A jackpot for Maryland?

Slots would bring much-needed revenue and good jobs, but projections shouldn't be overstated

August 24, 2008|By James Karmel

The debate over bringing casino-style slot machines to Maryland could use more clear thinking on the true impact of gaming in a community. Anti-slots activists have played up misconceptions about gaming and its community impact, hoping to defeat the slots referendum this November. Meanwhile, slots proponents explain their cause almost entirely in terms of public revenue to be gained from slot taxes - especially for public education - via the 67 percent tax rate that Maryland's system would feature.

While slots casinos in Maryland would bring in much-needed revenue, the casinos also have the potential to offer economic rejuvenation to parts of the state that could really use it. While the Atlantic City model is often derided in Maryland, the casinos there did bring many jobs and opportunities to the region where little opportunity existed before. (The newly prosperous parts of Atlantic County and lively, redeveloped areas of Atlantic City are often not observed by casino visitors.) Many casino jobs pay better than jobs in other businesses. And the multiplier effect of the industry produced one to two jobs in other sectors for every casino position.

While the scale of the Maryland properties would be smaller than an average Atlantic City casino, a facility with 3,000 slot machines would likely require more than 1,000 full-time employees. They would also likely add as many or more jobs around the casino to provide services to the property and for the casino employees needing services in their communities. Many of these jobs require professional skills and pay accordingly in fields such as accounting, security, information technology, restaurant management, legal services, marketing, community relations and human resources. The property taxes alone would bring in millions of dollars annually to the counties where the slots casinos are located.

Certainly, Atlantic City still has problems; the casinos were not a panacea for urban poverty. But southern New Jersey's experience demonstrated that the casino industry can be a positive and productive force, especially if allowed to strategize, invest and promote itself according to marketplace conditions.

Maryland is the wealthiest state in the nation, as measured by median household income. Yet its wealth is not evenly distributed. Somerset, Dorchester, Garrett and Allegany counties (among others) and pockets of Baltimore city have not benefited much from the state's overall prosperity.

Although there are social costs associated with gambling, these would be mitigated in the referendum's companion legislation, which would use casino revenue to develop effective compulsive-gambling treatment for the small percentage of gamblers who may be susceptible. The vast majority of casino patrons gamble recreationally and within their means.

Also, there's no conclusive link between increased crime and casinos, according to the comprehensive 1999 federal National Gambling Impact Study. This is evident in the experience of communities across the mid-Atlantic that opened slots casinos beginning in the mid-1990s, and it is also true for Atlantic City, where crime dropped significantly in the 1990s as the gaming industry expanded.

Finally, there is minimal evidence to suggest that casinos appeal primarily to the working poor. If anything, data show most casino patrons are wealthier than average Americans.

Yet slots proponents also need to be careful about being too specific in their revenue predictions. While casinos would bring millions of dollars in state revenue, expectations may not match projections. Many Maryland slots players will opt for the nearby casinos rather than drive to a neighboring state, but what if Virginia approves casinos, or another state expands its resorts to make them more attractive to Marylanders?

Although some recoil at the idea of full-scale casinos complete with table games, it should be something for Maryland to consider in the future. Gamblers playing table games tend to be younger than slots players, and they are more likely to frequent casino restaurants, bars and clubs, thus bringing in additional revenue for the state and expanding business opportunities and jobs for local residents.

Legislators should carefully monitor this situation and be ready to take the steps to adapt Maryland gaming to ensure the success of the state's industry and the consequent benefits to all Marylanders.

James Karmel is an associate professor of history

at Harford Community College and the author

of "Gambling on the American Dream: Atlantic

City and the Casino Era." His e-mail is

jkarmel@harford.edu.

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