Peters' version of the bill would have authorized a casino with up to 4,750 slot machines "within 4 miles of the intersection of Bock Road and St. Barnabas Road" in Prince George's County. Both National Harbor and Rosecroft Raceway, which are about five miles apart, met that requirement.
However, as the discussion of the legislation evolved during the session, Rosecroft Raceway was all but written out of the equation. Steve Snyder, a senior vice president at Penn National Gaming, the company that owns Rosecroft, pleaded with the work group not to let that happen again.
Snyder argued that legalization of slots was first raised as an idea for how to save the struggling racing industry in Maryland
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"That was one of, if not the principal, motivation for us in acquiring Rosecroft Raceway," he said.
Snyder said Penn National is prepared to invest $300 million to build a casino at Rosecroft with 2,000 to 4,000 slots at the existing 67 percent tax rate.
For that to happen, the state would have to strike down a provision in the current law that prohibits a company from operating more than one facility in the state, as Penn National owns Hollywood Casino in Perryville.
Peters' bill included the removal of that provision. However, Snyder told the working group: "If we must, then we will figure out internally a solution," noting the company has discussed restructuring as an option.
National Harbor casino would draw from D.C., Virginia
National Harbor, however, appears to be the favored location for the sixth casino as it has the backing of Prince George's County Executive Rushern Baker III and Senate President Mike Miller. Also, the state has commissioned PricewaterhouseCoopers to provide financial analysis of the impact of a casino at National Harbor, not any other location.
The proposal that has been floated is a facility with 4,750 slots and table games, the latter of which developers have said is key in their interest to build a casino at National Harbor.
"We don't want this just to be a casino," said Milton Peterson, founder and chairman of the Peterson Companies, the company that developed National Harbor. "We want this to be a destination resort that has one of its amenities, a casino."
The mix-use development, located along the waterfront of the Potomac River, "is really an extension of Washington," and as such, a casino at National Harbor would draw from the Washington market, Peterson said.
"The market place, in our estimation, is big enough to support a billion dollar casino," said Andrew Moody, a economic advisor working on the National Harbor plan.
However, to support a facility that costly, he said, the combined tax rate on slots and table games would have to be lowered to a 32 percent.
Recognizing that "32 percent won't happen," Moody said National Harbor developers are proposing to build a $750 million casino if the state sets the tax rate for slots at 52 percent and table games at 10 percent.
National Harbor plans target Washington and Virginia, where gambling is illegal — a strategy that directly conflicts with Maryland Live.
"The vast majority of our marketing dollars are being spent in the D.C. market versus the Baltimore market because of the expectation of exclusivity," said Joe Weinberg, of PPE Casino Resorts Maryland, the company which holds the license for Maryland Live.
Maryland Live, he said, would lose 40 percent of its projected slots revenue if an equally large casino were to open at National Harbor.
"The average size of a casino in this country is between 1,000 and 1,500 (slot) machines," Weinberg said. "These facilities are not (like) Starbucks that can be put on every street corner and sustained."
Moody, meanwhile, said the revenue Maryland Live would lose to a National Harbor casino would be about 10 percent, if both facilities were allowed to offer table games, or 15 to 20 percent if the facilities could only had slots.
Pricewaterhouse Coopers is expected to present its financial estimates to the work group at the June 12 meeting.