By Philip Rucker and Jenna Johnson
Washington Post Staff Writers
Wednesday, February 27, 2008
Faced with a proliferation of video gaming machines at bars and restaurants in St. Mary's County and elsewhere, leaders of the Maryland General Assembly said they will introduce emergency legislation today to ban the devices.
Senate President Thomas V. Mike Miller Jr. (D-Calvert) and House Speaker Michael E. Busch (D-Anne Arundel), who have long been sharply divided on whether to legalize slot machines in the state, were united yesterday in condemning video bingo and similar devices, which generate money for private entrepreneurs with no state benefit.
Miller called the devices "counterfeit slot machines" and said they "have sprung up almost like a disease."
Gov. Martin O'Malley (D) will sign the legislation if it comes to his desk, spokesman Rick Abbruzzese said. "The governor thinks Marylanders will have the opportunity to vote on the appropriate levels of slot machines come November," Abbruzzese said.
The November referendum will determine whether slot machines are permitted at five specified locations. Miller has been a leading proponent of legalizing slots as a way to boost the horse racing industry and reap hundreds of millions of dollars a year for the state government.
Yesterday, Miller and Busch said growing numbers of video bingo devices threaten the state's lottery system. The machines have spawned "an underground economy that you don't have any control of," Busch said.
"The expansion of these gambling machines not only goes against the grain of what we tried to accomplish in the [slots] referendum but also seems to cannibalize our lottery system," he said.
Slot machines are illegal in Maryland, but other electronic gaming devices, some of which are designed to resemble slot machines, have been permitted in a few counties if the proceeds go to nonprofit organizations.
The companies that own the machines may take a cut to cover their expenses, as can the owners of the bars or restaurants where they are installed.
The emergency legislation, which would take effect as soon as it is signed into law, would prohibit video poker, electronic bingo and similar machines across the state. A violation would be punishable by up to one year in prison and a maximum fine of $1,000.
The measure would exempt non-electronic bingo used solely by nonprofit organizations if 100 percent of the proceeds goes to charities.
The legislation will be formally introduced today by Sen. Thomas M. Middleton (D-Charles), chairman of the Finance Committee, and Del. Frank S. Turner (D-Howard), chairman of a subcommittee that oversees gaming.
Middleton said he has been inundated with calls from lobbyists in recent days objecting to the measures.
Bruce C. Bereano, a lobbyist who represents a vendor with 80 machines in St. Mary's, said he has not seen the bill but predicted that its passage could "dry up monies given to social causes." Local governments might have to make up the difference, he said.
"The impact statewide is going to be devastating on the charities and nonprofit groups," Bereano said. "I'm sure the only people that are happy about this are the state lotteries. The lottery wants to be the only game in town."
Nonprofit organizations have benefited from the machines in St. Mary's, said County Commissioner Thomas A. Mattingly Sr. (D-Leonardtown).
"People are saying the nonprofits are getting very little of the money. That's not true. They're getting a fair share," said Mattingly, who is a volunteer at the Leonardtown Volunteer Fire Department, which runs five machines.
There are more than 200 instant bingo machines at the Rod 'N' Reel restaurant in Chesapeake Beach. Owner Gerald W. Donovan, who also is the mayor of the Calvert County town, said he is concerned the legislation could hurt his business.
"I don't want to be penalized for having done everything the right way," said Donovan, who been licensed to operate the bingo machines since 1979.
Miller said businesses such as Donovan's that have "played by the rules" will have a longer period of time to adapt to the new prohibition under the legislation.
"But eventually, they're all going to be terminated," he said.
Middleton voted in support of holding the referendum on whether to legalize slot machines. He said proliferation of the video machines could affect the referendum.
"I think people will have such disgust with the proliferation of these slot machines popping up everywhere that they will vote 'no,' " Middleton said.
Although there is no official count, Sheriff Timothy K. Cameron (R) estimates that the number of video bingo devices in St. Mary's has gone from about 150 to almost a thousand in the past month. County deputies started to create a list of the machines yesterday, he said.
"Every time I talk to someone, I hear of another place where these things are," Cameron said.
Comptroller Peter Franchot (D) dispatched a team of auditors to St. Mary's yesterday to determine whether machine operators there have proper documentation and are paying the requisite taxes. On Monday, Franchot called for the machines to be outlawed, saying the cash-only business "is not only ripe for corruption but for tax evasion as well."
Staff writer Christy Goodman contributed to this report.