State approves $33M more for slots 

Posted: 8:21 pm Wed, August 11, 2010
By Nicholas Sohr
Daily Record Business Writer

ANNAPOLIS — The state committed $33 million on Wednesday to outfit what is expected to be the second operating casino in Maryland, despite continued criticism of slot machine manufacturers for not meeting minority business participation goals.

The Board of Public Works also put off a vote on $160 million for transportation consultants to work on light rail projects in Baltimore and the Washington suburbs at the request of Transportation Secretary Beverley K. Swaim-Staley. She said the contracts, which would be split between two groups of Baltimore-based consultants, would be part of the next phase in the Red Line and Purple Line projects, which are awaiting federal approval to move forward.

“The next phase would be design and engineering,” Swaim-Staley said. “We do expect to move into the next phase with the goal that these projects would be able to compete for construction money, when construction money comes available as part of a new federal transportation authorization.”

Comptroller Peter Franchot, one of three board members, questioned the plan to spend such a large sum on consultants when the state is experiencing high-profile problems with its public transportation network, like MARC, and local governments’ share of state road maintenance funds have been cut.

“From the local perspective, they see potholes and we’re voting for consultants,” Franchot said. “Right now they can’t even fill a little pothole, much less a big one.”

Swaim-Staley said the consultant contracts are necessary to keep the Red and Purple lines moving forward.

“We continue to make bridges our top priority, as we always have. We are continuing to fund two transit systems and to push forward to meet the needs of future economic growth, which can only be met in urban areas by expansions like the Purple Line and the Red Line,” she said. “We’re balancing all the issues.”

Swaim-Staley declined to estimate when the state would win a federal OK to move ahead with the projects. The Maryland Transit Administration, which is overseeing the projects, has predicted its federal counterpart will allow the rail lines to enter preliminary engineering this year, with construction starting in 2013 or 2014, if money is available.

Plans call for the Red Line to run from Woodlawn to the Johns Hopkins Bayview Medical Center in East Baltimore. Most of the 14.5-mile route would be above ground. The 16-mile Purple Line would extend from Bethesda to New Carrollton, and link to Metro’s Red, Green and Orange lines. The projects carry a combined price tag of about $2.5 billion.

Swaim-Staley said her staff needs more time to get answers to “basic questions” about the scope of the consulting contracts. The two consulting teams would have a combined 39 subconsultants working with them over the eight-year term of the contract. The consultants’ duties would include community relations, environmental permitting, project planning, obtaining property along the proposed routes and a host of engineering tasks.

Swaim-Staley said she expects between 50 percent and 80 percent of the $160 million to be covered by federal funds.

The state’s ramp-up of its gaming presence faced more criticism from Franchot on Wednesday. The top tax collector questioned efforts by two slot machine manufactures to include minority-owned business, or MBEs, as subcontractors.

Of the eight manufacturers sending machines to Ocean Downs, the harness racing track near Ocean City, two missed the 25 percent goal set for minority participation. International Game Technology and Shuffle Master also fell short of the MBE goal when the state bought and leased slots for Hollywood Perryville Casino in Cecil County.

“What kind of message are we sending to the six that achieved the goal if we’re giving the other two a waiver?” Franchot asked Stephen Martino, director of the Maryland Lottery Agency.

Martino said all of IGT’s in-state spending will go to minority subcontractors, and that he met with company officials Tuesday afternoon and discussed the MBE goals.

“We continue to urge IGT in particular to increase that [participation], and we’re working with them to that,” he said.

Ocean Downs is expected to open in late December with 750 slot machines, and eventually expand to 800.