Lack of interested racino parties disappoints state budget panel

AUGUSTA – Members of the budget-writing Appropriations Committee were expecting ideas Tuesday from both Hollywood Slots at Bangor and the harness racing industry in response to proposals before the panel to take more of the revenue from slot machines to help balance the state budget. No one showed up.

“They should have,” said Sen. Karl Turner, R-Cumberland, a Republican lead on the committee. “We are looking for their ideas, their comments on what is before us. If I were in the racino business here, I would be trying to think of a viable alternative proposition that would minimize the negative impact on me.”

Turner and Rep. Jeremy Fischer, D-Presque Isle, the House chairman of the committee, said the threats to halt construction of the new facility in Bangor made by Penn National executives in Tuesday’s Bangor Daily News are counterproductive.

Fischer called the threats “silly” and said Penn National is not the only possible operator of slots in Maine.

“To come out throwing bombs and threatening the state of Maine just is not responsible,” Fischer said. “The Penobscots just passed a bill [through committee] to get slots. I am sure they would have great interest if Hollywood Slots picked up and left with taking over some or all of that business.”

The committee is considering several proposals to take more of the revenue being generated at Hollywood Slots. The Democrats on the panel suggested increasing the state share of the gross slot machine income from 1 percent to 2 percent and reducing the amount of money from bets that gets paid back in winnings from 93 percent to 92 percent. Those two changes were designed to generate $5.4 million in the first year of the biennial budget and $8.4 million in the second year to help balance the state budget.

Jon Johnson, the Hollywood Slots general manager, told the panel last Friday that under that plan it would take the company 182 years to recover the investment in the Bangor facility.

“We were listening,” Fischer said. “What we were saying, both Republicans and Democrats, is that we think there is some additional revenue to be had for the state from the racino. We made one proposal, the Republicans went a different way, but both are saying we think there is some money there to help balance the budget.”

Turner said he is not familiar enough with the gambling industry to know what the best approach to raising additional revenue is, but he agreed with Fischer that all proposals have to be considered.

“We are looking for ideas,” he said. “We are open to ideas.”

Both committee members expressed disappointment that no one from the harness racing industry was present at the committee work session to discuss the GOP proposal, which seeks to limit the increase in the amount of money distributed from slot revenues to 5 percent. With the planned expansion of Hollywood Slots in Bangor, revenue to the various recipients is projected to grow by about 50 percent.

Part of the revenue goes to racing purse supplements, subsidies to the commercial harness racing tracks, and support for the state’s agricultural fairs. Turner said with other programs in state government being flat-funded or given only slight increases, it is hard to overlook the huge growth those programs would get under the current law.

“We are not cutting anybody,” he said. “This is to limit the growth of programs.”

Turner said today’s planned rally and protest by several groups with a stake in the current revenue-sharing arrangement may affect a few votes, but that the industry should work with the committee. He said programs such as school funding and Medicaid also have support among lawmakers.

“I think disappointment is the word I would use,” Fischer said of the failure of the interested parties to attend Tuesday’s meeting. “People in the industry couldn’t show up here, but they are planning a protest. I think their time would be more productive working with us to come up with a solution.”

He said protests are part of the political process but don’t solve the budget problem. He said the committee is determined to develop a budget fair to all Mainers.