Gambling on keno

September 22, 1992

It sounds so simple: Institute new lottery-style gambling in Maryland similar to electronic keno and the state earns $50 million this fiscal year and $100 million (or more) in future years. But like all tales involving a pot of gold at the end of the rainbow, this proposal is fraught with peril. It could prove to be a minus for Maryland.

Gov. William Donald Schaefer has been persuaded to implement this plan to help balance the state budget. That is a commendable reason, but not if this game hurts Maryland's racing industry, competes with other lottery games and undercuts the Maryland Stadium Authority.

The game would work this way: You'd go to a restaurant or bar or bowling alley and every five minutes you could wager on a bingo, or keno, game. Pick some numbers, put your money down, and in a matter of minutes the results are flashed on a giant screen. Winners are paid cash right away. And you can place bets 12 times an hour.

This is an enormous expansion of gambling in Maryland. But will it enlarge the total amount of money wagered on state-sponsored games of chance? People may simply bet less on horse races and buy fewer lottery tickets. The video keno action is so fast and the payoffs so immediate that other forms of legalized gambling may suffer. Thus, the net effect for the state treasury may be less than revenue-hungry officials envision.

Most alarming is the potential impact of video gambling on the thoroughbred industry. Race tracks are losing money these days, and any loss of more business to fast-paced keno wagering will only make matters worse. If off-track betting parlors are squeezed even before they are established, this would be a loss to state coffers. OTB was approved this year to prop up the race tracks and make this $1 billion industry more viable. That hope may have been thwarted when the governor announced his Quick Draw plans.

Lottery games are likely to suffer, too. Most troubled could be the instant games that support bonds of the Maryland Stadium Authority. If video keno leads to less lottery revenue for the authority, it could alter future funding plans and raise concerns about the authority's ability to pay off its bonds.

The governor ought to reconsider Quick Draw. To scrap it would create a $50 million hole in his budget plan, but that $50 million was never a sure thing, anyway. Will it decimate horse racing? Will it cause a decline in lottery sales? Will it lead to even more insidious forms of gambling throughout Maryland? Until Mr. Schaefer has more definitive answers to these questions, he should refrain from using Quick Draw and explore other options for raising that extra $50 million.

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