Maryland gambling revenue soars

Maryland’s bet on casino gambling is paying off, even if it appears to be hurting the state’s lottery sales.

In the fiscal year that ended June 30, traditional lottery revenues in Maryland fell for the first time in 16 years, by 1.9 percent, according to figures released Thursday by the Lottery and Gaming Control Agency. But casino revenues more than tripled, creating a record windfall.

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The state netted nearly $830 million in gambling taxes, an increase of more than 27 percent from the previous fiscal year. The lottery contributed $545 million to the general fund, while the state’s casinos sent $284 million to the Education Trust Fund.

More than three-quarters of the casino tax revenue came from Maryland Live, which opened in June 2012 at the Arundel Mills mall.

Stephen L. Martino, director of the Lottery and Gaming Control Agency, has hired a research firm to prove — or disprove — the hypothesis “that when you open the third-largest [commercial] casino in the United States squarely between your two most heavily populated metropolitan areas, there’s going to be some movement in discretionary gaming dollars from the lottery to the casino.”

Lottery retailers in the vicinity of Maryland Live began reporting declines in keno and instant-ticket sales immediately after it opened, Martino said.

Lottery sales and revenues had increased every fiscal year since 1996. But Martino has been telling state officials for months that the lottery’s 15-year growth streak was about to end as casino revenues exploded.

“Taken as a whole — what we operate and what we regulate — we’re quite pleased with the way the fiscal year ended,” he said. Still, he added, “The fact there was a [lottery] decline is not anything we’re happy about. . . . Is this just a new normal, and we’re going to see a decrease and there’s really not much we can do? Or are there things we can do with our games — how we market them, how they’re played — where we can bring people back where we lost them?”

Maryland is aggressively expanding casino gambling, adding 24-hour operations, live-action table games and more properties. A fifth casino is to open next year in Baltimore, and another is coming in Prince George’s County in 2016. Maryland Live is continuing its own expansion, with a 52-table poker room opening at the end of this month.

The casino already has 180 table games and more than 4,300 slot machines, and business is booming: In July, the first month of the new fiscal year, Maryland Live collected more than $52 million in gross gaming revenue — a 48 percent year-over-year increase.

 
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