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Law would likely boost gambling in bars

February 16, 2000|By SCOTT BUTKI

A proposed tip jar law change supported Wednesday by state lawmakers could result in more people gambling on larger tip jar games, which would make more money available for distribution to charities.

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The proposal was applauded Wednesday by some of the people who would be most affected by the change, including the director of the Washington County Gaming Commission and owners of local liquor stores and bars.

Carmen Harbaugh, who sells tip jars wholesale at Harbaugh Coin Machines in Hagerstown, predicted bar owners would like the proposed change, which the local delegation approved Wednesday.

"I think, honestly, they will be all for it," she said. "They would be grateful."

The delegation still has to vote on other pieces of a broad legislative package to be submitted to the Maryland General Assembly.

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Tavern owners currently keep either $45 profit on each tip jar they sell or 50 percent of the profits before taxes, whichever is lower. Under the proposed change, they would keep 50 percent of the profits, even if the sales were on a more expensive jar.

That could be the incentive bars need to sell the more expensive jars, Harbaugh said.

Under existing law, that incentive isn't there because the profit margin is smaller for the more costly jars, she said.

She predicts her store would sell more expensive jars to bars, which would lead to more money for the Washington County Gaming Commission.

Gene Guessford, who sells tip jars for the Variety Shop in Hagerstown, agreed.

"I think taverns would be buying a lot more bigger ones on account of them keeping half," he said.

"I'd welcome it," John Zombro, owner of Central City Liquor, said of the proposed change.

Customers like the bigger jars because they have larger payouts, but Zombro said he doesn't usually sell those jars because of the profit structure.

May Ellen Pryor, owner of the Short Stop Tavern, said she usually sells one or two $55 tip jars a day. She likes the proposed change, she said.

"It would be for everybody's benefits," she said.

Darrell Sword, owner of the Corner Pub, said he sells about six $90 jars a day. He doesn't sell the larger jars often because it doesn't make sense financially to do so, he said.

He is not sure whether he would sell the $250 or $300 jars, he said.

"The jury is out there. It would be hard to say," he said.

The legislature set up the present tip jar profit rules to discourage people from using the larger jars, he said

Washington County Gaming Commission Director Vanessa Hines said she endorses the change, but expects the impact to be small.

"We will just have to wait and see," she said. "There are a lot of factors."

The change would make accounting easier, said Hines, who noted tip jars come in hundreds of types and sizes.

Clubs, taverns, and liquor store owners sold 25,719 jars in the first quarter of 1999, she said. She did not have more recent numbers, she said.

Clubs keep 85 percent of the profits and give 15 percent to the gaming fund.

The Gaming Commission was created in 1995 to distribute money taxed on the profits of tip jars, a popular numbers game in Western Maryland.

Hines and Commission Chairman Lou Thomas said last week they disliked the plan to change the funding formula because it could cut by about $258,000 a year the amount available for distribution to charities.

The plan would cut by 10 percent the amount of tip jar funds distributed to charities through the Washington County Gaming Commission.

But any effects from that change might be minimized by the proposed change in the tip jar profit rules.

The state plan, developed by members of the local delegation to the Maryland General Assembly, is intended to provide funds to pay down the county's pretreatment debt, offset county water and sewer rates and finance a tourism project such as a minor league baseball stadium for Hagerstown.

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