Chesapeake Beach Weighs Proposal That Would Raise Tax on Bingo Machines
Sunday, May 10, 2009
The Chesapeake Beach Town Council is considering raising a tax related to instant bingo machines by next fiscal year.
Council member Pat Mahoney suggested during a budget work session Thursday that the town increase its tax on admissions and amusement from 0.5 percent to 0.75 percent of gross receipts.
The proposal follows the Maryland General Assembly's move this year to increase the state's admissions and amusement tax from 20 to 30 percent of net proceeds, which will bring in an estimated $10.5 million. The increase was included in legislation that extended the use of the instant bingo machines at three locations in Chesapeake Beach and a few Anne Arundel County establishments until 2012.
Freshman council member Ingrid Lamb said the town was getting "a pittance" from its admissions and amusement tax, while the state is reaping the rewards.
"We're getting chicken feed here," Lamb said. "We're getting chicken droppings, really."
Lamb suggested that the council make a motion to raise the town's admissions and amusement tax before the budget's official introduction in a few weeks.
A .75 percent tax in Chesapeake Beach would bring $750,000 into the town, which could be used for one-time expenditures or the rainy-day fund, officials said.
"This is a temporary boost," council member Bob Carpenter said, "because in three years, [the machines] may not be there."
The new state law prohibits any county from increasing fees on the machines, and it prohibits any municipality or county from increasing taxes on the net proceeds, which might allow the Chesapeake Beach Town Council's proposal targeting gross receipts to slip by, according to the Office of the Maryland Attorney General.
"They clearly can't raise the tax on the net," said Assistant Attorney General Kathryn M. Rowe. "I have to believe whoever wrote this [state] amendment thought they were capping the [local] admissions and amusements tax. It is an interesting issue, because there is this piece left . . . and it doesn't say they can't raise the tax."
Mayor Bruce A. Wahl said the matter will be further reviewed by the town's attorney and discussed by the council.
Town Council members also were not pleased that similar electronic bingo machines at Crooked I Sports Bar and Grill do not fall under the same category as the pull-tab instant bingo machines at establishments such as the Rod 'n' Reel Restaurant. The distinction is in the design of the machines, council member Stewart B. Cumbo said.
The pull-tab machines have a paper roll of predetermined outcomes for myriad games, similar to the individual pull-tab gaming cards. The electronic bingo machines require a caller to call individual games and load the results into the machines, which Crooked I has, said Calvert County State's Attorney Laura L. Martin.