rguing that the machines are similar to slots and should have been confiscated years ago, Peter Franchot, the leader of the opposition to the slots referendum, made comments in advance of a Senate committee hearing tomorrow on a bill that would prohibit bar owners and others from keeping the machines.
"The gambling industry is making a killing on these operations," Franchot said, standing in front of a Baltimore County tavern that has licenses for three of the video machines. "The time has come to put an end to it."
A 2006 report by the Abell Foundation estimated that nearly 3,500 machines are operating in Baltimore City and Baltimore County, bringing in between us$ 91 million and us$ 182 million a year in gross revenue. The report suggests operators are underreporting revenues to reduce their tax burden. The proposed ban is expected to face opposition from owners and operators of the machines and some nonprofit organizations that depend on revenues they generate.
Bruce Bereano, a lobbyist for Frank Moran & Sons, a Baltimore County company that manufactures electronic bingo machines - which the legislation also would ban - said that state officials have not proposed a way to replace the revenue that would be lost for programs if the ban is approved. "If you do away with all of this local activity, who is going to provide the money for the ... causes that are funded?" Bereano said. "No one’s proposing any replacement for it financially."
The machines, which are licensed by local governments, are often labeled as "for amusement only," but opponents argue that payouts are made under the table. In some counties, electronic bingo machines - which can be virtually identical to slot machines - are allowed to pay out legally. The issue is separate from the debate over legalizing slot machines, which will culminate in a referendum this November.
Franchot’s news conference was held outside the Olde Philadelphia Inn on Philadelphia Road. "This cash-only business with its lax oversight makes it ripe for corruption and tax evasion," Franchot said. "The ultimate solution to this problem requires an outright and explicit ban on these machines."