Donald Fry to Head Slots Commission

by: Isaac Smith

Fri Dec 05, 2008 at 12:45 PM EST

On the Victory of Slots

by: Isaac Smith

Fri Nov 07, 2008 at 08:00 AM EST

Question 2 passed, of course, and by a wide margin. If you were viewing the campaign over legalizing slot machines this year as a proxy battle between Peter Franchot and Martin O'Malley, then you'd have to conclude that the Governor won this one big -- enough that Franchot's dreams of challenging O'Malley in 2010, if he ever entertained them, are dashed. O'Malley and the pro-slots coalition had two advantages going into the vote: The wording of the ballot question made it almost entirely about funding education, and opposing that is like opposing puppies and sunshine; and the onset of the economic crisis made people much more anxious about the continued financing of state programs. The exit poll data bears this out: voters concerned about the economy and those with young children were much more likely to support Question 2.

But the slots debate is about more than political brawling; while slots are now a reality in Maryland after many years of debate, the question of how to put slots in place will now come to the fore. Yesterday's Post showed that bidding for slots licenses has already begun:

Before 9 a.m., the Maryland Jockey Club announced its intention to seek a slots license at Laurel Park in Anne Arundel County. Potential bidders for the five sites authorized by voters face an aggressive Feb. 1 deadline to pull together proposals, and no one knows how many will come forward. 

Gov. Martin O'Malley (D) and legislative leaders said they would move briskly to appoint a commission to pick Maryland's slots operators. That is just one of many administrative steps required before slots parlors can open to the public -- and before the state can begin to reap a share of the proceeds.

There's still the question of whether the state will keep the 67% tax rate on slots revenue, as mentioned last week, not to mention the possibility of local attempts to block or limit construction of slots parlors.

Question 2 Results Thread

by: Isaac Smith

Tue Nov 04, 2008 at 06:02 PM EST

9:13 PM: With 1% reporting, the Yes vote has 63%. Not good news for the anti-slots camp: These first precincts seem to be from the 4th and 5th congressional districts, i.e., one of the areas believed to be most against slots.

9:27 PM: With 2% reporting, the Yes vote's lead shrinks to 62%.

9:49 PM: With 16% reporting, the Yes vote is down to 59%.

10:10 PM: Yes vote is holding steady at 59%, with 27% reporting.

10:53 PM: The Sun calls it for the Yes vote; with 42% reporting, it's at 72% (!). Looks like it's an even bigger rout than I or even the Washington Post thought.

2:38 AM: At 94% reporting, the Yes vote is at 58%. So, not a rout, but a definite win for slots.

After the Referendum

by: Isaac Smith

Fri Oct 31, 2008 at 02:05 PM EDT

Both the Post and the Sun have articles today that consider the problems of actually implementing slot machines in Maryland, should the referendum pass Tuesday. For starters, the Post article considers how crime and addiction may or may not rise in areas near slots casinos:

If the experience with slots in neighboring Delaware is any guide, the debate won't end after the votes are counted next week in Maryland.

In the 14 years since Delaware lawmakers legalized slots at three racetracks, the impact has been mixed. The number of calls to the state's gambling-addiction help line has swelled, but law enforcement officials say there has not been the surge in crime predicted by slots opponents.

Meanwhile, the onset of a recession may mean that the state may not be able to attract enough bids on the five proposed casino sites from gambling companies. Then there's the matter of the state's take from slots revenue:

MGM Mirage, one of the biggest brands in the casino industry, said yesterday that it has no interest in bidding on one of the five proposed Maryland casino sites that would be authorized if voters approve a constitutional amendment next week. A big reason: the state's plan to take 67 cents on every dollar collected by the operator, and a requirement of huge upfront investment.

House of Delegates Speaker Michael E. Busch and Senate President Thomas V. Mike Miller said this week that if the ballot question passes, the General Assembly might have to lower the tax rate if not enough attractive bids come in. Their comments underscore the vulnerability of a gambling industry hampered by plummeting consumer spending.

"You might have to go back and adjust," said Busch, suggesting that tax rates could be lowered in jurisdictions that do not receive desirable offers from gambling operators. "I don't think one size fits all."

For his part, Gov. O'Malley is staying firm on the tax rate, for the justifiable reason that slot machines shouldn't primarily enrich the gambling industry, if we're going to have them at all. Perhaps, in this time of economic crisis, Maryland should follow the example of the federal government and just run the casinos itself. Now is the time for Comrades O'Malley, Busch, and Miller to seize the commanding heights of gambling! Or something like that.

My Muddled Thinking on Slots

by: Isaac Smith

Thu Oct 30, 2008 at 01:49 PM EDT

I will freely admit that my opinion on legalizing slot machines has gone all over the place: I was against it at first, for the usual liberal reasons: it's regressive, it encourages gambling addictions, and seems more likely to act as a sop for the racing and casino industry than anything else. Over time, however, I softened up a little, on the grounds that 1) Trying to close the state budget gap through more tax hikes or spending cuts would prove even more politically exhausting than the last go-round, and 2) If there is, as Tom Perez' report on the subject claimed, a steady stream of casino revenue going to other states that could easily be redirected here, then why not? This is why I sympathized with Ike Leggett when he reversed on slots to become a supporter, and with Dan Rodricks, who has displayed a certain ambivalence on the subject: If rejecting slots means making even deeper budget cuts than we'll have to make already, and more tax increases are out of the question, then yes, slots do look attractive. It's also been distressing to see anti-slots groups like Marylanders United argue, self-destructively, against not only slots but against the special session budget package. Such blunt rhetoric is likely to turn off people who are wary of slots, but worried about state programs being slashed.

