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The state eyes tip jar cash

February 17, 2005|by BOB MAGINNIS

In December 1997, after The Associated Press reported that Washington County residents had wagered $61.3 million on tip jars in the previous fiscal year, a Herald-Mail editorial warned that if state officials in Annapolis saw that item, sooner or later they'd try to get their hands on some of that cash.

Welcome to "later." After a 2004 attempt to add language to the slot-machine legalization bill, the House Ways and Means Committee this year has written a new bill that would put tip-jar operations under the state comptroller's office.

The bill would require all tip jar operators to provide the state with lots of data on gross revenues and expenses. It would also require the comptroller to report annually and certify that groups running tip-jar operations were in fact bona fide charitable organizations.

Last year state Sen. Don Munson, R-Washington, introduced an amendment to keep tip-jar language out of the slots bill, but according to County Commissioner William Wivell, this year that won't be enough.

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Wivell said that based on advice from the Maryland Association of Counties, the best the county can hope for is to amend the bill.

On Wednesday, a Ways and Means Committee staffer said that because slot-bill hearings are being held this week, no one could respond immediately on what concerns prompted introduction of HB 212.

Whatever they were, a reduction in the amount of charitable revenue would be a problem for local charities and the fire/rescue companies.

By law the fire/rescue companies get 50 percent of the money. Their share amounted to $1.4 million last year, according to James Hovis, Washington County Gaming Director.

In the last fiscal year's distribution, 101 local organizations and the fire-rescue companies, got $2.8 million, Hovis said.

Recipients included the Community Free Clinic, which provides medical care to the uninsured. CFC, which moved to a new location on Hagerstown's Mill Street, received $165,000.

To raise that money, 92,652 tip jars were sold and $72.7 million was wagered. In answer to my question, Hovis said that most of the money wagered goes back to the players.

How much exactly is difficult to determine, he said, because different types of jars vary in the the amounts they pay out.

But when I asked Hovis whether the bill would preclude taverns, liquor stores and restaurants from receiving a share of the proceeds because they're not charities, he said "That's unclear."

If that's true - and it's uncertain now - that would overturn the arrangement worked out years ago that allowed revenue to be shared with private businesses that had argued that private clubs were using tip-jar revenues to undercut for-profit establishments' prices.

The for-profit businesses still don't have the revenue advantage the clubs do.

"For example, if a for-profit bar makes $100 on a jar, (the gaming office) receives $50 of that. If a club makes $100 on a jar, we receive $15," Hovis said.

Hovis stressed that his office is not taking a position on the bill. That's up to the County Commissioners, he said.

Tom Altman, president of the Washington County Volunteer Fire & Rescue Association, said Wednesday his group and the State Firemen's Association oppose the bill, in part because of the additional paperwork that would be required.

Then there's the loss of revenue, Altman said.

"Everyone has got to assume that if the state gets involved in this, a share is going back to Annapolis for redistribution," he said.

In a presentation to the County Commissioners this week, the association said county fire/rescue companies have "critical" funding issues.

There is a limit, association officers said, to how many fund-raisers can be held to cover the increasing costs for training, apparatus and fuel.

Companies could bill for service, but if they do, the officers said some senior citizens on fixed incomes may hesitate to call for the help they need.

I've never been an enthusiastic player of tip jars, but in one way they're superior to slot machines. They're not as mesmerizing as the slots are.

You can talk to friends or even eat a meal as you unwrap the tickets, knowing as you play that you're helping local charities as opposed to some big gaming conglomerate.

It may be impossible to kill this bill, but I hope our state lawmakers can somehow ensure that whatever happens, it won't be the volunteers who risk their lives and those served by nonprofits who get shortchanged.

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