In August, a special session of the Maryland State Legislature convened for the sole purpose of considering legislation to expand gambling. Prior to the special session, Governor Martin O’Malley (D) announced the proposal would increase state revenue by $100 million in the next budget year alone — long before the construction of a new casino in Prince George’s County that was part of the proposed legislation.
A bill passed, but opponents of expanded gambling petitioned the new law to the general election ballot. Thus, on Election Day, voters in Maryland will vote on “Question 7: Gaming Expansion Referendum.”
The referendum reads: “Do you favor the expansion of commercial gaming in the State of Maryland for the primary purpose of raising revenue for education to authorize video lottery operation licensees to operate ‘table games’ as defined by law; to increase from 15,000 to 16,500 the maximum number of video lottery terminals that may be operated in the State and allow a video lottery facility to operate in Prince George’s County?”
Never has a ballot question battle been fought so vociferously, nor have any two sides to date been so flush with cash and so willing to throw money, by the tens of millions, into a battle. Yet for many voters, with little time left to decide, the issue is murky.
In reports filed Oct. 12 with the Maryland State Board of Elections, the parties involved on both sides in the war over Question 7 — mostly national gambling interests — had spent over $47 million in the ad campaign.
They weren’t done, either.
Pro-Question 7 is the ballot-issue committee identified as “For Maryland Jobs and Schools/Vote for 7” (www.votefor7.com).
The committee is largely funded by MGM Resorts International of Las Vegas. MGM Resorts wants to build an $800 million casino at National Harbor in Oxon Hill, Md. While others may compete to build the casino, Prince George’s County observers say MGM is favored to get the deal.
Benefits for Maryland promised by the “Vote for 7” group include the creation of 10,000 permanent jobs and 2,000 construction jobs. Also, the group promises an annual $199 million in “new funding” for Maryland schools — money that will be kept “safe” through independent audits and a ban on political contributions from casino owners.
On the other side of the paid-for media battle, “Get the Facts/Vote No on 7” (www.votenoon7.com) is a ballot-issue committee largely funded by Penn National Gaming of Wyomissing, Pa. Penn National owns Hollywood Casino in Perryville, Md., Rosecroft raceway in Fort Washington, Md., and Hollywood Casino at Charles Town, W.Va.
Some of the “No on 7” arguments include the criticism that the state enacted deep tax cuts for casino operators shortly after raising taxes on “working families” (making over $150,000).
“No on 7” also claims that there is no evidence that more jobs for Maryland will come of approving Question 7.
“No on 7’s” website has also raised the specter of corruption, alleging there were many private meetings involving top legislators and present and potential casino operators during the process of hammering out a bill.
(The “transparency” question has been raised in many other quarters as well. Had the gambling law been approved in a regular legislative session, rather than a special session, voters would have been able to know at the time of the debate what officials had received in contributions from national gambling interests.)
The language in the question, “for the primary purpose of raising revenue for education,” is the subject of debate. While the language give the impression Question 7 will benefit students, experts agree that there is no guarantee that overall funding for schools will increase. Under the state’s constitution, the governor and General Assembly have the flexibility to move money between special funds and the general budget each year.
Today, old and new “information” on the pros and cons of Question 7 continues to flow in a torrent from supporters and opponents, newspapers, television, radio and ads of every ilk. Recent studies are being touted, including one by the Sage Policy Group (funded by the proponents of 7) that warns of millions of lost revenue to other states and casinos if expanded gambling is not approved. Another, by the nonprofit Maryland Public Policy Institute, “An Economic Analysis of the Proposed Expansion of Gaming in Maryland,” examines the referendum in a political and economic context and concludes, among other things, that projected revenues from the National Harbor Casino are exaggerated — but a financial link has been found between the study and the “No on 7” committee.
Despite the support for Question 7 of Governor O’Malley and a variety of other leaders in his own party, Peter Franchot, Maryland’s outspoken state comptroller, is a critic of Question 7.
On the eve of the August special legislative session, Franchot sent a letter to the governor and the legislature urging them first to voluntarily disclose all contributions from national gambling interests including “all of your personal and affiliated (campaign) committees” and to vote no on expanding gambling in the state.
He added historical perspective: “Even if voters were to approve a new Prince George’s County casino this November, it will be several more years before that casino is built, open for business and generating revenue for the state of Maryland.
“To this point, it is worth noting that nearly four years after the voters approved slots parlors at five locations, only three, to date, exist. … As of June 30, those three had combined to generate about $200 million for the state of Maryland (source: http://slots.mdlottery.com/) — not nearly enough to cover the $267 million that we have spent to purchase and lease the slot machines for the casino operators.”
He also mentioned that MGM failed to meet New Jersey’s standards for corporate integrity because of ties to organized crime in China. (The entire letter is available at (http://www.franchot.com/issues. Click on “slots.”)
In a more recent statement, Franchot charged, “Any modest revenues that will result from this new MGM casino will be offset to a large extent by the deep tax cuts that have been awarded by the legislature to MGM’s in-state competitors.”
Pundits say the outcome of this ballot question is as predictable as a coin toss.
Many voters have yet to decide. However, Frederick resident Jim McCoy, a retired professional government worker has made up his mind on “7.” “If it passes, it will create over 12,000 jobs for Maryland, and it will mean $200 million a year more in funding for Maryland,” said McCoy.
McCoy noted that in the last decade, Maryland residents spent $1.2 billion just at the casino in Charles Town, W.Va. If Question 7 fails, “Maryland will lose another $1.1 to $1.5 billion just to Charles Town over the next 10 years.” As much as possible, money spent gambling by Marylanders should stay in Maryland, not go to West Virginia, Pennsylvania or Delaware, said McCoy.
Frederick City resident, independent network marketer and voter Tom Callanan was undecided but leaning toward a “yes’ on expanded gaming at the time of the Courier interview.
“At first I thought it would be a good thing. It seemed the table games would bring jobs — and money spent of gambling would not be leaving the state,” said Callanan. “Now there is information that the casinos might be bringing their own people in [and not hire Maryland residents]. We hear also that the money might not be earmarked for education. Also, I hate to see the money made off poor people.
“On the other hand, I don’t want to see the money going out-of-state. … It’s a tough call. I am still open to new information. I may not decide until election day.”
Tex Lanier is a personal financial manager and Villages of Urbana resident. He said he is undecided but leaning toward yes on “7.”
Lanier mentioned that he had read Petula Dvorak’s column in the Oct. 16 Washington Post: “Addiction is a sure-fire winner if Maryland expands gambling.” The column troubled him.
“The clinical evidence shows that the percentage of adults addicted to gambling are two to three times as high in places within 50 miles of a casino,” he said. “I’m still undecided. I’ll probably end up voting for it, but I’ll be holding my nose.”
No matter how Marylanders vote on the issue, it’s clear Question 7 will be remembered as a very murky place on the Nov. 6 ballot.