Maryland's legislative black caucus, unhappy with the low representation of blacks among the state lottery vendors, today summoned the lottery's executive director for a public grilling.
Martin M. Puncke, executive director of the Maryland State Lottery, told the legislators that although blacks generate about 38 percent of the state's multimillion-dollar lottery business, they compose only 9 percent of Maryland's lottery ticket vendors, who make a profit off the sales. He blamed the disparity on a paucity of applications by black business owners, but caucus members seemed skeptical of that explanation.
"Deep in your heart, would you like to see more black vendors?" asked Del. Ralph Hughes (D-Baltimore).
"It would be helpful if we had more black terminals, but at the same time I cannot help it if the black terminal applications do not come in to the Lottery Board," said Puncke. "I don't sit up here with a vindictive eye and say I'm going to eliminate black agents. You've got a lot of white-owned businesses in black neighborhoods. I can't do anything about that."
Puncke, whose agency generated $650 million last year if estimates prove to be correct, supplied the caucus with statistics showing that of the top 40 sales areas for lottery tickets, compiled according to zip code, 38.5 percent were in predominantly black neighborhoods and 61.5 percent were in predominantly white neighborhoods.
He said blacks compose about 9 percent of the state's 1,390 vendors, with whites making up 75 percent, Asians 15 percent, and Hispanics 1 percent. Blacks make up about 22 percent of the state population, according to 1980 census figures.
Relations between the lottery agency and black members of the legislature have been cool since the state-run lottery's inception in 1973, caucus members said. Although three blacks sit on the five-member, appointed board that advises the lottery agency, black lawmakers have criticized agency officials for years, saying they have refused to hire enough black employes, to advertise in black neighborhoods with minority-owned firms, or to give blacks what they consider a fair share of vending machines.
Agency officials deny the charges or say they are doing as much as the law or budget allows.
Caucus members also argue that blacks are unfairly singled out as financial risks and required to post extra security bonds before they are allowed to install lottery machines. Agency officials said sound business practices require that any applicant who cannot demonstrate sufficient resources post a bond to cover twice the anticipated weekly receipts. Such a rule is necessary to protect the state against losses from theft, they said. Twelve percent of applicants required to post such bonds last year were black.
Del. Elijah Cummings (D-Baltimore), chairman of the black caucus, said black firms often "don't have a chance to work up a high amount of equity, and then they can't get the machines to generate more resources, and we get involved in a vicious cycle. What we want to do is break that cycle for businesses that have a reasonable amount of success."