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Nov 5, 2008 9:20 pm US/Eastern
Md. Voters Approve Slot Machines
MARYLAND (WJZ/AP) ―
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Maryland voters appear ready to give slot machines a try.
With Maryland facing tough budget challenges, Gov. Martin O'Malley said Wednesday he is moving ahead with plans to put slot machines in place, a day after voters approved legalizing them in a constitutional amendment.
"We move on to those other matters today," O'Malley said, referring to appointments that will need to be made to form a commission on slot machine licensing and to the State Lottery Commission to handle additional oversight.
Pat Warren reports the Maryland Jockey Club announced it will work with state officials to apply for a license at Laurel Park, a horseracing track in Anne Arundel County.
Bids for the five slot machine licenses must be submitted by Feb. 1. An initial license fee of $3 million for each 500 machines will be required, adding up to a total of $90 million. Bids also must include $25 million for construction and related costs for every 500 machines.
The current five-member State Lottery Commission will be nearly doubled with four new appointments. The commission will own and lease the slot machines to the operators.
The governor also will appoint three members to a separate commission granting the licenses, while Senate President Thomas V. Mike Miller and House Speaker Michael Busch will appoint two members each.
O'Malley planned to meet Wednesday with his staff to discuss moving forward, with details "rolling out in the weeks ahead."
"I can tell you that it has always been our intent to move with some speed and to move forward carefully but very deliberately, so that we might realize those revenues as quickly as possible," O'Malley said.
The law requires the Video Lottery Facility Location Commission to consider sealed competitive bids based on various factors. Those include which bids will provide the highest revenue to the state, the extent a proposed location will encourage Maryland gamblers to play in state and the number of jobs a site would create.
The referendum that voters approved allows up to 15,000 slot machines in five locations, with one facility each in Anne Arundel, Cecil and Worcester counties, the city of Baltimore and state-owned property at Rocky Gap State Park in western Maryland.
While the location commission can alter the number of machines at a particular site to adjust to market conditions, no site can have more than 4,750 slots, the number allowed in Anne Arundel County, where Laurel Park is a potential site.
No additional slot machines or types of gambling games can approved without another referendum.
Tom Chuckas, Maryland Jockey Club president and chief operating officer, said approval of the referendum should help keep the Preakness Stakes, the second leg of the Triple Crown, in Baltimore.
"Our focus will now turn to working diligently with state officials on licensing matters," Chuckas said in a statement.
Scott Arceneaux, a senior adviser to Marylanders United to Stop Slots, pointed out that bidders will have a tight timeline and will want to have local zoning issues addressed soon. But he said it was too soon to tell how zoning concerns could play out.
"We're going to see this thing shift to the local level," Arceneaux said.
O'Malley expressed confidence that potential development hurdles would be cleared.
"You cannot build a quality grocery store without there being concerns over zoning and debates over zoning with neighbors, and certainly the road systems in some of these locations will be an issue, and I anticipate that all of those issues will be addressed," O'Malley said.
About half the money raised by slots has been designated for schools, and 33 percent of the proceeds will go to slot machine operators. That's a lower figure than what slot operators get in other states, causing legislative leaders to suggest the amount may need to be revisited to attract bidders.
But O'Malley said he didn't see a need to alter how the money is distributed.
"No change," O'Malley said. "I don't see it."
Comptroller Peter Franchot, a vocal slots opponent, said the referendum's approval won't generate the money needed to fill a budget deficit in the next fiscal year. The state expects a roughly $1 billion shortfall that budget analysts say will continue for the next several fiscal years.
"Whether we were for Question 2 or against Question 2, hopefully we can agree that slots are inconsequential to the difficult decisions that must now be made in the upcoming weeks and months," Franchot said.
It will take several years for slots to be fully implemented and raise an estimated $660 million for the state in fiscal year 2013.
But supporters say that with additional revenue on the horizon, lawmakers could have an easier time tapping into a $740 million Rainy Day Fund to address looming shortfalls without risking the state's Triple A bond rating.
(© 2009 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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