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O'Malley betting on slots

The Baltimore Sun

Reviving one of the most hotly debated issues in Annapolis, Gov. Martin O'Malley said yesterday that he will push for legalized slot machine gambling as a way to close Maryland's $1.7 billion budget gap, help the state's struggling horse industry and preserve open space.

The Democratic governor said he has not settled on all the details of his proposal but would use as a model a slots bill that the House of Delegates passed in 2005. That plan called for 9,500 machines at four locations -- one each in Anne Arundel, Harford, Frederick and Allegany counties. That would have allowed for slots at the Laurel Park racetrack but not at Pimlico in Baltimore.

O'Malley has not said where he would put the machines, but he favors state ownership and expects that they would generate about $550 million a year for school construction, education and other needs. About $100 million would go to supplement horse racing and $6 million to help problem gamblers.

The governor made his announcement at Maryland Stallion Station in Glyndon, using the backdrop of one of the state's prominent horse farms to argue that it is time that Maryland dollars stop flowing to Pennsylvania, West Virginia and Delaware, where he says slot machines subsidize horse racing, education and roads and help provide tax relief.

"It's time to put this issue behind us," O'Malley said yesterday. "It is time to find a consensus that allows our racing industry and horse-related agriculture to compete on a level playing field with the states around us, and it's time to stop sending dollars out of the state of Maryland and instead keep them here at home."

Slots will almost certainly be the toughest sell among the dozen measures O'Malley is proposing to eliminate the state's projected $1.7 billion budget shortfall and to add hundreds of millions in new spending for health care, transportation, higher education and the environment.

O'Malley's predecessor, Republican Robert L. Ehrlich Jr., tried and failed four times to bring slots to Maryland, thwarted largely by the Democratic-controlled House of Delegates. Although a fellow Democrat is now governor, House Speaker Michael E. Busch has not budged.

"My position on gambling has not changed -- I am not an advocate for slot machines," the Anne Arundel County Democrat said yesterday in a statement. "I don't think we can expect Marylanders to step up to the plate and pay $2 billion in taxes while unjustly enriching racetrack owners. I'll wait to see the full details of the governor's plan, but we will continue to work toward a comprehensive budget solution."

O'Malley's strategy of resurrecting the House slots bill could put Busch in a difficult position. Although Busch did not vote for the bill, he and other House leaders carefully crafted the legislation, brought it to the floor and orchestrated its passage, in part to help conservative Democrats in the House who were under intense pressure to enact slots.

Del. Eric M. Bromwell, a Baltimore County Democrat and one of the sponsors of the 2005 bill, said that given the state's financial situation and the governor's tax increase proposals, many voters want to see the legislature pass slots.

"People in my area are more interested in the state raising revenue without raising taxes, and that was a lot of the reason we put that plan together in the first place," Bromwell said. "I think people would be ready now more than ever."

In his news conference, O'Malley used variations on the phrase "the bill the House has already passed" at least a half-dozen times.

"The very fact that the Senate was able to pass a bill and the House was able to pass a bill shows that there is room for consensus and compromise to get this done," O'Malley said.

In 2005, Miller called the House plan unworkable and it died in the Senate. Yesterday he insisted that O'Malley's proposal will not be like that bill. He said O'Malley needs a bill with more machines than the House plan and with different locations, including one on the Eastern Shore. And the grants to local governments that were part of the House bill are a non-starter, Miller said.

"I think the governor is going to take part of the Senate bill and part of the House bill," Miller said. "That's what he told me."

O'Malley noted that he has been flexible and expects others to be as well.

Indeed, O'Malley's position appears to have evolved. The man who is now pushing for slots has historically been lukewarm on the issue, saying on the one hand that he supports slots at the racetrack to save racing jobs and on the other calling gambling in 2005 "a pretty morally bankrupt" way to fund education and other priorities.

As recently as last month, he said he wanted to use slots revenue only to fund capital projects, but yesterday he proposed using $425 million in gambling proceeds to support the state's operating budget.

"There will be aspects of this slots bill that will not totally be to my liking," O'Malley said.

Ehrlich was able to secure near-unanimous support from Republicans for slots, but some GOP legislators have already said they would be less likely to support expanded gambling knowing that O'Malley, not Ehrlich, would be the one deciding how to spend the proceeds.

Many Republicans disliked the 2005 House bill but voted for it anyway to keep the issue alive, hoping that it would result in a compromise with the Senate, said Del. Anthony J. O'Donnell, the minority leader from Southern Maryland.

"That doesn't mean we'll vote for it on final passage," O'Donnell said. "Anybody assuming broad support for that better talk to us."

Del. J.B. Jennings, a Baltimore County Republican who owns a feed store and who attended O'Malley's news conference, said he strongly favors slots but has some reservations about the House bill of 2005, notably that it did not allow for a slots license at Pimlico Race Course in Baltimore and did not do enough to support horse breeding.

O'Malley's announcement was cheered by members of the horse racing industry, who have been pushing for slots for years as a means to compete with neighboring states where expanded gambling subsidizes purses and breeder incentives.

"Whatever the outcome is with this, at least I have a feeling a good effort is being made," said Dr. Michael Harrison, a veterinarian who works with horses.

O'Malley's announcement left unanswered some key questions about his proposal, including the extent to which he will include money to help mitigate the impact of slots on communities.

One of the few specifics O'Malley did announce yesterday was his commitment to spend $6 million a year on helping problem gamblers. Joanna Franklin, president of the Maryland Council on Problem Gambling, said that's actually about twice as much as the state needs.

At present, the state spends nothing on helping problem gamblers. Franklin said it's impossible to say whether the combination of more treatment money and more opportunities to gamble would do more harm or good. But she said that kind of money would give Maryland the best program in the nation.

"Hells bells, if we got $6 million, my God, we'd have the Rolls-Royce of programs," Franklin said. "We'd be able to have prevention programs in every single school, which nobody does. We'd be able to get true funding for long-term research, which nobody is doing."

At a glance

About 9,500 state-owned slot machines

Projected state revenue of about $550 million a year

$125 million goes to school and university construction, with the rest to the state's general fund

A subsidy for horseracing worth about $100 million a year

$6 million a year to help problem gamblers

[Source: O'Malley administration]

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