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Casino funds increase, state funds decrease to Harford schools

FinanceCasino and Gambling IndustryElectionsExecutive Branch

More money has been rolling into casinos in Maryland, but changes would have to be made at the legislative level for a larger cut to go to schools.

Casinos brought in slightly more than $900 million in revenue since the first establishment, Hollywood Casino at Perryville, opened in 2010.

Casinos have since opened at the Ocean Downs Racetrack in Worcester County, Arundel Mills in Anne Arundel County and the Rocky Gap Casino Resort in Western Maryland.

The Rocky Gap casino opened in the spring of 2013. Casino sites have also been approved for Baltimore and Prince George's County.

Casinos started with slot machines, but added table games in early 2013, and have been approved to operate 24 hours a day.

Officials with the Maryland Lottery and Gaming Control Agency, which is charged with regulating the state's operating casinos and the Maryland Lottery, reported $608.3 million in casino revenue for the 2012-2013 fiscal year, which ended June 30.

More than $829 million was raised through the casinos and lottery, a 27.6 percent increase from the 2012 fiscal year.

Gaming officials reported $1.75 billion in lottery sales for FY2013, 2.2 percent less than the $1.79 billion earned in FY2012.

Slightly more than $545 million in lottery earnings went to the state's general fund in FY2013.

Slot machine revenue is divided seven ways, including the state's Education Trust Fund, the casino operators, purses for horse racing, Local Impact Grants for the communities in which the casinos operate, racetrack capital projects and facility improvements, the Lottery and Gaming Control Agency for regulatory costs and support for small businesses as well as those owned by women and minorities.

The largest share, 49.25 percent, goes to the Education Trust Fund; the next-largest share, 33 percent, goes to the casino operators.

Casino operators take in 80 percent of table game revenue; 20 percent is allocated to the Education Trust Fund.

William Reinhard, spokesman for the Maryland State Department of Education, said school systems are funded by the state's general fund and the Education Trust Fund.

Funding formulas are based on student enrollment and the wealth of each school district, or its net taxable income.

While state support of public schools has increased overall, state aid to Harford County Public Schools, which made up 44.1 percent of the school system's $424.7 million budget for the current 2014 fiscal year, has decreased during the past four fiscal years.

Charts posted on the education department's web site indicate that $146.4 million was allocated to Harford County in FY2011 for the Foundation Program, which is general state aid to schools, that can be used at local school officials' discretion, Reinhard explained.

The total funding, including grants for specific programs such as transportation, Limited English Proficiency and special education, was $203.7 million that year.

The total state funding for Harford in FY2014, including grants, was $195.9 million; the foundation funding was $137 million.

The state increased its overall funding for school districts over the four-year period, from $2.89 billion in FY2011 to $2.98 billion in FY2014 for the Foundation Program. Total funding, including grants, increased from $4.68 billion to $5 billion.

The county lost several million in funds from FY2013 to FY2014 because of a slight increase in the county's wealth.

Harford County Executive David Craig called the wealth formula "totally ridiculous."

"We do have poor people living in Harford County," he said Monday.

Craig, who is a Republican candidate for governor in 2014, has come under criticism in recent months for not fully funding the Board of Education's request for local funds for the current fiscal year.

He increased funds by more than $1 million from the previous year, but school leaders sought about $20 million more in local funds to cover increased costs of doing business, pensions, employee benefits and employee salary increases.

Reinhard said any changes to funding formulas, to take increased casino funds into account, would come at the legislative level.

He said any announcements about changes in state aid to local school districts would come from the governor's office close to the beginning of the next legislative session in January.

"We administer," he said of state education officials. "We don't really set the policy or amounts."

Craig also objected to using gambling revenue, which is subject to change, to support the state's budget.

"It is improper to balance your budget based on gambling," he said, referring to personal and government budgets.

Craig suggested using gaming revenue to pay down debt or for infrastructure projects such as school construction or renovations.

He said communities would not have to depend on financing from bond sales, which add to local debt, as much, for infrastructure.

"Things would be built, they would be paid for," Craig said. "That's a much better way to handle government."

Money continues to come into casinos; gaming officials released earnings for September earlier this month, which showed $65.3 million in statewide revenue; $21.7 million of slots revenue and $3.9 million of table games revenue went to the Education Trust Fund.

Copyright © 2014, The Baltimore Sun
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