Casino changes upset minority groups

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A collection of minority groups is protesting changes the state made to requirements for casino developers eyeing the gaming license up for grabs in Baltimore.

Last month, the Video Lottery Facility Location Commission stripped explicit minority business enterprise benchmarks from the request for casino proposals. Instead, the state will work with developers to set goals on a project-by-project basis.

Arnold Jolivet, managing director of the Maryland Minority Contractors Association, said that decision was just the latest in the commission’s “lackadaisical” approach to the state’s MBE goals.

“For them to relax the minority and women business utilization for the Baltimore licensee, that was unfair to the minority business community,” Jolivet said.

His group has teamed with several others, including the local chapters of the Urban League, National Action Network and NAACP. Together, they go by the Maryland Collaboration of Community and Minority Business Organizations.

The coalition wants the commission to reverse its decision on the MBE benchmarks, Jolivet said. It had planned a pair of informational pickets Friday — outside City Hall and the downtown office of commission Chairman Donald C. Fry — but canceled them because of the rain.

The state’s slots program has stumbled over the MBE issue since before the first casinos were up and running. And the issue arose again in July when Baltimore City Entertainment Group filed a federal reverse-discrimination suit against Fry’s commission.

BCEG, the first bidder for the Baltimore license, alleged the original MBE goals — 37 percent for the city and 35 percent for the state — unfairly discriminated against white men in favor of women and minorities.

Fry said Friday the changes the commission made will give the state more solid footing in defending against the would-be developer’s suit. The state filed a motion to dismiss the BCEG suit Sept. 6.

“We’re trying to preserve the MBE program constitutionally,” Fry said. “The purpose of the amendments that were adopted by the commission were to follow the recommendations of the attorney general that will protect and preserve the MBE program.”

In its suit filed July 5, BCEG cited a letter from Attorney General Douglas F. Gansler urging Gov. Martin O’Malley in May not to sign the bill that imposed the minority business requirements on casino developers because there was not sufficient evidence showing the need for the carve-out.

“If you choose to sign this bill, it should not be implemented unless and until a study validates the need for such a remedy and a program narrowly tailored to reflect the results of that study is enacted,” Gansler wrote.

A study conducted later for the state by Nera Economic Consulting of Austin, Texas, showed that more than 99 percent of construction spending on the state’s first two casinos fell into categories in which Nera found evidence of discrimination. In an Aug. 11 letter to Senate President Thomas V. Mike Miller Jr. and House Speaker Michael E. Busch, Gansler wrote the Nera findings provided sufficient justification to implement the law O’Malley signed in May.

Jolivet said it is too soon to react to a lawsuit that has yet to be litigated, and the commission was more likely trying to make the Baltimore slots license more attractive to developers when it loosened the MBE requirements.

But, not all minority contracting groups are on board with Jolivet’s group.

Wayne Frazier, president of the Maryland Washington Minority Contractors’ Association, said the state had to make the changes to protect the program from the BCEG lawsuit. But, he added the amended MBE requirements would make things harder for minority contractors.

The issue has also taken hold in the Baltimore mayor’s race. Challenger Otis Rolley has repeatedly called on Mayor Stephanie Rawlings-Blake to explain “the elimination” of the MBE requirements.

Fry, however, said the MBE change was made at the state level and that “the mayor’s office and her representatives at City Hall were not involved in this decision.”

Jolivet denied the race and Primary Election on Tuesday factored into his coalition’s plans.

“None at all,” he said. “Politics had nothing to do with it.”

Proposals for the Baltimore casino project are due Sept. 23.