It's slots or tough budget cuts, governor to warn Assembly

Reduced proposal due today reportedly seeks 10,500 machines at tracks

January 30, 2003|By Michael Dresser | Michael Dresser,SUN STAFF

Gov. Robert L. Ehrlich Jr. will drop his support for slot machines at Maryland racetracks and impose "painful" budget cuts in the future if the General Assembly doesn't pass the scaled-back gambling legislation he will release today, his chief spokesman said last night.

"It's now or never," said Paul E. Schurick, the governor's communications director. "The fiscal disaster is here and now. It doesn't need to be fixed next year."

In a move that could ease fears of ever-expanding gambling, Schurick also said Ehrlich is ruling out any expansion beyond his slots proposal for as long as he remains in office. Asked whether that was a guarantee, Schurick said, "Absolutely, yes."

The administration's insistence on passing a bill this session came in response to a statement by House Speaker Michael E. Busch yesterday that "slots should be taken off the table for this year." Busch's position was bolstered by the support of most House Democrats for a bill delaying any expansion of gambling for at least a year.

The administration will release the closely guarded details of the governor's slots plan today. A legislative source said the plan will call for 10,500 slot machines at four Maryland tracks - a substantial cut from a 16,000-machine plan Ehrlich aides floated last week.

Ehrlich's response to Busch's statement raises the political stakes in what is shaping up as a down-to-the-wire stare-down with the Democratic-controlled legislature over an almost $1.3 billion shortfall in next year's budget.

"Slot machines don't help next year at all," Schurick said. If the Assembly doesn't approve a bill this year, he said, Ehrlich will eliminate projected future budget shortfalls through spending cuts.

"It'll be painful. It'll hurt the most vulnerable people in the state," Schurick said. "Schoolchildren, drug addicts, these are the people who will pay the price."

Reached at home last night, Busch said Ehrlich's hard-nosed stance could backfire.

"I don't think the citizens of Maryland or the legislature are going to roll over for those types of threats," Busch said. "They didn't send us to Annapolis to avoid honest debate."

W. Minor Carter, a lobbyist working with an anti-slots coalition, said tht Ehrlich's threat will energize those who oppose legalizing slots.

"This is going to fire up all of the opponents," Carter said. "Now we know that if we win today that the battle's over. It's all or nothing. It's for table stakes."

The legislation Ehrlich is expected to propose today is substantially more modest in scope than the 18,000 slots proposed by the horse racing industry. He is also backing off a proposal his aides floated last week for three giant racetrack casinos with 4,500 slots each in Central Maryland.

The revised Ehrlich plan will call for 3,000 slots each at the Pimlico, Laurel and Rosecroft tracks, according to a legislative source. It also calls for 1,500 slots at a track that William Rickman Jr., owner of Delaware Park, plans to build in Allegany County.

Schurick declined to comment on the details of the governor's plan except to say that it would be "as close to the campaign plan as we could make it."

During the campaign, the Ehrlich camp outlined plans for 10,000 slots - 2,500 at each of the four tracks.

The Ehrlich administration's ultimatum to the General Assembly comes amid increasing doubts about whether lawmakers can complete work on slots legislation this year.

At a briefing yesterday, legislative analysts questioned a key component of Ehrlich's plan, saying that the upfront licensing fees the governor plans to use to close a gap in next year's budget could cost the state revenues from racetracks over time.

Pressed by Del. Howard P. Rawlings, chief legislative analyst Warren Deschenaux said that from a long-term financial standpoint "the state would be better off without the upfront money."

Deschenaux and an aide gave a neutral assessment of the benefits and disadvantages of slot machines based on what is known of the governor's proposal. But his presentation closed with an admonition from the 1999 report of the National Gambling Impact Study Commission:

"One of the more damning criticisms of government decision-making in this area is the assertion that governments too often have been focused more on a shortsighted pursuit of revenues than on the long-term impact of their decisions on the public welfare," the panel said.

Del. Peter Franchot said the commission's recommendation of a moratorium on expanded gambling forms the basis of his legislation calling for the issue to be referred to a House-Senate commission for a year's study.

Franchot said last night that 71 Democrats - a majority of House members - had agreed to co-sponsor the bill. Though co-sponsorship doesn't guarantee lawmakers will vote for the measure, it's a sign they're likely to support it.

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