Business leaders back Md. casinos Chamber panel fears neighboring states will take the lead; Glendening in opposition; Report recommends sites in Baltimore, Western Maryland

THE BALTIMORE SUN

OCEAN CITY -- A panel of prominent Maryland business leaders delivered a surprisingly strong endorsement of casino gambling yesterday, urging Maryland officials to legalize casinos before neighboring states beat Maryland to the punch.

In a report to the Maryland Chamber of Commerce, a committee of five former chamber chairmen recommended that at least two and not more than three land-based casinos be approved for Maryland.

One should be located in Baltimore's Inner Harbor and one in the mountains of Western Maryland, the report said. If there is a third site, it should be in Maryland's Washington suburbs to take advantage of the area's international tourism, the report concluded.

Casino lobbyists hailed the report, saying it will ignite their stalled efforts to persuade state officials to go along.

But in a strong disclaimer, the president of the chamber characterized the report as nothing more than a recommendation.

Moreover, a number of lawmakers attending the chamber's legislative conference here said they were not swayed, and Gov. Parris N. Glendening was expected to warn "against being lured by the sirens of easy money from casinos" in a speech to the chamber last night.

"I know it is tempting to fantasize about a quick $100 million in revenue from casinos," the governor said in prepared remarks. "Personally, I think we should place our bets on good fiscal management, education and hard work."

The report, however, said the only way Maryland can cut the best possible deal with casino operators is to move quickly.

"If we're not first in the region, we lose negotiating leverage," said committee chairman J. Henry Butta, the former president of C&P; Telephone Co. of Maryland.

The strong recommendation from the business executives is the first report to surface from several groups that have been studying the casino issue for months.

"I think a lifeless body has been resuscitated," gushed Gerard E. Evans, who represents Harvey's Casino Resorts of Lake Tahoe, Nev.

"This will be a blueprint for enactment of casino gambling in Maryland," said Mr. Evans, one of several casino lobbyists in the audience.

But Champe C. McCulloch, the chamber's president, said the action is only the beginning.

"To the [news] media and to advocates who might posture this as the chamber's position, this is not the chamber's position," Mr. McCulloch said. "This is just a first step."

He said the chamber's executive committee, which initially had planned to accept or reject the report, has decided instead to mail it to all 1,600 member firms and put the issue to a vote.

Formal decision delayed

The chamber is not expected to take a final, formal position until December, just before the issue goes to the 1996 General Assembly.

In addition to Mr. Butta, the committee included former U.S. Sen. J. Glenn Beall Jr.; lawyer Ronald E. Creamer; Richard E. Hug, chairman of Environmental Elements Corp., and Thomas Sherlock, retired president and chief executive officer of Blue Cross/Blue Shield of Maryland.

Mr. Butta said a straw poll of the panel when the group was formed in April went 4-1 against casinos, but changed to 4-1 in favor by the time their research, public hearings and site visits to casinos in New Jersey, Louisiana and elsewhere were over.

The dissent came from Senator Beall, who said he does not believe Maryland needs casino gambling. He also opposed the designation of Baltimore and his home area of Western Maryland as potential sites.

The report concluded that casinos probably will hurt Maryland's $1.2 billion horse racing industry, but said the industry has been in decline for a decade, adding, "The state has no obligation to save a dying industry."

De Francis 'dumbfounded'

That reference infuriated Joseph A. De Francis, owner of Maryland's two thoroughbred tracks, who said Pimlico and Laurel last year enjoyed their best year ever "measured by handle, attendance, wagering -- any measure, any statistics."

Mr. De Francis described himself as "astonished" and "dumbfounded" that a Maryland Chamber of Commerce group would abandon such an important home-grown industry in favor of out-of-state casino companies.

The racing industry has been a leading opponent of efforts to legalize casinos in Maryland.

The report conceded that casinos would likely hurt the state-run Lottery, possibly trimming as much as $30 million a year from the state's third largest single source of revenue.

It said crime did not appear to be any worse in cities with casinos, and said there is no way to predict whether compulsive gamblers will become more addicted if casinos are permitted.

Noting the many forms of legalized gambling already present in Maryland, Mr. Butta said, "It seems to us that those who are prone to addictions to gambling have plenty of options available to them today."

Protection for restaurants

Mr. Butta said the effect of casinos on nearby businesses in other states has been "mixed." To protect Maryland restaurants and hotels, the study group recommended that casinos be prohibited from subsidizing food, drinks or accommodations with gaming revenues.

But Tom Stone, a lobbyist for the Maryland Restaurant Association, said he was still worried that casinos would "cannibalize" restaurants and other existing Maryland businesses.

Delegate Nancy Jacobs, the Harford County Republican who sits on the Judiciary Committee that likely will consider any casino gambling legislation, said she thought the study panel reached a conclusion and then found the facts to support it.

"I'm on the committee that deals with it, and I'm parting company with the chamber on this one," she said.

Under questioning from Doug Duncan, the Montgomery County executive, Mr. Butta acknowledged that the panel never considered Ocean City as a potential casino site, and never studied tourism statistics in the three areas where it did recommend that casinos be located.

"Their arguments didn't make any sense," the Democrat said, adding: "I haven't heard anybody in my county say they are in favor of casino gambling."

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