10/31/2007

Another Look at Slots Versus Casino Gambling
Commentary by Tom Range, Sr.

Atlantic City Skyline

Among the often-repeated arguments against the legalization of slot machine gambling in Maryland is the claim that the location of a slot machine venue will "make it like another Atlantic City."  It is specious to draw a parallel between the legalization of slot machine gambling in a handful of areas in Maryland, as is proposed by the current plan before the state legislature, and the huge casino gambling operations in Atlantic City.

Atlantic City was designated as the only site in New Jersey to allow casino gambling, that is, not only slot machines but table "gaming" (the euphemism for gambling) offering poker, roulette and blackjack as well.  Table gaming is not envisioned in the legislation currently being considered in Maryland.  Even if there existed a parallel between the casinos of Atlantic City with their table games, and the slot machines that would be sited in a relatively few locations at horse racing tracks, the questions remains: would the fate of Atlantic City be all that detrimental to Maryland, and specifically Worcester County?

There now exist some 13 casinos in Atlantic City, having been opened from 1978 through 2003.  The issue of state-wide gambling first appeared on a ballot for New Jersey voters in 1974.  The initial referendum was defeated in 19 of the state's 21 counties with about 60 percent of votes cast against the proposal.  A revised referendum, limiting gambling exclusively to the city limits of Atlantic City, was placed on the ballot in 1976.  It was approved by a slim margin, 1.5 million votes in favor and 1.14 million opposed.  The city's first casino, Resorts International, opened on May 26, 1978.

The decline of Atlantic City as a resort destination for well-heeled travelers began in the 1960s when the vacationing public chose Miami, Havana and Bermuda rather than the Jersey Shore.  Las Vegas, Nevada had been transformed into the gambling capital of the country.  Atlantic City, while still attracting name performers to the stages of its hotels, had become a decaying shadow of its former self.  Its population, living literally within the shadow of the once elegant hotels, suffered poverty disproportionate to their numbers.  Decaying storefronts marred the appearance of city streets located only a few blocks away from the boardwalk. 

In contrast, in 2006 the casino industry in New Jersey employed over 47,000 local people, 73 percent in full-time positions.  Casinos purchased over $2 billion in goods and services from 2,400 New Jersey businesses.  Gross revenues in 2006, defined as the amount casinos win from their gambler/patrons after all payouts have been made, reached a total in excess of $5 billion. 

The state of New Jersey collects eight percent tax on casino gross revenues which is earmarked to fund programs that provide resources and services to disabled and senior citizens.  Each casino is also required to invest 1.25 percent of its gaming revenues into state sponsored projects designed to improve infrastructure, housing, economic, cultural and social development.  This program, the Casino Reinvestment Development Authority, has invested $12.1 billion in these projects through 2006.

Casino gambling in Atlantic City, while hardly the panacea that was originally envisioned, did revitalize the decaying Jersey Shore of the 1960s.  A major failure of the venture was the shortfall in hiring locals to work the casinos in positions other than housekeeping and maintenance.  The State Gaming Commission is strict in its supervision of who is hired to work the gaming tables.  Employees must be 21 years of age.  In addition to specific age requirements, job applicants are checked for evidence of criminal record.  Since the floor employees handle substantial amounts of cash, a criminal record may preclude an applicant from working the tables.  Drug users are advised to "think about pursuing a different line of work."

The installation of 9,500 slot machines at four Maryland venues is hardly duplicating casino gambling, with both slots and table gaming, as found in Atlantic City and the Native American reservation gambling operations like Foxwoods Resort and Casino in central Connecticut.  What the legislation under review will provide is the four locations related to horseracing be set aside for slot machines, similar to the operation in nearby Delaware. 

Whether, as is brought up as another danger, slot machine gambling will morph into the conversion of waterfront hotels into full fledged casinos ultimately depends upon the will of the people to be determined by the votes of their legislators or by themselves in a state-wide referendum.