For a few hours on Wednesday, Annapolis took a time warp back to 2005. The Senate badly wanted an expansion of gambling, and the governor was on its side. The House of Delegates, facing internal and external pressure to do something on an issue that had consumed the State House for years, agreed to a plan but on terms that its leaders knew nobody involved was willing to accept, and the whole exercise collapsed in a jumble of finger-pointing. If anybody can feel good about the failure this week of the special work group to consider gambling expansion, it's Republican former Gov.Robert L. Ehrlich Jr. He was on the losing side of the 2005 gambling fight, and at least he can now take solace that it wasn't just him; Democratic Gov.Martin O'Malley wasn't able to seal the deal in 2012 either.
It was politics, not policy, that prevented the work group from coming to a consensus on at least some expansion of gambling — specifically, a proposal to legalize table games. But inaction, for the moment, serves the state's best interests. The work group did produce agreement around some ancillary issues that do not need to go before the voters for approval and can be considered during the regular legislative session in January. But the delay by at least two years of a broad expansion of gambling — through the addition of a sixth casino inPrince George's County, the legalization of table games or both — allows time for the state to get some real data on how its gambling program is performing and the size of the market so that it can make an informed decision on how best to proceed.
If the work group had issued a recommendation for a bill that just legalized table games, it almost certainly would have flown through the legislature. But Senate negotiators on the work group would not let that happen. They want a casino in Prince George's County and figure that table games are their best bargaining chip to get it. The broad support for table games in the legislature reflects a general consensus that they would help make the state's program more competitive with neighboring states, which already offer them, and would spark additional employment and economic development, not to mention additional tax revenue. In particular, table games are attractive to Baltimore leaders because officials at Caesars Entertainment Corp., which is the sole bidder for a Baltimore casino, have said they would build a higher-class facility if they could offer table games in addition to slots. That promise was what brought MayorStephanie Rawlings-Blakeon board to a plan for table games and a Prince George's casino.
But aside from political gamesmanship, there's a decent policy reason for not going forward with table games right now. If the state does add a sixth casino in the future (whether in Prince George's or somewhere else), it will almost certainly seek to compensate existing slots operators for the increased competition they would face as a result. Allowing them to offer table games would be one of the best means available to do that. If the state gives casino operators table games now, they would just ask to be compensated again if the state allows a sixth casino, probably with lower tax rates. If the state is eventually going to legalize table games and add a sixth casino, it makes the most sense to do both at the same time.
It's possible that a Prince George's casino is in the state's best interests. The proposal by MGM Resorts for a high-end facility at National Harbor, on the banks of the Potomac just outsideWashington, D.C., is intriguing. It's worth considering in the future, once we have hard data about the performance of Maryland Live and a Baltimore casino.
In the meantime, the legislature can and should move in its next regular session to loosen Maryland's restrictions on hours of operation for its casinos and on their ability to offer free food and drinks. That would make them more competitive with casinos in Delaware, Pennsylvania and West Virginia. It should also shift the responsibility for purchasing slot machines from the state to the casino operators and adjust the state's tax rates accordingly. They can handle that more efficiently and can better align purchases with the market. Finally, the idea of creating a gaming commission so that issues like these can be handled by professionals rather than legislators is promising, but it would require careful consideration to determine what powers it would have.