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The Tentacle


March 10, 2003

Ehrlich Must Be Open and Honest On Slots

David 'Kip' Koontz

Gov. Bob Ehrlich found himself in hot water last week for allegedly giving misleading information to legislators and the press about his new slot machine proposal.

At a news conference on Wednesday night the governor presented a chart that purported that schools would get twice what the racetrack owners would get from slots profits.

Under questioning, however, it was disclosed that the governor's plan would actually double the racetrack owners' take to nearly $665 million a year while school funding would be cut approximately 20% - from his original proposal - to $643 million.

Governor Ehrlich's chart also failed to disclose that an extra $350 million would go to track owners to cover their anticipated operating expenses.

It seems both supporters and opponents of the slots were stunned by this apparent budgetary sleight-of-hand.

Senate Budget and Finance Committee Chairman Ulysses Currie (D., Prince George’s), who stood at Governor Ehrlich's side during the news conference, stated he was "livid" after hearing of the governor's apparent "numerical manipulations."

He was quoted as saying he felt "used," and that, "We've got to be honest," and that, "We can't get anyplace by trying to dupe the public."

House Speaker Michael Busch (D., Anne Arundel), an ardent opponent of slots, said after a private briefing from the governor on the plan that he thought the idea presented was a "good one." However, he is now saying the situation had turned "surreal" after hearing the full details from a reporter.

One lobbyist for stopslotsmaryland.com, W. Minor Carter, latched on to the apparent deception to say that it is "very damaging, not only to the bill but to the governor's credibility."

Spokespeople for the governor claimed it was not their intent to "mislead legislators," saying the announcement failed to include operating costs estimated at 28% in the distribution formula. They continued: "We'd be foolish to risk the support that we have in the House and Senate by presenting a misleading proposal."

But isn't that what they did?

Additionally, the bill as presented, slashed one-time licensing fees from $350 million to $120 million, leaving a $230 million funding hole in his budget. He failed to provide any idea what he has in mind to fill that discrepancy.

Governor Ehrlich defended the windfall for track owners as "necessary to get them to 'buy in' to the deal."

The "deal" was crafted with help from the racing industry itself.

With opposition against slots coming from all sides of the political spectrum, from religious leaders to social justice advocates, one would think that, on such a touchy subject, the governor would be able to get his facts straight and in order before going forward with any announcement of a plan, if only to prevent the opposition from gaining more fuel for their fire.

The fact that slots were first proposed as a way to fully fund education is what got many folks on board to support them in the first place.

Very shortly thereafter, however, the purpose of slot money was changed to help cover the overall budgetary shortfall.

However, to promise track owners more than what is slated for schools is bound to raise the ire of some who may have been inclined to support slots.

As it now seems the governor has moved so far from his original intent that no one appears to know what the true beneficiary of the proceeds of slots will actually be, except those folks many were most afraid were going to line their pockets - the track owners.

Governor Ehrlich is to be commended for remaining steadfast in his commitment not to raise taxes, and he seems genuinely sincere in his hopes that there will not need to be deep cuts in program spending or in loss in jobs.

Yet, it seems, he really must, very quickly, ride that learning curve and announce what it is he plans to do to cover budgetary shortfalls, if slots do not pass this session. Oh, but the way, some analysts say it will take up to a year before the state sees any proceeds from slots - except the licensing fees - as there is a period of time it will take to build the facilities in which the slots will be housed.

The most troubling aspect of this latest proposal is actually the reduction in money allocated for education.

Reports during the last two weeks indicate that Governor Ehrlich has been threatening legislators that, if his slots proposal isn’t approved, the Thornton Commission law, passed just last year, will not be funded in FY ’04.

Such a scenario will have a direct and significant impact in Frederick County, as an estimated $6 million of the Board of Education's budget comes directly from the money it is slated to receive in Thornton funding. Those funds - as reflected in the recently approved Frederick County Public Schools FY ’04 budget - are slated, in part, to add new teachers, give raises and fund new schools.

One of the concerns many had during the election campaign was that Rep. Bob Ehrlich did not have direct experience in business, or in municipal management, in dealing with budgets as big as Maryland's -- $22 billion.

Now is not the time, however, for Governor Ehrlich to be feeling his way along in the process, as he was elected in large part because many thought he would be the better person to rectify the budget problem.

Nor is it time for Governor Ehrlich to use slots as a weapon to browbeat legislators into approving a flawed plan that backs away from his promise to use slot money to fund education, when it seems the track owners will be those - as some suggested - who reap the greatest rewards from slots should they be approved.

As this session continues and threatens to extend beyond its allotted 90 days in order to deal with the budget, let us just hope that the best and the brightest minds, and not just those who potentially stand to profit, will be called on by the governor to come up with as many ways possible to deal with this problem, so he can come out of this fulfilling his promises to the people and not just to those he made to his political patrons.

Let us hope, too, that the legislature will work as hard to assist in finding ways to make the best of a bad situation. Now is not the time to place all Marylanders in the muck of a political quagmire.

This can only happen, however, if all options are presented and reviewed with the utmost openness and honesty, for, after all, it is our money and our interests that are at stake - not the interests of the individuals who comprise Maryland's government.



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