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Ehrlich makes appeal for Md. slots

Gov. Robert L. Ehrlich Jr. opened the first legislative hearing on his proposed bill to allow slot machines at Maryland racetracks yesterday with an impassioned plea to save the horse racing industry and an unusual personal swipe at House Speaker Michael E. Busch.

Making a rare gubernatorial appearance before a legislative committee, Ehrlich told lawmakers that some members of his administration see racing as a fading industry that should be allowed to die a natural death.

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"It is a legitimate view that I reject wholeheartedly," Ehrlich told the House Ways and Means Committee. "I think that way of life and that industry and that culture are worth saving."

Ehrlich and Lt. Gov. Michael S. Steele applauded legislators for passing a bill last year adopting the recommendations of the Thornton Commission for a new education aid formula designed to bridge the gap between rich and poor jurisdictions. Slots, they contended, are needed to pay for the increased spending called for in the formula.

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Ehrlich and Steele led a parade of witnesses pro and con who testified well into the night. Among those speaking in favor of the legislation was state schools Superintendent Nancy S. Grasmick, making an unprecedented appearance on behalf of a revenue bill.

The governor spoke with unusual fervor, but his message may have been overshadowed by his blunt criticism of Busch, who sat stone-faced in the hearing room, for allegedly making race an issue in the debate.

Asked by a legislator about comments he made behind closed doors the day before about Busch playing "the race card," Ehrlich told the committee: "I meant what I said."

Busch, the General Assembly's leading opponent of slots, has asked why Ehrlich's proposal would put slot machines at tracks in low-income and heavily black neighborhoods but not at Timonium or Ocean Downs.

Ehrlich said it was "inappropriate" to raise that issue.

"I resented it. The lieutenant governor resented it," Ehrlich said, criticizing Busch for meeting recently in Baltimore with a group of predominantly black clergy on the slots issue.

"No one has explained to me why African-American preachers are being targeted," Ehrlich said. "Why not white preachers?"

Busch, who went to the hearing table minutes later to introduce an anti-slots witness, called Ehrlich's remarks "extremely hurtful."

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The Anne Arundel County Democrat said his first meeting with clergy on the gambling issue was with a predominantly white group of ministers in Annapolis. Only later, he said, was he asked to meet with the Interdenominational Ministerial Alliance in Baltimore.

"It was not something I pushed upon anyone. I was invited," Busch said.

Outside the hearing room, Busch said he was "astonished" that Ehrlich - a longtime friend - would say what he did in a public forum.

The Rev. Gregory Perkins, head of the ministerial alliance, dismissed Ehrlich's allegation that Busch had played the race card.

"I was not pressured. I was not targeted," Perkins said. He said he invited Busch to speak and would do so again.

Ehrlich made his case before a tough audience. Anti-gambling activists had packed the room more than an hour before the hearing - demonstrated by the prolonged applause Busch received when he entered the hearing room.

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The exchange over race came as Ehrlich, Steele and others attempted to make a strong case for a bill whose details are almost entirely up in the air.

The administration is working on what appear to be wholesale revisions to a bill that met with near-total dissatisfaction when it was unveiled in late January. Racetracks said the governor's proposal to give them 25 percent of slots proceeds was unworkable, and other groups joined the chorus of complaints that their shares were too small. In response, the administration hired an outside consultant to re-evaluate the numbers.

Del. Sheila E. Hixson, the Montgomery County Democrat who chairs the committee, pressed Budget Secretary James C. DiPaula Jr. to deliver the administration's revised formula for dividing the proceeds.

"I want to make sure we have the right numbers," DiPaula said. "We're very close. We need to review this with the industry."

Hixson replied: "If we don't have your numbers soon, we'll be dealing with our own. We're going into budget negotiations next week."

While Ehrlich's message focused largely on saving the horse racing industry, Steele emphasized the need for revenue for education.

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"In 2002, you bought Thornton. In 2003, it's time to pay for it," the lieutenant governor told lawmakers. "If you take this out of the revenue stream, my fear is that our kids will be the ones who pay the price."

Grasmick, echoing Steele, asked lawmakers: "If not this, what? We cannot continue to provide high-quality education without the infusion of this money," she said.

Grasmick was followed to the stand by Rep. Frank R. Wolf, a Virginia Republican and prominent opponent of expanded gambling. Wolf, who said he is a friend of Ehrlich's from their days in Congress, said he felt compelled to testify when Busch invited him because of his passionate convictions on the issue.

"This is not a Republican or a Democratic issue," said the congressman, whose Northern Virginia district lies across the Potomac River from Maryland.

