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March 28, 2011

Senate lowers tax rate (again) for Rocky Gap

Maryland's Senate tonight gave the final nod to a bill that would drastically lower the tax rate for gaming revenue from a casino at Rocky Gap in Western Maryland in an attempt to gin up interest in the aging site.

The Senate plan would reduce the tax on gaming revenues to 50 percent, well below the 67 percent that the state takes (or will take) at the other four casinos in Maryland. The lower rate would be in effect for 10 years.

The plan also would ease the current ownership rules: A bidder for Rocky Gap would be allowed to own another casino in the state. And, a future owner would be allowed to place slot machines in the lodge, eliminating a current provision that they construct a separate casino.

"We want someone to buy the lodge which is costing us money," explained Sen. George Edwards, a Western Maryland Republican.

The state-funded Rocky Gap Lodge opened in 1998 and includes an 18-hole golf course and conference center. But the lakeside resort has been a drag on the state's finances.

The facility had an operating loss of $3.8 million in fiscal year 2010 and does not generate enough revenue to cover debt payments, according to an analysis by the department of legislative services. 

(Photo credit: Julie Bykowicz)

Last year, hoping to attract bidders, the General Assembly lowered the tax rate from 67 percent to 64.5 percent and permitted the owner of another casino to operate Rocky Gap. The effort failed.

Edwards, whose district included Rocky Gap, said there that prospective bidders have expressed interest in the site if the proposed legislative changes are made.

Rocky Gap is the only of the five voter-approved gaming locations not to attract a serious bidder. Casinos in Cecil County and the Eastern Shore are operating. A fourth casino at Arundel Mills is under construction. The fifth casino in Baltimore in the final stages of litigation, and the state is expected to request new proposals within weeks.
Posted by Annie Linskey at 8:07 PM | | Comments (2)
Categories: Slots
        

Comments

CLOSE IT! Sheesh, How long does Maryland let something continue to cost the taxpayer money before letting it die it's natural, free market, death?
According to the Horse racing industry....NEVER!

If this Rocky Gap Center is owned by the state, why doesn't the state do the operating of the casino and leave the private profiteers out of the game? That should have been the approach with the other proposed slots or casino facilities. It would save money by having all of the proceeds stay in state hands for use in legitimate state programs (primarily public school programs and not this other stuff that was attached to the slots amendment just to buy votes).

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About the bloggers
Annie Linskey covers state politics and government for The Baltimore Sun. Previously, as a City Hall reporter, she wrote about the corruption trial of Mayor Sheila Dixon and kept a close eye on city spending. Originally from Connecticut, Annie has also lived in Phnom Penh, Cambodia, where she reported on war crimes tribunals and landmines. She lives in Canton.

John Fritze has covered politics and government at the local, state and federal levels for more than a decade and is now The Baltimore Sun’s Washington correspondent. He previously wrote about Congress for USA TODAY, where he led coverage of the health care overhaul debate and the 2010 election. A native of Albany, N.Y., he currently lives in Montgomery County.

Julie Scharper covers City Hall and Baltimore politics. A native of Baltimore County, she graduated from The Johns Hopkins University in 2001 and spent two years teaching in Honduras before joining The Baltimore Sun. She has followed the Amish community of Nickel Mines, Pa., in the year after a schoolhouse massacre, reported on courts and crime in Anne Arundel County, and chronicled the unique personalities and places of Baltimore City and its surrounding counties.
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