150 Turn Out for Bidders' Forum as Deadline Nears

A conference for would-be operators of Maryland's slots parlors attracted about 150 people yesterday at a time when state leaders have grown increasingly worried about whether enough bidders will step forward before a key deadline.

The gathering in Baltimore seemed to offer a hopeful sign for slots boosters, as potential bidders peppered state officials with questions about an application due in just three weeks. But with the economy struggling and financing hard to come by, the slots proponents acknowledged that it is hard to know how many companies will compete to run the five sites authorized by November's referendum -- or whether the legislature might need to rework its initiative to entice more bidders.

"Obviously, because of the economy, we're going to have to look at whatever takes place next month," said House Majority Leader Kumar P. Barve (D-Montgomery). "I don't want to have to revisit any of the work we did, but we can't have our feet stuck in the concrete. What's happening in the economy today is something no one could have predicted a year ago."

The 15,000-machine slots program, the product of a 2007 special legislative session, is projected to yield $660 million a year, primarily for state education programs, within a few years.

Concerns have centered largely on two provisions. One sets aside up to 33 percent of proceeds for the private operators of the slots parlors, among the lowest percentages in the country.

The other, potentially larger, hurdle is a requirement that operators invest $25 million for every 500 machines authorized at a location, which translates into $75 million to $237.5 million, depending on the site. Some state leaders fear that the magnitude of the investment has deterred many bidders unable to borrow money at a reasonable interest rate.

"Obviously, the economy plays a part in who can get financing," said Senate President Thomas V. Mike Miller Jr. (D-Calvert). Miller said in an interview that he remains hopeful multiple bidders will come forward.

Miller said it is possible the legislature will have to revisit the proceed-sharing and financing provisions, although when is unclear. The legislature convenes for its annual 90-day session tomorrow.

Miller suggested that there might be no immediate cure for problems created by the national economy. Moreover, a state commission is not scheduled to pick winning bids until this fall, well after the session ends.

Yesterday's conference, held at the offices of the Maryland State Lottery Agency, which will administer the slots program, drew representatives of several bidders who had expressed interest in one of the five sites, which by law must be located in Baltimore and Allegany, Anne Arundel, Cecil and Worcester counties.

Several officials from the Maryland Jockey Club and its parent company, Magna Entertainment, attended. The financially struggling company has said it will seek a license to operate 4,750 machines at Laurel Park, its racetrack in Anne Arundel.

Also attending were several executives from Penn National Gaming, a company headquartered in Pennsylvania that has expressed interested in the Cecil site.