Wolf said studies have shown that casino gambling - of which slots are the major component - increases crime and bankruptcy in nearby communities. He said locating slots just across the Woodrow Wilson Bridge from Virginia at Rosecroft racetrack would have a negative impact on Maryland, Virginia and the District of Columbia.

"If slots come to Maryland, there will be great pressure to bring gambling to the state of Virginia," Wolf warned.

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In an interview afterward, Ehrlich agreed that it is rare for a governor to testify and expressed concern that it might raise expectations about future bills.

"When the charter school bill comes up, will they ask, 'How come Bob's not there?'" he said. Asked about his criticism of Busch, the governor said: "I stand by my words."

Ehrlich's comments did not play well with lawmakers.

"I was shocked," said Del. Anne Healey, a Prince George's County Democrat and vice chairman of the committee. "People disagree all the time and sometimes they get intense, but that seemed to go beyond what I've seen, and I've been here 12 years. That kind of rhetoric seemed over the top."

Del. Michael R. Gordon, a Montgomery County Democrat and panel member, said Ehrlich's remarks were in poor taste.

"I'm sure the governor didn't mean anything by it," Gordon said, "but Mike had to do something about it. He couldn't just let it hang."

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Even a leading Republican said the governor's comments would not help his case.

"Any conversation that shifts off the merits of the bill hurts our chances in passing the bill," said House Minority Leader Alfred W. Redmer Jr., a Baltimore County Republican.

The hearing drew a diverse collection of witnesses on both sides of the issue.

Pastors, neighborhood activists, restaurateurs, tavern owners and the National Association for the Advancement of Colored People were among the opponents. Farmers, the Jockey Guild, racetrack owners, and the Maryland Chamber of Commerce supported the bill.

Horse racing representatives said their industry is struggling to compete with tracks in Delaware and West Virginia, where slots are allowed.

"Our industry is worth saving," said Tom Winebrener of the Cloverleaf Standardbred Owners Association. "We cannot compete with neighboring states when they have slots revenue going into their purses and we do not."

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Tom Stone, a lobbyist for the Maryland Restaurant Association, said business fell off 20 percent to 50 percent for restaurants in Minnesota within 30 miles of a major casino.

"If people are spending money on slots, they are not spending it in restaurants or for other goods and services," he said.

But Kathy Snyder, president of the state chamber, said restaurants and retailers in Delaware and West Virginia had not seen a drop in business.

"There is a positive spillover in those communities," she said.

The author of a rival bill, Del. Howard P. Rawlings, outlined a series of changes to his version of slots legislation.

Rawlings said he will soon offer amendments requiring a minimum level of minority ownership at the four proposed slot machine operations. The Baltimore Democrat signaled that agreements to bring in minority partners are in the works.

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Rawlings said he would scale back the up-front licensing fees he would charge the tracks. Legislative analysts have suggested that the fees, which Ehrlich depends upon to balance next year's budget, would result in a lower percentage of operating revenue and a bad deal for the state in the long run.

Rawlings said his amendments would require a comprehensive plan for marketing the horse racing industry, as well as significant capital improvements to the tracks. Neither provision is in the Ehrlich bill.

Sun staff writers David Nitkin and Patricia Meisol contributed to this article.

What they said

"I just have one question: If we don't do this, what do we do?"

Lt. Gov. Michael S. Steele

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"This is the darndest deal I've ever seen. They can't get it out of the back room. This is not about buying a pig in a poke. We don't even have a poke here."

Rev. Tom Grey, executive director of the Illinois-based National Coalition Against Gambling Expansion

"We can't build a wall around Maryland and prevent Maryland people from going to Delaware and West Virginia to bet on slots."

Redmond Finney, a horse breeder and former headmaster at Baltimore's Gilman School

"It is bad public policy for the state to encourage its weakest and most vulnerable citizens to engage in pathological and addictive behavior."

Rev. Gregory Perkins, head of the Interdenominational Ministerial Alliance

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"You all bought Thornton [increased school funding formula] last year, but you didn't pay for it. If you are serious about funding Thornton, and the president of the Senate said no taxes, your options are limited."

Gov. Robert L. Ehrlich Jr.

"I've seen what it's done to families. The damage gambling leaves in its wake is heartbreaking."

Rep. Frank Wolf, a Virginia Republican and prominent opponent of expanded gambling

"We do not want slots casinos in Maryland. We believe in progressive revenue sources, and an expansion of gambling is regressive."

Judith B. Morenoff, president of the League of Women Voters in Maryland

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"We're not dead. We're hurting and we're asking for a little help."

Billy Boniface, a fourth generation Maryland horse breeder



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