Referendum 2 – Video Lottery Terminals (Slot Machines)

Maryland General Election

November 4, 2008

Dear Friend:

This November’s election will provide Maryland citizens an opportunity to decide whether to have video lottery terminals – generally called slot machines – by voting on Referendum Question #2.

Because this is such an important decision that we must make, please take a moment to read the following questions and answers so that you may be better informed. Your vote will help determine the direction gaming takes in our State.

How will the question appear on the ballot?

Authorizing video lottery terminals (slot machines) to primarily fund education

Authorizes the state to issue up to five video lottery licenses for the purpose of raising revenue for education of children in public schools, pre-kindergarten through grade 12, public school construction and improvements, and construction of capital projects at community colleges and higher education institutions. No more than a total number of 15,000 video lottery terminals may be authorized in the State, and only one license may be issued for each specified location in Anne Arundel, Cecil, Worcester, and Allegany Counties and Baltimore City. Any additional forms or expansion of commercial gaming in Maryland is prohibited, unless approved by a voter referendum.

Is it true that this question, if approved, will amend the Maryland State Constitution?

Yes. This is a constitutional amendment that specifically authorizes video lottery terminals (slot machines) in Maryland.

If this amendment is approved, where will the slot machines go and how many in each location?

  • Anne Arundel County, within 2 miles of MD Rte 295 – 4,750 Terminals

  • Cecil County, within 2 miles of Interstate 95 – 2,500 Terminals

  • Worcester County, within 1 mile of intersection of Rte 50 and Rte

  1. - 2,500 Terminals

  • Alleghany County, within Rocky Gap State Park – 1,500 Terminals

  • Baltimore City, in a non-residential area, within a half mile of both Route 295 and Interstate 95 on property owned by Baltimore City – 3,750 Terminals

Does this amendment, if approved, allow for the expansion of gaming in other jurisdictions of Maryland?

Yes. In the future, another referendum can be placed on the State wide ballot to expand gaming in Maryland.

The amendment states that the income from slot machines will go primarily to fund education. Where will the rest of the money go?

The amendment is the first of a two step process. The second step is Senate Bill 3–Maryland Educational Trust Fund – Video Lottery Terminals which implements this form of gambling. Since the first step is a constitutional amendment, it is not subject to change by the General Assembly. The second step is legislation that implements the amendment. It is subject to alteration by a simple majority vote in the General Assembly before being placed on a State wide referendum.

Under the currently approved legislation, proceeds will be distributed as follows:

  • 2% – Video Lottery Commission Administration Costs

  • 2.5% – Racetrack Facility Renewal Fund – (Up to $40 million per year for 8 years,

Divided 80% to Pimlico, Laurel, Timonium and 20% to Rosecroft and

Ocean Downs; then the 2.5% goes to the Education Trust Fund)

  • 5.5% – Local Jurisdiction Impact Grants (82% of funds raised go to the four local

Jurisdictions based on revenue raised; the remaining 18% goes to Baltimore City)

  • 7% – Racing Purse Dedication Account (Up to $100 million per year)

  • 1.5% – Small, Minority & Women-owned Business Investment Fund

  • 33% – Video Lottery Operation Licensees

  • 48.5% – Education Trust Fund *

*Education Trust Fund resources are used to raise revenue to fund construction and capital improvement projects and to provide operating support for public education, from pre-kindergarten through college/university. As a general rule, funding in the various state trust funds is used only for the purpose stated. On occasion, the funds have been used to eliminate budget shortfalls in the General Fund.

These are just some of the questions I have been asked as I speak to many Charles County citizens. As always, if you have additional questions on the referendum, please don’t hesitate to contact my office or try to attend one of my upcoming meetings. I welcome your comments and views on such an important matter.

In the meantime, please be sure to vote on November 4th – because your vote – your voice – matters.

With best regards,

Sincerely,

Peter F. Murphy

Charles County, District 28