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While state leaders tout the millions in new tax revenues that Maryland could reap from a sixth slots location, small businesses might be wondering where their share is of the slots taxes that the state already has collected.
The state’s slots law includes a 1.5 percent set-aside from total slots revenues for small and minority- and women-owned businesses. This fund stood at $2.92 million through June, according to the Video Lottery Facility Location Commission.
But not a penny has been disbursed.
Working out comprehensive procedures for managing and distributing the money has caused delays, said Karen Glen Hood, spokeswoman for the Maryland Department of Economic and Business Development.
Although the state originally tasked the Board of Public Works with overseeing the fund, the three-member board tapped Hood’s agency near the end of 2010 for its experience with handling this type of funds. Hood compared the fund with the state’s revolving loan funds. The board still would control most of the management, but her agency would help with operations, Hood said.
But first, the board and DBED must answer questions about how the fund would operate, she said.
For example, the money is supposed to go to small businesses in the communities where the slots parlors are located. But the board lacked guidelines on how to define these local communities, and whether the fund manager had to be from the community.
Further complicating the matter was that until last month, only two of the intended five slots locations were open, which threw off anticipated numbers and methods, Hood said.
“There were a lot of questions to be answered,” she said.
So far, Hood said, her agency has drafted a memorandum of understanding with the board and hopes to have a finalized agreement soon.
The money should start flowing this year, she said.
“I understand people think we’ve been dragging our feet on this. It’s just been complicated and things the legislation was predicated on haven’t come to fruition,” Hood said.