Panel aims to expand slots plan


A Senate committee moved last night toward expanding Gov. Robert L. Ehrlich Jr.'s slots proposal to include a racetrack near Ocean City and a third nontrack location, while cutting the share of revenues for the owners of slots facilities.

As part of the legislation, the committee proposed adding $98 million in aid to local schools called for in the Thornton plan. The full amount would be phased in over five years, but the first half of the cost would be covered next year in $52 million in slot machine license fees to be charged to the track owners by October.

The proposal -- which could be voted on by the Senate Budget and Taxation Committee as soon as today -- keeps the number of slot machines permitted in Maryland at 15,500, the same number proposed by Ehrlich. But the tracks would receive fewer machines.

The measure would permit 2,000 machines each at Pimlico Race Course, Laurel Park and Rosecroft, as well as 1,000 machines each at Ocean Downs and a track to be built in Allegany County. After the initial machines are up and running, state officials would divide an additional 1,500 machines among Laurel, Pimlico and Rosecroft, depending on which would be most lucrative.

The three nontrack locations would each be permitted to receive 2,000 machines under the plan, which was discussed during a nearly three-hour committee work session last night.

But the committee moved to limit where those sites could be located on the Interstate 95 corridor, removing Baltimore County and Howard County. That leaves Baltimore City and Cecil, Harford and Prince George's counties as the potential homes for slots facilities.

The governor is seeking to expand gambling in Maryland to help pay for promised increases in public schools funding, saying it could produce enough revenues to cover nearly 70 percent of the $1.3 billion called for under the Thornton plan. Opponents say the governor has overstated the potential revenues.

"We're certainly pleased with the progress," said Budget Secretary James C. "Chip" DiPaula Jr., who monitored the committee's work last night

Senate President Thomas V. Mike Miller said yesterday that he hopes to have the slots proposal before the full Senate for consideration next week. Last year, the Senate approved a slots measure, but it was killed in a House of Delegates committee. The fate of slots in the House is again in doubt this year.

What might be the most contentious proposal under consideration by the Senate committee includes expanding gambling to the Ocean Downs harness track -- an idea strongly opposed by Sen. J. Lowell Stoltzfus, the Senate minority leader who represents the area, and Ocean City Mayor James N. Mathias Jr.

The owner of Ocean Downs, William J. Rickman Jr. , was identified as the state's leading gambling-connected contributor to political campaigns, according to a report issued last year by Common Cause/Maryland. Rickman also owns the license to the proposed Allegany track.

Mathias said Ehrlich would be reneging on a promise to keep slots out of Worcester County if he allows a bill to emerge that includes Ocean Downs. "He gave me his word in June 2002, when he was a candidate, that there was going to be no slot machines at Ocean Downs, no slots in Worcester County," Mathias said.

Ehrlich adviser Paul E. Schurick said last night that the governor remains opposed to slots at Ocean Downs and wasn't reneging on his promise.

"The governor cannot support a bill that includes Ocean Downs," Schurick said. "I'm very disappointed that anyone would question the governor's commitment."

But Schurick stopped short of saying a bill that includes Ocean Downs would be a "deal breaker," as would be the case if a slots bill was coupled with a sales or income tax increase.

Sen. Patrick J. Hogan, a Montgomery County Democrat and the committee's vice chairman, said Ocean Downs, a harness racing, or standardbred, facility, shouldn't be the only track in Maryland without slots.

"Ocean Downs is a standardbred track, and without Ocean Downs in, you've got three thoroughbred tracks and one standardbred track," he said. "I think standardbred tracks get the short end ... and I think this would further that if you left Ocean Downs out. I think it's a matter of fairness."

The committee also proposes revising the Ehrlich administration's formula on how to split the revenues from slot machines after winning players are paid. The governor proposes 39 percent going to track owners.

The committee's plan includes a sliding scale, with track owners keeping a lower share as the machines take in more money. Legislative analysts predict that the machines could take in $275 to $325 per machine per day.

"As you get toward the upper end of that, there is at least the perception that the operators would be receiving a windfall," said Warren G. Deschenaux, the legislature's chief fiscal analyst. The committee recommends that track owners receive 39 percent of the first $150 of revenues of the daily average per machine, but that share would slowly decline, falling to 27.5 percent of revenues in excess of $350.

Companies seeking to win licenses for the three nontrack slots locations would not be allowed to submit bids that asked for shares of slots revenues higher than 30 percent.

Slots opponents said the Senate committee's proposed changes are just the start an expansion of gambling that they say is inevitable.

"I think the message to the typical Maryland resident is, 'Nobody is safe,'" said Aaron Meisner, coordinating chairman of a coalition of Maryland anti-slots groups. "If you think you don't have anything to worry about because your neighborhood is not in the bill currently, just give it a few weeks, a few months or a few years and see what you get."

Sun staff writers Greg Garland and Michael Dresser contributed to this article.

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