In the end, however, I think the referendum, as written, won't yield as much revenue as slots advocates believe, due to the time lag involved in building facilities, as well as any lawsuits or local government opposition that would delay construction. Gambling is also a cyclical activity, and will likely underperform for the next few years due to the recession. Gambling also competes with other types of consumption that yield sales tax revenue, to say nothing of the costs associated with gambling addiction and related maladies. In other words, contra the people at For Maryland For Our Future, it's not a free lunch.

At the same time, it's not nothing, either, and the search for a seemingly easy source of revenue won't end if Question 2 is defeated. But neither will it end if it passes. Gov. O'Malley, Comptroller Franchot, and the General Assembly will have to make tough decisions about what to cut and what to save in either case; the only difference will be whether Marylanders choose, essentially, between a larger budget deficit to close, or a smaller deficit with a set of new problems related to legalized slot machines. Given that dilemma, I say we go with the simpler one. Vote No on Question 2.

Baltimore City Paper: No on Slots

by: Isaac Smith

Thu Oct 30, 2008 at 02:07 AM EDT

The Only Paper That Matters weighs in on the referendum:

City Paper urges you to vote no on Question 2. While the state faces a financial deficit that is likely going to make life in the Land of Pleasant Living somewhat less pleasant in the immediate future, "easy money" doesn't seem like a responsible answer. Indeed, the state, and the country, have arrived at their current financial straits in part thanks to the sort of thinking that underpins legalizing slots: take money from those credulous enough to let it be taken; reap rewards now and worry about costs later; faced with belt-tightening, shop for new pants.

Schools need proper funding, and there is an existing solution for that, an almost forgotten relic of an earlier age: tax revenue, the result of paying one's fair share for privileges as a citizen and the common good. And although horse racing is a significant part of the state's self-image and economy, if it can't survive unless propped up by the coins of hordes of plastic-cup-clutching slots players with no interest in horseflesh, is it truly viable? Perhaps most importantly, while slots are unlikely to wreck the state if Question 2 passes, the expansion of legal gambling is unlikely to stop there. This is not to say that slots, once done, can't be undone; slots have already come and gone in Maryland once. But we face the possibility of opening ourselves up to a hard-to-reverse new set of complications and possible pitfalls that can be avoided. Let's avoid them.

Slots Poll

by: Eric Luedtke

Tue Oct 21, 2008 at 05:16 PM EDT

How Close Will You Live to Slots?

by: Eric Luedtke

Sun Oct 19, 2008 at 12:09 PM EDT

Thoughts From the Teachers Convention

by: Eric Luedtke

Sun Oct 19, 2008 at 11:46 AM EDT

Just got back last night from Ocean City, where I was at the convention of the Maryland State Teachers Association (soon to be the Maryland State Education Association). I actually had a good time this year, as opposed to last year when I basically got called stupid on the floor of the convention by a member of the MSTA board. It probably helped that I didn't really get up and say anything this time.

Anyway, lots of political speeches. Martin O'Malley, who I'll come back to in a second. Dennis van Roekel, who is the new President of the NEA, and who always gives a good speech. Frank Kratovil, who did an incredible job of contrasting himself with crazy Andy Harris, and who definitely has the strong support of teachers. The Maryland State Teacher of the Year, William Thomas, who gave probably the best speech of the entire convention, tying the success of teachers and their associations to the success of our public schools. And then the normal speeches from MSTA President Clara Floyd and Executive Director David Helfman.

Anyway, so O'Malley. Whoever wrote the speech for him did a spectacular job. I mean, just incredible. It was the sort of prose you'd expect in a Presidential speech - that is, as soon as we get a President who knows how to speak. But his delivery was a little off, unfortunately, which meant that the great writing translated into a decidedly mediocre speech. He looked tired, quite frankly. And I can understand that. It's been a tough year what with the budget being in a constant downward spiral. Though, I have to tell you, O'Malley's sticking up for education in the recent budget cuts has definitely warmed me up to him again.

I think he was hoping for a little bit of a pick-me-up from the teachers. In the middle section of his speech, he turned to a sort of full-throated advocacy for the slots referendum that we really haven't seen too often. And. It. Bombed. I mean, there was a smattering of polite applause in spots. But it felt like he was looking for a standing ovation, and he certainly didn't get it. There are still some raw nerves from the process MSTA used to decide to support the referendum. And leadership has done nothing to address that, ruling anything related to it out of order at this convention. I think people are tired of the issue, and bitter, though it'll almost certainly be a factor in the leadership elections happening this spring. But O'Malley carried on, regardless.

If youre interested, MSTA has again posted blogs from a number of attendees on their website, though some of them are decidedly better than others.

Ehrlich Opposes Slots Referendum

by: Eric Luedtke

Sun Sep 28, 2008 at 09:22 AM EDT