City due share of slots money, governor says

Counties where machines are placed would benefit

Ehrlich meets with delegates

He says bill will require role for minority business

January 25, 2003|By Michael Dresser and David Nitkin | Michael Dresser and David Nitkin,SUN STAFF

Gov. Robert L. Ehrlich Jr. told city legislators yesterday that his evolving proposal to install slot machines at Maryland racetracks will include a percentage of the proceeds for Baltimore and the counties where the tracks are located.

Meeting with Baltimore's House delegation, Ehrlich and an aide also assured lawmakers that the administration bill will require participation by minority businesses.

Neither Ehrlich nor Kenneth Masters, his legislative director, provided specifics of the legislation, which Masters called "a work in progress."

The disclosure of the provisions continued the gradual dissemination of details of the much-anticipated legislation, which is expected to be introduced next week. Meanwhile, the administration was backing off revenue numbers it previously had provided to the General Assembly.

The information vacuum about what may be the most contentious issue of the session has heightened nervousness of legislators about what many gambling opponents characterize as a rush to judgment under the pressure of a $1.2 billion budget shortfall.

Del. Peter Franchot said yesterday that he will introduce a bill that would impose a moratorium on the legalization of slots until their impact can be studied by a legislative commission.

The Montgomery County Democrat said his bill, which implements a recommendation from a 1999 study by the National Gambling Commission, is supported by 40 co-sponsors.

"The purpose is really to slow the momentum down on the slots issue, which has expanded dramatically in the last few days," Franchot said. "I was pleased to see the support from the rank-and-file Democrats."

Franchot's bill appeared to address House Speaker Michael E. Busch's concern that lawmakers are being pressed to commit to a major policy change before they have all the facts.

"This issue is not fully thought out," Busch said yesterday. He indicated that legislators might want to close the projected deficit for next year with temporary taxes while studying the impact of slots.

That suggestion puts Busch on a collision course with Ehrlich, Senate President Thomas V. Mike Miller and some members of Busch's Democratic caucus.

"Part of the reason for bringing in slots is resolving a massive deficit," said Ehrlich spokesman Henry Fawell. "To postpone a promising solution doesn't get us any closer to solving that crisis."

One idea that received a warmer response from the Ehrlich camp was a bill introduced this week by Del. Luiz R.S. Simmons, a Montgomery Democrat, to prohibit people or companies involved in the gambling industry from contributing to Maryland candidates.

"The concept is sound," Fawell said. "The governor would obviously have to see the specific legislation before supporting it or not."

The legislative activity came as the administration backed away from an earlier projection that slots would provide $600 million in revenue two years from now - when the state faces another yawning shortfall.

Warren Deschenaux, the chief policy analyst for the Department of Legislative Services, said administration officials had told him that number - predicated on 13,500 slots at three racetracks - was "no longer operative."

In his meeting with city delegates, Ehrlich said slots would bring badly needed redevelopment to Pimlico Race Course.

"It's not a very attractive place to take your date, your family, et cetera," he said.

The governor praised Pimlico's new owner, Magna Entertainment Corp., saying it would turn the aging track into "a sports palace."

Masters told the city delegates that the administration bill would provide a stream of money to City Hall but does not include a mechanism to direct money into the neighborhoods surrounding the track.

"It really is going to be the city's decision," Masters said. "I don't know a mechanism to make sure it goes to a four-block radius."

The three Democratic delegates from the 41st District, which includes Pimlico, said they want to make sure the neighborhoods that feel the greatest impact see the most benefits.

Dels. Nathaniel T. Oaks, Samuel I. "Sandy" Rosenberg and Jill P. Carter are supporting legislation - to be introduced in the Senate by Democratic Sen. Lisa A. Gladden - that would reserve millions of dollars of the proceeds for the neighborhoods closest to Pimlico.

The bill would create a Northwest Gaming Benefits Authority to award funds for projects in the neighborhoods affected by slots. It would require community input and government approval before construction could begin at Pimlico and the hiring of community residents.

"The city can get their piece, but the people in the immediate vicinity must get their share," said Oaks.

During the meeting, Oaks pressed Ehrlich about plans to charge racetracks a $100 million upfront fee for slots licenses, suggesting that the price was too low.

"Nobody seems to be sneezing at that $100 million," Oaks said.

Ehrlich said how much to charge has been a hot topic of discussion within his team. "There is no market," he said. "You're creating a market."

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