Unfazed by foes, state is gearing up for keno

December 20, 1992|By Eric Siegel | Eric Siegel,Staff Writer

As opponents have been striving to block or delay keno gambling in Maryland, the State Lottery Agency has been working with the same determination to get the game running by the announced Jan. 4 start-up date.

Out in the field, technicians were hurriedly installing terminals and monitors at dozens of locations last week, while bartenders and others who are to operate the game were being shepherded through 1 1/2 -hour training sessions.

Meanwhile, at lottery headquarters, officials were rushing to approve still more outlets, suspending normal procedures and faxing orders for necessary new equipment.

This flurry of last-minute activity follows an intensive door-to-door campaign by lottery field representatives to get upscale bars, restaurants and bowling alleys to apply to be keno agents.

In some cases, lottery representatives pitched the game by suggesting that businesses would lose customers without it.

In others, they intimated that existing lottery outlets could lose their franchises if they didn't agree to carry keno, tavern and restaurant owners say.

Lottery representatives even took completed applications to some prospective keno operators so all they would have to do was sign, lottery officials acknowledge.

"We went out with the idea we had to be expedient," lottery sales manager Joseph B. Jason said last week.

Another lottery official, marketing services manager Michael E. Williams, said the lottery had to be "very aggressive" to have licensed 435 new locations since the end of September, when it was told to get ready to launch the electronic bingo-like game by early January.

The agency normally licenses no more than 20 or 30 new locations a month.

In its rush to get new businesses set up for keno, the lottery has forgone the criminal background security checks it normally runs before licensing new applicants.

Because of that, officials have made approval contingent on passing a later check by the agency's two-person security staff. Officials said they would immediately rescind the licenses of any new agent found to have a criminal conviction other than a traffic offense. But they said they expect "very few" new outlets to fail the security check, because most are bars and restaurants that have already been licensed by local liquor boards.

The lottery agency also has put off notifying keno applicants it plans to reject because it doesn't want to get bogged down by possible appeals. Instead, officials have been concentrating on informing approved out lets of their selection.

"All of our efforts are going to getting this game off and running," Mr. Williams said.

As of Friday, the lottery, which began soliciting keno applications three months ago, had approved 793 locations around the state to carry the computer-generated numbers game -- the 435 new outlets and 358 existing agents. The game features a winner every five minutes, and payoffs ranging from $2 to $100,000 will return 56 cents of each dollar bet to the players, slightly higher than that of other lottery games.

There are at least a couple of approved outlets in every jurisdiction in the state, but the bulk -- more than 450 -- are in Baltimore, Montgomery and Prince George's counties and Baltimore city.

By Jan. 4, officials said, 600 locations will be set up for keno -- 400 of which now sell lottery tickets. The initial locales are heavily weighted toward existing outlets because the only new equipment they need to run keno is a 20- or 25-inch computer monitor.

In contrast, first-time lottery outlets must also be equipped with lottery computer terminals and special telephone lines. The cost of the latter is borne by the lottery agency and runs about $400 per location, officials said.

Plans call for the lottery agency to have 1,000 outlets in operation by the end of January and 1,800 by June.

A storm of criticism

Keno has generated a torrent of criticism from public officials who are concerned about the spread of gambling and upset by the award of the 3 1/2 -year, $49 million contract for the game to GTECH Corp., the existing lottery operator, without competitive bidding.

Gov. William Donald Schaefer, who proposed the initiation of the game in September as part of a plan to address a $450 million budget shortfall, has defended it as the only practical means to ++ avoid further drastic cuts in social programs. The state hopes to net about $50 million, from a projected $155 million in keno sales, in the first six months of 1993.

The controversy is causing at least one new location that has already received lottery agency approval to reconsider whether to offer the game.

"Whether we do it depends on what happens in the next few weeks," said Ken Nohe, owner of the White Marsh Dinner Theatre. "If it comes to have a negative connotation, I wouldn't want to have anything to do with it."

Not all the locations that applied to be keno outlets support the game.

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