Baldacci faults proposed amendment to emergency racino bill

BANGOR – A proposal crafted by the various factions of Maine’s harness racing industry to amend the governor’s emergency racino bill has received less than rave reviews from the Baldacci administration.

The industry consensus amendment, as its proponents call it, also appears to have played poorly in Bangor, poised to become the host community for the state’s first racetrack casino.

An initial review of the amendment’s provisions suggests that the industry representatives involved in negotiating it attempted to tread the middle ground between the original racino legislation adopted by Mainers last Election Day, which some say is too lenient, and the governor’s emergency legislation, which some consider too restrictive.

The proposal was unveiled to Bangor officials during a workshop Monday night. Penn National’s attorney, Christopher Howard of the Portland law firm Pierce Atwood, presented the proposal to the governor’s chief counsel, Kurt Adams, on Tuesday, according to Lee Umphrey, the governor’s spokesman.

“The governor does not support this amendment, which appears to be designed solely to undermine the state’s regulatory authority,” Umphrey said.

“The governor wants to honor the will of the people and have a voter-approved racino that operates in the best interest of the city of Bangor and state of Maine,” he said. “While the governor’s bill creates necessary strict regulation without expansion, this amendment raises several questions because it significantly weakens license criteria and the regulation of slot machine operations.”

“Overall the amendments would produce a regulatory climate with even less oversight and regulatory control than the citizens’ initiated bill,” Umphrey said. “For instance, [it] would eliminate the checks on corruption that were in the initiated bill. In addition, the amendment provides for ‘provisional’ slot machine licenses.

“The provisional license would allow Penn National to get licensed without going through any licensing at all,” he said. “The licensing would all take place later, long after slots are in operation.”

Umphrey also said changes the industry wants to make to the regulatory framework proposed by the governor would “place Penn National in complete control of the machines. The state would not be able to disable machines that had been tampered with. The state could not suspend a license unless it had a long hearing – so violations of the law or rules could continue while the operator’s lawyers delayed the administrative process.”

What the administration found “most surprising” about the industry plan was that “Bangor would be precluded from ever operating the slot machines on its own – they would always have to have an operator,” Umphrey said.

The outside legal counsel the city hired to protect its racino interests is still reviewing the amendment to see what impact, if any, it would have on the city, Bangor City Council Chairman Dan Tremble said Wednesday.

“At first blush, it looks like it provides additional benefits to the harness racing industry and the OTBs and other people in the industry,” Tremble said. “But as a city, we need to do what’s best for us. We’re still looking at it.”

“I don’t see any benefit to taking a position on it,” he added. “It provides no additional revenues [for the city] and it looks like it even may hurt us.”

Among other things, the amendment at issue would reduce the earning potential for Penn National Gaming, the Bangor racino’s anticipated operator.

At the same time, it would increase financial support for such harness racing stakeholders as horsemen, breeders and owners, agricultural fairs, track operators, off-track betting facilities and the state’s two commercial harness racing tracks – Bangor Raceway and Scarborough Downs.

Both tracks are working with the Pennsylvania firm Penn National Gaming to develop racinos, though Scarborough’s odds of succeeding are less certain because it failed to receive local approval in Scarborough, Saco and Westbrook before the deadline last Dec. 31.

Howard said this week that the amendment was the product of a compromise among the various stakeholders. It aims to keep the racino concept in Maine viable, both politically and financially.

The industry offering retains many of the key provisions contained in the governor’s bill, including a proposed five-member gambling control board that would be housed within the Department of Public Safety. The referendum law gave the Maine Harness Racing Commission the job of regulating slots.

Howard said that the amendment addressed concerns raised by Baldacci and state lawmakers and it helped keep various sectors of that community financially viable, especially as Maine’s fledgling racino initiative gets off the ground.

Interestingly, the industry’s version is the first to propose steps to strengthen Maine’s ailing harness racing industry.

For instance, the industry amendment would require the Maine Harness Racing Commission to establish a minimum number of races for each race day of each year for Maine-owned or Maine-sired horses, based on the industry’s ability to provide qualified horses.

It also would tie the ability to operate slot machines to a minimum number of race dates. As things stand, Bangor Raceway offers fewer than 30 race days, while Scarborough Downs conducts more than 100.

The industry proposes that beginning in 2006, commercial tracks not be allowed to operate slots unless they applied for and conducted at least 150 days of live racing the previous year. An exception would be made if the harness racing commission granted fewer days than the 150-day minimum.

The governor’s emergency bill, LD 1820, could replace part or all of the original slots law approved by Maine voters in November that allowed slot machines at the state’s two commercial harness racing tracks in Bangor and Scarborough.

The governor’s bill is still under review by the Legislature’s Legal and Veteran Affairs Committee.

The committee is scheduled to continue that work at 1 p.m. today.