bingo games for charity do not pay taxes to the state on the money they make from the games.

The commercial bingo halls that are authorized to conduct bingo in only two counties - Anne Arundel and Calvert - pay a state admission and amusement tax that goes back to the county.

Wayson said that the three commercial halls in Anne Arundel County paid a total of $700,000 to the county last year.

"We used to pay over $3 million a year to the county," he said.

He said much of the big drop was the result of Marylanders heading out of state to play slot machines in Delaware and West Virginia.

Copyright © 2015, The Baltimore Sun
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