Our View: Report Signals that O'Malley Will Push for Slots

The new report on racetrack slot machines, issued by state Labor, Licensing and Regulation Secretary Thomas Perez, doesn't present any new arguments. It won't change any minds - and probably wasn't intended to.

What's significant is that this report is coming from the O'Malley administration at this time.

During last year's campaign, Martin O'Malley made it clear that he supports bringing in slot machines to prop up the state's ailing racing industry. But Mr. O'Malley kept his distance from the issue during his first General Assembly session, having seen his predecessor, Robert Ehrlich Jr., come to grief by immediately pushing a hastily constructed slots plan on the legislature.

By having Mr. Perez give the administration's blessing to the customary pro-slots arguments, Mr. O'Malley has signaled that slots will be part of his next budget package as he tries to close an estimated $1.5 billion revenue shortfall. The package is also likely to include higher taxes and cuts in state spending.

Given that Senate President Mike Miller is an enthusiastic slots advocate, and that some Republicans now talk about an "auction" to ensure that the state gets as much as it can from slots, prospects for a return of the one-armed bandits are excellent.

Although it cites some eight-year-old economic impact figures, as well as statistics on the acreage of Maryland horse farms, Mr. Perez's 19-page report skips past the question of why the state is obligated to bail out this particular fast-fading recreational industry.

The document's central assertion, backed by counting license plates in slots emporium parking lots, is that Maryland is losing about $150 million a year in tax revenue to West Virginia and Delaware . (The report says it's too early to reach long-term conclusions on the effect of the slots in Pennsylvania .)

Even if you grant that Mr. Perez is right, $150 million will hardly erase the revenue shortfall, even if the state could get back every penny from West Virginia and Delaware . And it never will, because those states will respond by expanding gambling, and will probably start putting up full-fledged casinos.

The report, as is common in such documents, also assumes that higher racetrack purses financed by slots revenue are equivalent to a revival of the racing industry. Actually, there's plenty of evidence that having slot machines nearby does nothing to boost dwindling attendance at the tracks.

The report doesn't grapple with the costs of regulation, additional policing, addiction counseling, diminished revenue for nearby businesses and all the other fallout of legalized gambling.

No doubt saying all this is unfair, for the objective here was not to do a comprehensive study but to signal where the O'Malley administration is going. That much has certainly been done. Those who, like us, don't think that more gambling is the high road to Maryland 's future will have their work cut out for them