As budget challenges persist, Prince George’s rethinks casino gambling

August 7, 2011

Rosecroft Raceway, the storied horse track in Prince George’s County that closed last summer, could reopen as soon as next week. And already, the new owners are plotting its next chapter: as the site of one of Maryland’s largest casinos.

Located just off the Beltway in Fort Washington, the track is better positioned than any of the five sites that Maryland has authorized to attract patrons from the District and Northern Virginia, where casino-style gaming remains illegal.

Until now, Prince George’s politicians have refused to host a gaming site, citing concerns about slot machines preying on the poor and increasing crime. But that resistance is starting to crack.

With the promise of millions of dollars in proceeds to bolster the recession-battered budgets of host counties as well as the state, some Prince George’s leaders say it’s time to be more accommodating.

“My personal view is, if we can have gaming across Maryland, why not have it in Prince George’s County, so we can benefit from the proceeds also?” said Del. Carolyn J.B. Howard (D-Prince George’s), a former chairwoman of the county’s House delegation in Annapolis. “Times do change.”

The county is the latest in a string of communities across the country to give gambling another look in the face of challenging budget outlooks. Its new executive, Rushern L. Baker III (D), who inherited a $77 million budget deficit from his predecessor, has big plans for Prince George’s, including a new $600 million hospital system, which could benefit from gambling proceeds.

Penn National Gaming, which bought Rosecroft at a bankruptcy auction in January, plans to reopen the facility as early as Aug. 18 for betting on simulcasts of races from other harness tracks across the United States. The Pennsylvania-based company is angling to settle a legal dispute that also would allow it to restore betting on off-site thoroughbred races. And the first season of live racing at Rosecroft since 2008 is to start this fall.

But for the track to make money, company representatives say they will need to usher in casino-style gambling, offering slot machines, tables games or, preferably, both. For now, Penn National has committed to running live races for only two years.

“Long term, it’s going to be pretty difficult without some sort of gaming,” said Christopher McErlean, Penn National’s vice president for racing. “We’ve been pretty upfront about that.”

Putting either slots or table games at Rosecroft would require action by the General Assembly and approval of a statewide ballot measure. Penn National is gearing up for a big lobbying push in the legislative session that begins in January in hopes of having the issue before voters in November 2012.

It is not expected to be an easy sell. But among those who say they are keeping an open mind is Baker, whose position will be pivotal for legislative leaders and members of the county’s delegation in Annapolis.

“Rosecroft can happen, but it’s going to take hard work and expending political capital on the part of the county executive,” said Senate President Thomas V. Mike Miller Jr. (D-Calvert), whose district includes part of Prince George’s. “What he needs to say is, ‘I’m for Rosecroft. Let’s get this done.’ ”

In an interview, Baker said that he does not want to see Rosecroft close againand that he is gauging the views of the surrounding community.

“What is the impact on public safety? What is the impact on public infrastructure? How much is the state willing to give us to incur these things?” Baker said, when asked for factors that he is weighing. “My first and foremost concern is what Prince George’s County will get out of this, whether you’re talking about card games or slots. The sooner we can answer the question, whether we are going to move forward with some sort of gaming at Rosecroft, the better.”

Eric Smith, vice president of the Henson Valley Civic Association, which represents 385 homeowners near the track, said he has seen a shift in residents’ attitudes.

“In the beginning, most of the folks did not want slots,” Smith said. “But there are so many other places that are opening up. The way the economy is now, we need to keep as much money in the community as possible.”

Residents remain concerned about an increase in littering and traffic that casino-style gambling could bring. But at a recent meeting, about three-quarters of those there raised their hands when asked whether they would be okay with slots, Smith said.

To bolster its case, Penn National has commissioned an economics professor from Bowie State University to conduct a study of the potential jobs and revenue that a Rosecroft casino would generate. It is expected to be released in a few weeks.

Under one scenario, Penn National would demolish the existing grandstand at Rosecroft and build a casino alongside the track that would be similar in size to one now being built at an outlet mall in Anne Arundel County. That facility, with a planned 4,750 slot machines, is envisioned as Maryland’s largest. After several setbacks, its opening is scheduled for next year.

Once fully operational, that casino is projected to generate more than $500 million a year in revenue, with more than $240 million of it going to the state and $27.5 million to the county. The Anne Arundel share was the chief reason cited by County Executive John R. Leopold (R), a former slots opponent, for backing the project.

Baltimore officials have also come around to the idea of a casino there, persuaded in part by the promise of revenue that can be used to lower the city’s high property tax rate. Two smaller slots sites are operating, in Cecil and Worcester counties; another is planned for Allegany.

In Prince George’s, Baker and Miller said that part of the proceeds from casino-style gambling could be used to help fund a revitalized hospital system.

Gov. Martin O’Malley (D), who has been unenthusiastic about expanding Maryland’s gambling program, said Friday that he would continue to be “very mindful” of the views of the Prince George’s executive and county delegation.

Casino supporters have plenty of work ahead if they are to make their case before legislators return.

Last year, Miller and Sen. C. Anthony Muse (D-Prince George’s) pushed a bill through the Maryland Senate that would have allowed gambling on card games — but not slot machines — at Rosecroft. That bill went nowhere in the House.

Muse, a minister whose district includes Rosecroft, said he would still prefer to legalize only card games. But, he added, “I am definitely open to exploring every possibility.”

Card games, such as blackjack and poker, produce more jobs than slots, and they tend to attract a higher-end clientele. But slots are far more lucrative for casinos, because they don’t require the same amount of labor to operate.

Karen Bailey, a Penn National spokeswoman, confirmed that the company’s preference is to include slots at Rosecroft.

The willingness of the House to add a Prince George’s gambling site is the biggest unknown.

House Speaker Michael E. Busch (D-Anne Arundel) said he expects debate to “center around” the desires of Baker. He also said that a proposal is certain to draw opposition from previously approved slots operators, who would lose some business.

Del. Melony G. Griffith (D-Prince George’s), chairwoman of the county’s House delegation, said that she had not polled her members but that their views are mixed. She said she is concerned about the “addictive” nature of slot machines.

Some delegates are rethinking their views, however.

“At this point, I’m open to the idea,” said Dereck E. Davis (D-Prince George’s), chairman of the House Economic Matters Committee. “I was a flat ‘no.’ The fact of the matter is, we’re in a very different economy. I think it would be irresponsible of me not to consider the idea.”

“We need to keep as much money in the community as possible.”

Eric Smith, vice president of the Henson Valley Civic Association, which represents 385 homeowners near Rosecroft Raceway

John Wagner has covered Maryland government and politics for The Post since 2004.
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