By Aaron C. Davis and John Wagner
Maryland voters legalized full-fledged casino gambling Tuesday, embracing a plan to bring a slice of Las Vegas to the doorstep of the nation’s capital, as well as transforming Maryland into one of the most concentrated casino markets nationwide.
With more than 98 percent of precincts reporting, the measure held a sizable advantage.
Voters’ approval of Question 7 greatly expands the state’s fledgling, slots-only casino industry, allowing Maryland Live! and two other sites to stay open 24 hours a day and by early next year to offer dice and card games such as craps, black jack and roulette.
But the full magnitude of the measure will be felt in coming years, when in 2016, a towering casino could rise from National Harbor over the District skyline and motorists traveling a 44-mile stretch between Baltimore and Washington would encounter three casinos, each with an array of table games and more slot machines than any single casino on the Vegas Strip.
In plodding toward a decision, Maryland voters weathered an unprecedented blizzard of political ads. In three short months since state lawmakers sent the issue to the ballot, campaigns funded largely by out-of-state gaming interests shattered every record for spending on a Maryland election
The two sides spent more than $90 million — rivaling the total amount Republicans and Democrats together had spent in Maryland over the past 14 years to wage four hotly contested races for governor.
Looked at another way, it eclipsed Maryland’s entire universe of political spending. It is more than the candidates for governor, comptroller and attorney general; the 404 candidates for the House of Delegates; the 114 candidates for state Senate; the 16 major-party nominees for the U.S. House of Representatives; and the four for the U.S. Senate spent altogether on elections to fill those offices’ current terms.
In the title fight, MGM Resorts will go down as the victor over Penn National Gaming. MGM is the largest casino operator in Las Vegas, and its spending to support the measure has positioned it as a favorite to develop an $800 million casino and resort at National Harbor.
If it does, analysts say, it could be the most lucrative casino on the East Coast and Penn National stands to lose a significant share of its revenue from Washington-area gamblers who now travel to its Charles Town casino in West Virginia.
“The people of Maryland have delivered a message: Sorting through an onslaught of dishonesty, voters chose to support progress,” said MGM chairman and chief executive Jim Murren.
The defeat breaks a string of ballot-box successes that has enabled Penn to limit competition through the midwest.
In Maryland, it bankrolled not only a ballot-issue committee that waged a nonstop ad blitz, but also put a local mayor, black community leaders and others in Prince George’s County on its payroll to speak out against the measure.
Penn’s line of attack — mostly centered on the uncertainties of whether more gambling would translate into higher spending on classrooms — appeared to resonate with voters early on. A Post poll in mid-October found widespread doubt that the measure would boost education funding as advertised.But after Penn’s message won over a majority among early voters, those who turned out to the polls on Tuesday backed the measure, including in Prince George’s, which had to endorse the measure for a casino to move forward there.
Political proponents appeared to gain traction in the closing days of the campaign by casting the decision as one about protecting Maryland jobs and revenue. They pointed to estimates from state analysts that say it could bring in $150 million annually for education by 2016, although similar estimates have proved overly optimistic from the state’s current casinos. The advocates also claim it could create some 12,000 new direct and indirect jobs.
Polls in recent weeks made clear that the ad deluge would make for a close vote — closer than in 2008, when Maryland voters overwhelmingly endorsed building five slots-only casinos.
Then, casino owners mostly banded together, viewing Maryland’s nascent market as lucrative for all. But in the years since, the casino market in the mid-Atlantic has stratified. To protect their competing interests, gaming companies spent like never before in a Maryland election.
MGM poured nearly $41 million into a campaign backing the measure.
Penn spent even more, seeking to protect its revenue from gamblers in Maryland who now travel to West Virginia.
With millions more from the Peterson Cos., the developer of National Harbor, and Caesars Entertainment, which wants table games at a Harrah’s-brand casino slated for Baltimore, the total spent for and against the measure topped $90 million, according to campaign reports filed Monday.
Despite such staggering comparisons, Maryland’s brief history as a gambling destination suggests the amount — and perhaps much more — could have been justified by casino accountants.
Maryland Live!, with its nearly 5,000 slot machines, has generated gross revenue of $128 million since it debuted at an outlet mall in Anne Arundel County in June.
For MGM to recoup its costs, a casino at National Harbor would need to clear a fraction of that, about $112,000 a day in its first year.
Similarly, some analysts say Penn National stands to lose a comparable amount.
On Tuesday, Gov. Martin O’Malley and Prince George’s County Executive Rushern L. Baker III (D), both of whom invested extensive political capital supporting the measure, made one last pitch to voters entering a polling station at Kettering Baptist Church.
“It’s an issue of whether we want to keep Maryland cash in Maryland or whether we want to continue to wave good bye to it in West Virginia,” O’Malley said.
A voter listening to O’Malley wasn’t convinced.
“It just doesn’t add up,” said Clayton Austin, 54, a federal employee who said he voted against Question 7. “I don’t see how it is going to help our school system.”