June 08, 2011
Baltimore mayoral candidate Otis Rolley is out with a list of changes in state slots law he thinks should be enacted before the bidding deadline for the city's casino. But his ideas would only delay the advent of slots in the city and diminish the long-term value of a casino both for Baltimore and for the state.
He has requested that the state slots licensing commission take into consideration a variety of minority hiring and community benefits requirements in evaluating slots bids, all of which should have been raised as issues long ago. But more troubling are his suggestions for changes to state gambling law to allow owners of existing slots licenses to bid on the Baltimore casino; to lower the tax rate to 50 percent, as has been done at Rocky Gap; and to auction the license to the highest bidder.
The first two ideas presume that we need to sweeten the pot to make people interested enough in bidding on the license so that we have competition. The third idea assumes we have so much competition for a license that gambling companies will outbid each other for the privilege of having a license here. That doesn't make much sense.
The first two are also bad ideas for the city and state. Lowering the tax rate for Baltimore is probably not necessary -- there was, after all, a bidder the first time around despite the frozen credit markets at the time and the uncertainty about the land available for a city slots parlor and about the terms the city might try to extract from a developer. All three factors are different this time. Lowering the state's tax rate on the casino would permanently reduce the amount of money available for the state's general fund and would also reduce the amount funneled to Baltimore in local impact fees.
Moreover, creating a lower tax rate for Baltimore than the one assessed on the slots parlor at Arundel Mills, just a few minutes down the Baltimore-Washington Parkway, would be unfair to the Cordish Cos. project that's already underway. Assuming the state law was changed to allow an entity to hold multiple slots licenses, Cordish would almost certainly bid on the Baltimore location, and Penn National, which owns the slots parlor in Perryville and is engaged in a contest with Cordish over regional gambling revenues, would almost certainly follow suit. That would lead whichever company won to place its emphasis on the casino with the lower tax rate to the detriment of an existing facility -- and to the detriment of the taxpayers of the city and state.
What's really most disturbing about Mr. Rolley's ideas is the naivete he displays in suggesting that these legal changes could be enacted without pushing back the schedule for bidding on the city slots site. Unless he is envisioning the governor calling a special session of the legislature within the next couple of days, there is no way it could happen in time. Someone who was chief of staff to a former Baltimore mayor -- and who referred to himself in the news release touting these ideas as "the leading mayoral challenger to the current administration" -- ought to know better.
The only conclusion is that these demands amount to a political ploy -- if the bidding doesn't work out, he can say "I told you so," even though there was no possibility that his ideas could have been implemented. That's hardly becoming of the candidate who's trying to fashion himself as the smart guy in the room.
