SLOT MACHINE BIDDING

Senate Chief Vents Frustration

By John Wagner
Washington Post Staff Writer
Friday, February 6, 2009

Maryland's Senate president expressed deep frustration yesterday over the weak interest in operating the state's slots venues, saying the bidding process was in "disarray" and calling on a state commission to consider starting it over.

"What we have at the present time is unacceptable," Sen. Thomas V. Mike Miller Jr. (D-Calvert) told reporters yesterday morning. He said he wanted the commission to make suggestions about how to proceed within a week.

By late afternoon, Miller had softened his stance, saying in a statement that the commission should be given time to work with a consultant it has yet to hire to figure out what went wrong "before we consider any legislative revisions to the process."

His statement was largely in line with the views of House leaders, who expressed objections to altering the bidding process after learning of Miller's initial comments. "I think you have to let the process play out," said House Speaker Michael E. Busch (D-Anne Arundel).

The commission charged with evaluating bids announced Tuesday that companies had bid for fewer than half of the 15,000 machines authorized by voters and that two of the six bidders could be disqualified for not paying multimillion-dollar licensing fees.

House Majority Leader Kumar P. Barve (D-Montgomery), a member of the committee that has jurisdiction over slots, said that winning bidders might agree later to install more slot machines, making the program more successful than it appears now.

Lawmakers have envisioned the slots sites as a major source of revenue for the state, eventually yielding more than $600 million a year for education.

If bidders are disqualified for not paying their fees, the state will be left with one each for sites in Baltimore and in Anne Arundel, Cecil and Worcester counties. A fifth site, in Allegany County, drew one bid, from a firm that did not pay the fee and made its interest contingent on the state's letting operators keep a larger share of profits.

The state commission has the authority to reject all bids and to seek new ones. Any changes in revenue-sharing, which Miller and other lawmakers have raised as a possibility, would require the legislature's approval.

Licenses are scheduled to be awarded this fall, and legislative analysts envision slots parlors starting to operate in 2011. Fees would be returned to companies that were not awarded licenses.

Speaking to reporters, Miller, one of the legislature's most vocal slots proponents, expressed particular concerns about the situation in Anne Arundel.

The Maryland Jockey Club, which is attempting to put slots at the Laurel Park racetrack, failed to pay a $28.5 million licensing fee this week. Yesterday, the organization's parent company, Magna Entertainment, said it had placed that amount in escrow at a bank, which the commission said did not meet its requirements.


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