Ehrlich appeals for slots

March 31, 2004|by LAURA ERNDE

ANNAPOLIS - With less than two weeks to go in the legislative session, Gov. Robert Ehrlich on Tuesday implored a House panel to approve slot machines to prevent drastic cuts to health and human service programs next year and to save Maryland's horse racing industry.

With Maryland facing a projected budget gap of $800 million next year, the state "desperately needs a new funding source," Budget Secretary James "Chip" DiPaula told the House Ways and Means Committee.

Ehrlich promised to make education spending increases mandated by the Thornton plan that the legislature passed two years ago.

Since health and human services make up much of the rest of the state budget, those are the areas that likely would be cut next year if slot machines aren't approved, he said.


The Ways and Means Committee could approve a slots bill later this week, but it's likely to differ from the slots bill the Senate passed last month.

Committee Chairwoman Sheila E. Hixson said slots must be combined with tax increases to solve the state's long-term budget woes.

"We see slots and revenues as a compromise situation," said Hixson, D-Montgomery.

The House has approved a $670 million tax package that would increase the sales tax from 5 percent to 6 percent and impose a five-year income tax surcharge on high earners.

If the House also passes slots, the tax and slots issues would be hashed out by 10 lawmakers in a conference committee in the waning days of the session, which ends April 12.

If the conference committee cannot agree, the legislature would pass the fiscal 2005 budget, which is balanced, putting off dealing with the state's problems for another year.

"Without taxes and without slots, there is a huge hole," said Del. Robert A. McKee, R-Washington, who is on the Ways and Means Committee.

McKee said he believes slots have a better shot at passing than the tax package, which passed the House by a slim margin.

Del. LeRoy E. Myers Jr., R-Allegany/Washington, also a member of the committee, said he will vote against slots, in part because of the social costs, which were illustrated last week when Washington County's former tourism director admitted in court to a gambling problem.

Ben Hart pleaded guilty to stealing more than $15,000 from the Hagerstown-Washington County Convention and Visitors Bureau.

Other members of the committee questioned whether revenue from slots would be enough to pay for the $1.3 billion Thornton plan.

It is estimated that slots would bring in about $800 million a year when all 15,500 machines in the Senate plan were up and running.

DiPaula said spending cuts have freed up $500 million for the plan and slots would constitute 97 percent of the remaining commitment.

Earlier in the day, pro-slots forces rallied outside the State House carrying signs saying "Yes! Slots. No! New Taxes."

Ehrlich stressed the need to have a slots plan that helps the horse racing industry just as slots have boosted that industry in West Virginia and Delaware. "We're here today because there is no tomorrow," he said.

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