From somdnews.com
Middleton’s bill would halt video gambling
ANNAPOLIS — Top Democrats are getting behind a measure to outlaw video gaming terminals in St. Mary’s County the use of which by area businesses could violate state law and dodge tax reporting requirements.
Senate President Thomas V. Mike Miller Jr., Senate Finance Chairman Thomas ‘‘Mac” Middleton and others will introduce legislation today to phase out the machines that have popped up throughout St. Mary’s in recent months.
‘‘We’re right back to where we were in the 1960s where we have slots at every bar and every corner,” said Middleton (D-Charles), a longtime slots foe who is the Senate’s lead sponsor.
Miller ardently supports slots, but is sponsoring the bill to ensure the state receives gambling proceeds.
The machines ‘‘cannibalize our state lotteries,” he said. ‘‘These machines have sprung up almost like a disease. The state needs to be in control of its revenues.”
The bill’s supporters — Del. Frank S. Turner (D-Howard) is the lead sponsor in the House —scheduled a news conference for today, Feb. 27, to further detail their proposal.
Miller (D-Calvert, Prince George’s) said the measure would also phase out the pull-tab machines at establishments like the Rod ‘N’ Reel in Chesapeake Beach, which legally operate the terminals.
The unauthorized machines have sprouted up statewide, but the main concentration is in St. Mary’s. Their presence undercuts the effort to legalize slots in Maryland, which is projected to generate millions of dollars of revenue for the state, Middleton said.
‘‘To see that whole effort now being undermined with this cancerous proliferation of video machines ... that money is not going into the coffers to address the outstanding needs we have,” he said. ‘‘They’re going into the hands of a few individuals.”
Businesses lease space to vendors of the gaming machines, which resemble video slot machines but, instead of coins, dispense paper slips stating the money that a player wins. Revenues are supposed to only go toward charitable organizations, but Miller accused private owners of pocketing some of the proceeds.
‘‘These are counterfeit slot machines, but the money goes to private entrepreneurs. ... The state doesn’t benefit at all and as a consequence our lottery revenues are down,” he said. ‘‘We need to eliminate these machines; we need to take the money out of these private entrepreneurs who are operating illegally in the state and what we need to do is get a handle on this so the state can once again get control of the lottery revenues.”
The bill will be filed as emergency legislation, meaning Gov. Martin O’Malley (D) can sign it as soon as it passes. Businesses found to be using the machines would have to cease operations immediately, but establishments like Rod ‘N’ Reel will have more time to phase them out.
‘‘The ones that have played by the rules get a longer time to adapt because they made a significant investment, but eventually all will be terminated,” Miller said.
Meanwhile, auditors for Comptroller Peter V.R. Franchot (D) went to St. Mary’s this week to investigate whether the video gaming machines are properly licensed and are paying Maryland taxes.
‘‘I believe that these machines need to be clearly defined in statute for what they are: slot machines that are operating in violation of the spirit of Maryland’s law banning them,” Franchot wrote in a letter sent Monday to Miller and House Speaker Michael E. Busch (D-Anne Arundel).
St. Mary’s County State’s Attorney Richard D. Fritz and Sheriff Timothy K. Cameron, both Republicans, have said the machines are legal, but voiced concern that there is no apparatus to track the proceeds.
‘‘This is a cash only business which makes it not only ripe for corruption, but for tax evasion as well,” Franchot wrote.
In one of his first acts as comptroller last year, Franchot launched a crackdown on gaming machines in Baltimore city, sending field agents into businesses to track proceeds and tax account numbers.
Sen. Roy P. Dyson (D-St. Mary’s, Calvert, Charles) has sponsored legislation requiring the Maryland attorney general’s office to decide on the legality of the machines. It will be heard in the Senate Judicial Proceedings Committee on Thursday.
nice to know a few doz machines can have such an effect on the state wide lottery 
