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December 9, 2008 11:48 am

News Brief: How Slots Affect College Funding

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Facing possible state budget cuts as the economy worsens and the state deficit deepens, the slots referendum that passed by a wide margin last month may assist in funding the College’s capital projects.

Though the College receives a block grant of approximately $17 million a year, Governor Martin O’Malley has already trimmed the state budget $1.5 billion since taking office in 2007. As state revenue projections fall and a likely $1.3 billion deficit in fiscal 2010 is expected, Governor O’Malley is considering drastic measures such as a state employee furlough. Professor of Economics Asif Dowla has noted, “I think legislators in a dire situation can always renege on their commitments to give us money.”

The state will issue five licenses for no more than 15,000 total slot machines, to be used in Baltimore City and four counties: Anne Arundel, Cecil, Worcester and Allegany. Slots are projected to raise about $600 million of state revenue and is slated for education.

While slots revenue will not assist in the College’s operating budget that has been increasing due to high energy and food costs, the funding will help capital projects. Upcoming projects include renovating Anne Arundel Hall, the Maryland Heritage Center, an amphitheater, a music performance center to take the pressure off of Montgomery Hall and eventually renovating Calvert Hall. “The reality is the government wants to help build up the facilities needs, which is sometimes challenging. We dedicate a lot more of our effort working on facilities in the last decade than perhaps other Maryland schools,” explained Tom Botzman, Vice President for Business and Finance.

Slots revenue will not be realized for a few years as the bidding process takes place and slots are installed in the venues selected. Opponents, such as Comptroller Peter Franchot, argue that slots are not a solution to budget challenges. They see the social ills of potentially increased crime and addiction as additional costs that taxpayers will have to pay now that Question 2 has passed. “I suspect for many residents there are already close to places to play slots so some of those costs we already have. There are people that will feed almost any habit and gambling is one of those habits,” said Botzman.

Lieutenant Governor Anthony Brown echoed a similar sentiment as Botzman during his visit to the College on Nov. 24. “Maryland residents already have access to slots in Delaware, Pennsylvania, West Virginia and New York. Now we are bringing that lost revenue back to Maryland.”

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