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Board Approves Spending $32.7 Million On Slot Machines

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By BRIAN WITTE Associated Press Writer

ANNAPOLIS, Md. (AP) Maryland officials approved spending $32.7 million on Wednesday to buy or lease 750 slot machines for use at the Ocean Downs horse racing track near Ocean City.

The Board of Public Works voted 2-1 to approve the contract. Comptroller Peter Franchot voted against it, while Gov. Martin O'Malley and Treasurer Nancy Kopp supported it.

Franchot criticized the deal because only six of eight vendors met the 25 percent goal of minority business participation. He also opposed the idea of the state spending millions on slot machines that have yet to yield any revenue for the state.

"All over the state, even supporters of slots find it very difficult to understand the millions of dollars being paid out," Franchot said.

So far, the board has approved spending roughly $97 million to buy nearly 2,200 slot machines at two locations. The cost includes installation and maintenance.

Lawmakers decided the state should purchase the machines to ensure greater oversight when they approved the framework for the slot machine plan in a special session in 2007.

Ocean Downs is authorized to have 800 slot machines. Steven Martino, the director of the Maryland State Lottery Agency, said Ocean Downs wants to see what the market demand is before moving forward with the full 800 machines. Slot machines at the track are scheduled to be turned on in December.

In June, the board approved a $49 million contract to buy about 1,000 slot machines for a casino near Interstate 95 in Cecil County that's on track to become Maryland's first with an opening date in late September. Two weeks after the board voted to buy the first 1,000, the board approved buying another 438 slot machines for roughly $15.9 million at that location.

Slot machines are expected to generate hundreds of millions of dollars annually for the state when they are fully operational. A constitutional amendment approved by voters in 2008 authorizes Maryland to have up to 15,000 slot machines at five locations.

The other three potential sites for slot machines Anne Arundel County, Baltimore and at Rocky Gap State Park in western Maryland are in limbo. A proposal to build the state's largest casino with 4,750 machines near a shopping mall in Anne Arundel County is facing a referendum vote in November.

In other business, the board delayed action on two contracts adding up to $160 million over eight years for engineering consultant services on mass transit initiatives, including a proposed Red Line light rail in Baltimore and a Purple Line light rail in the Maryland suburbs of Washington.

Franchot pointed out that local jurisdictions statewide have seen huge reductions in highway user money to maintain roads.

"From the local perspective, they see potholes and us voting a lot of money for consultants," Franchot said.

Maryland Transportation Secretary Beverley Swaim-Staley, who noted that the most of the money involves federal funds, said she also has questions about the contracts, but she anticipates bringing them back to the board soon.

"We have to make sure that we follow both the federal procurement rules and the state procurement rules," she said.

(Copyright 2010 by The Associated Press. All Rights Reserved.)

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