This story was clarified on July 30. An explanation follows the story.
Maryland isn’t the only state that has been grappling with the issue of expanded gambling lately, and it’s not the first to see plans for a major facility stall in the legislature.
This year, states including Illinois, Michigan, Rhode Island and New York considered some form a gambling expansion, and protracted debates and false starts are common, experts say. Florida, in particular, has been locked in a fierce battle in regard to the issue.
Debate on whether Maryland should add a sixth casino in Prince George’s County, as well as table games, has dragged past the regular session and into the summer. Owners of the state’s largest casino support adding table games but want to make sure the five initial locations are open and thriving before another is added, and House of Delegate members have balked at proposals to lower the 67 percent tax on slots revenue.
“Maryland is very typical,” said Mark Nichols, professor of economics at the University of Nevada, Reno. “Gambling expansion is always controversial and frequently moves slowly.”
States that find themselves surrounded by other gaming states often face increased pressure to cash in on the market, and Maryland is no exception, Nichols added.
As the discussion about billion-dollar, destination resorts in Maryland was beginning early this year, lawmakers, casino operators and gambling opponents in Florida found themselves embroiled in a similar debate in regard to a proposed multibillion-dollar resort casino in the Miami area.
Legislation that would have paved the way for the facility died in a House business subcommittee in February, but not before drawing fire from business leaders and operators of the state’s existing casinos who wanted to protect their investment.
It would have “cannibalized” existing businesses, said Edie Ousley, vice president of public affairs for the Florida Chamber of Commerce, which was part of a coalition that opposed the plan.
Gambling itself is hardly new to Florida, which already has eight Indian casinos, racetracks with slot machines and hundreds of unregulated Internet gambling cafes.
But legislation introduced this year tried to simultaneously shrink gambling in the state and pave the way for high-end, destination resort casinos in south Florida.
State Rep. Erik Fresen (R) proposed elevating the caliber of gambling in the state by allowing three $2 billion casino resorts that would draw visitors from around the world.
The plan was a way to contract gambling in the state by raising the quality of casinos, and forcing smaller, unregulated operations, such as the Internet cafes, out of business, according to Fresen.
The Malaysia-based Genting Group planned to invest $3.8 billion in a 30-acre project in Miami that would have included the largest casino in the nation.
Prince George’s County Executive Rushern L. Baker III (D) and the developers of National Harbor in Oxon Hill are pushing to bring a similar, if smaller, destination facility to the banks of the Potomac River that would draw visitors from Washington, D.C., and Virginia. MGM Resorts International plans to build an $800 million facility at the waterfront development, which it estimates would create as many as 4,000 permanent jobs.
But the odds of success for such “destination” casinos, which aim to minimize the amount of money spent by local customers, are dubious, Nichols said.
“That, of course, is what made Las Vegas and Nevada in general a very successful model,” Nichols said, adding Atlantic City also had a similar cache until it began losing gaming revenue to Pennsylvania.
“I really question why someone would want to go to a Miami destination resort rather than Las Vegas,” Nichols said, adding the same principle held true for Maryland. “There can only be so many destination resorts.”
State officials were fooling themselves if they thought that casino revenue wouldn’t come largely from local residents, Nichols said.
Fresen’s plan for Florida drew fire not only from the state’s Chamber of Commerce but from the Seminole Indian tribe. The tribe operates seven gaming facilities in the state, including two Hard Rock Hotel & Casino sites, and wanted to protect its share of the market.
David Cordish, owner the recently-opened Maryland Live! Casino in Hanover, has made a similar case, arguing additional casinos should not be allowed until the state’s initial five locations are up and running.
The Miami-area proposal also was criticized by the Walt Disney Co.
“It is inconsistent with Florida’s brand as a family-friendly destination and with efforts to diversify Florida's economy,” said Brian Malenius, Disney spokesman.
Florida House Speaker Dean Cannon (R) has been skeptical of expanding gambling.
This week, Genting representatives told The Miami Herald the company was scaling back its local resort proposal. The company now is planning a hotel with fewer than 500 rooms, about one-tenth its original resort proposal, but is studying whether there should be a voter referendum on expanding gambling.
Similarly, if legislation emerges from a special session, Maryland voters will end up voting on expanded gambling in November.
With large amounts of money at stake, gambling will always be a politically charged issue, said Holly Wetzel, spokeswoman for the American Gaming Association.
“I don’t think the discussion is over in Florida,” she said.
The story clarified the position of the Florida Chamber of Commerce on casino expansion. The organization is concerned that Florida businesses would be hurt by a multibillion-dollar casino resort.