Some Md. officials are anything but keen on keno New gambling faulted as cash source

December 06, 1992|By Frank D. Roylance | Frank D. Roylance,Staff Writer Reporters Liz Atwood, Joan Barnes, Donna Boller, Larry Carson, John W. Frece, Marina Sarris, Jackie Powder, Meredith Schlow and William Thompson contributed to this article.

Maryland's new keno game is being ballyhooed as a source o $100 million a year for the state's empty pockets. But that hasn't silenced a chorus of leaders who say expanded gambling is no way to bring in badly needed cash.

The state's lieutenant governor and the mayors of Baltimore and Ocean City are among those who voiced concern last week about keno, which starts Jan. 4.

Gov. William Donald Schaefer hopes the game will help balance the state's budget by offering bar and restaurant customers a new numbers game every five minutes, from 6 a.m. till midnight, seven days a week.

"I can tell you right off the top, it's not going to be welcome in Ocean City," said the resort's mayor, Roland "Fish" Powell. "We're very much opposed to the extension of any kind of gambling."

Lt. Gov. Melvin A. "Mickey" Steinberg called the keno game "ill-directed public policy." Instead, the likely gubernatorial candidate said, "We must reduce the size of government."

Baltimore Mayor Kurt L. Schmoke believes keno "can encourage folks to lose a lot of money very quickly," said his spokesman, Clinton R. Coleman.

The city badly needs state aid, some of which comes from lottery revenue, Mr. Coleman said. But "of the lottery games so far, he [Mr. Schmoke] has the greatest problems with keno. Somebody once said . . . you can't make government strong by the weaknesses of its people."

Another critic of keno is Prince George's County Executive Parris N. Glendening, who said he believes that balancing the budget with lottery money sends the wrong message to Maryland residents, poor people and children.

On Friday, State Del. Leon G. Billings asked U.S. Attorney Richard Bennett to investigate the state's $49 million no-bid keno contract and gambling in general in Maryland.

The keno contract raised eyebrows because the state awarded the job to its lottery vendor, GTECH Corp., without competitive bidding.

"If the state of Maryland is to be the gambling sewer on the East Coast," the Montgomery County Democrat wrote, "I would at least like to know whether those activities are legally conducted, properly procured and sufficiently regulated."

Those who support keno say opponents should offer some other way to close the budget gap.

"Ask them where they want to get the other $50 million or $100 million," said House Speaker R. Clayton Mitchell Jr., a Kent Democrat.

Plagued by the recession and inaccurate revenue projections, state officials have already cut the budget nine times in the past 2 1/2 years, chopping almost $2 billion in programs, dumping hundreds of jobs and reducing health and welfare programs for the poor.

As the keno debate grew louder last week, technicians began installing the video monitors and control boxes in some of the hundreds of bars and restaurants that will offer the electronic lottery game.

Between 200 and 300 applicants, out of as many as 600, have been approved, said Carroll H. Hynson, state lottery spokesman.

The state wants to place the outlets where people gather to "socialize," Mr. Hynson said. That could be any place from a restaurant to a combination gas station and convenience store where people can sit down and eat a hot dog.

Bingo halls and fraternal organizations also may qualify.

He said the agency is looking for upscale players, but will not rule out poor neighborhoods.

"Everyone has the right to participate in this project," he said.

1,000 outlets by June

By Jan. 4, some 600 keno outlets will be up and running, with 400 more to follow by June. Two-thirds are expected to be in the Baltimore and Washington areas.

Businesses granted a keno terminal can expect to net 5 percent of gross sales.

"Most of the people who run good keno locations can sell $10,000 or $12,000 in a week," Mr. Hynson said. "That's about $600 profit in a week, based on average incomes per terminal in other states."

That's fine with existing lottery agents, said Peter G. Samios, president of the Lottery Agents Association.

But members of the Maryland State Licensed Beverage Association, which represents some 1,200 taverns, restaurants and package goods stores statewide, have objected.

Saying they can't staff a keno terminal with a 5 percent return, the members have lobbied for something closer to 20 percent or 25 percent.

Baltimore County Executive Roger B. Hayden washed his hands of the issue. "It's the state's job," he said, to raise the money to solve its budget problems.

"If the game is successful, it will hurt other ventures, and if it isn't, it won't raise the money that's needed," said Baltimore County Council Chairman William A. Howard IV, a 6th District Republican.

Anne Arundel County Executive Robert R. Neall and Howard County Executive Charles I. Ecker voiced concerns about the growth of gambling as a source of public revenue.

Harford County Executive Eileen M. Rehrmann had nothing to say about keno, but Jeffrey D. Wilson, County Council president, said, "The reliance on gambling, including keno, shows the moral poverty of government in America today.

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