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Maryland voters on Tuesday approved a constitutional amendment that legalizes slot machine gambling in the Free State with the aim of adding millions to state coffers for schools.

The referendum offered "the most taxpayer friendly" plan for Maryland's budget, said Frederick W. Puddester, chairman of the pro-slots coalition For Maryland For Our Future.

"This thing was successful in every part of the state," he said.

Bringing slot machines to Maryland will "fund our increase in education and bring back money that's going to West Virginia and going to Delaware," he said.

The General Assembly will continue to have to deal with a floundering national economy that is hurting state revenue and that led to nearly $350 million in budget cuts last month, said Puddester, who was state budget secretary under Gov. Parris N. Glendening (D).

But the state can address a long-term a structural deficit created by a 1997 income tax cut and a $1.3 billion increase in spending on K-12 education.

"That has finally been resolved," Puddester said.

Comptroller Peter V.R. Franchot (D), who had been the most outspoken public official to oppose the referendum, said slots opponents "fought a good fight."

"We are proud of the thousands of people who worked with us and who voted against slots with us," he said. "We have nothing to be ashamed of. We were outspent by the gambling companies. But one thing this does is prove to the gambling industry that the people of Maryland will fight before they let gambling invade their state."

The state's poor fiscal outlook played a part in the vote, Montgomery County Councilman George L. Leventhal said.

"It's a sign of the reaction to desperate and hard times in the state," said Leventhal (D-At large) of Takoma Park. "In the long run I think Maryland will regret the decision."

The ballot question asked voters whether to approve a constitutional amendment to bring 15,000 slot machines to five locations in Allegany, Anne Arundel, Cecil and Worcester counties and Baltimore city. Legislative analysts project the machines could generate $1.36 billion by fiscal 2013. Of that, a projected $660.4 million would go toward schools.

High-profile state officials have taken up either side of the debate, with Franchot the most visible member of the anti-slots coalition that includes some clergy members, local chambers of commerce and the National Association for the Advancement of Colored People.

Gov. Martin O'Malley (D) advocated for the referendum, which garnered support from the state teachers union, AFL-CIO and the American Federation of State, County and Municipal Employees, the Maryland Chamber of Commerce and horse racing interests.

O'Malley shepherded legislation putting the referendum on the ballot through a special session of the General Assembly last fall. It was packaged with a series of budget cuts and new taxes designed to close a $1.5 billion budget gap.

Supporters of the referendum argued that legalizing slots will bring much needed revenue to the state's budget by stemming the flow of an estimated $400 million now flowing across borders to slots parlors in Delaware and West Virginia. Even more Maryland dollars are flowing out-of-state to recently legalized gambling parlors in Pennsylvania, though that amount has not yet been calculated.

Opponents argued that the machines will not capture as much as proponents estimate, will harm the poor and will inject gambling interests into state politics while bringing social ills such as gambling addiction.

Wide disparities in fundraising determined how the two sides waged the debate. Anti-slots advertisements began appearing on television just last week. Meanwhile, ads by the pro-slots For Maryland, For Our Future, bankrolled by an infusion of cash from gambling interests, began appearing on TV a month before Election Day.

Gambling advocates raised almost $3.8 million through Oct. 5, according to campaign finance reports, compared with just $411,000 for the chief anti-slots group.

The push for slots was buoyed by a $2 million bridge loan from the parent company of Magna Entertainment Corp., which operates Pimlico Race Course in Baltimore and Laurel Park.

Anti-slots group Marylanders United to Stop Slots acknowledged early on that they would be outspent by the pro-slots group and opted to make their case with news conferences and rallies that numbered several each week over the past month.

On Tuesday, slots proponents distributed handbills at polling places that read "No New Taxes. Stronger Maryland Schools. Vote for Question 2".

The emphasis on school funding was the subject of a lawsuit over the ballot question's wording that was ultimately decided by the state's highest court.

On Sept. 15, the Court of Appeals ordered that the word "primary" be inserted in the question to reflect that education would be the main recipient of the slots revenue.

The referendum created strange alliances. County teachers unions and chambers of commerce broke with the state teachers union and state chamber, each which supported slots. Republicans in the House of Delegates found themselves united with the Montgomery County Democratic Central Committee in opposing the measure.

The debate also provided a stage for political theater as Franchot and O'Malley took shots at each other at Board of Public Works meetings and at appearances around the state, raising Franchot's profile and speculation that he could oppose the first-term governor in 2010.

On Tuesday night, Franchot said that the people of Maryland should know that it was O'Malley and Senate President Thomas V. Mike Miller Jr. (D-Dist. 27) of Chesapeake Beach who presented and supported the slots amendment.

Staff Writer Janel Davis contributed to this report.