May 27, 2020
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Panel gives OK to lottery expansion

AUGUSTA, Maine — A legislative committee is recommending that Maine allow the bingolike video game called keno and join the multistate Mega Millions lottery as a way to generate additional revenue during the recession.

But the committee remains divided over a proposal to allow Hollywood Slots in Bangor to offer poker and other table games ahead of a likely vote this fall on a resort casino in Oxford County.

And Gov. John Baldacci remains staunchly opposed to any expansion of gambling in the state unless it is approved at the ballot box.

Members of the Legal and Veteran Affairs Committee have been working for several weeks to find money to avoid cutting the executive director position at the Gambling Control Board, which oversees activities at Hollywood Slots. The position would be eliminated as part of Baldacci’s proposal for closing a $438 million hole in the state budget.

At the same time, the committee has been struggling to answer the pleas from veterans’ groups and other nonprofits that formerly earned money from pay-to-play video poker terminals — that is, until state police began cracking down on the machines.

By joining the more than 30 other states that offer the big-ticket Mega Millions lottery game, Maine could expect to take in an additional $1.5 million annually after accounting for decreasing sales of other lottery games, according to the committee.

Joining Mega Millions also could produce about $250,000 in the fiscal year that ends June 30. That money then could be used to fund the Gambling Control Board’s executive director position now held by Robert Welch, Bangor’s former deputy police chief.

Sen. Nancy Sullivan, D-Biddeford, said there are strong concerns among Legal and Veterans Affairs Committee members that the state is weakening oversight of Hollywood Slots. That is particularly worrisome, she said, given the fact that another group, Black Bear Entertainment, is hoping to gain voter approval later this year for a resort casino in Oxford County.

“We need a system that works as it continues, probably, to grow,” Sullivan told members of the Appropriations and Financial Affairs Committee. “This has been well vetted among this committee.”

Baldacci spokesman David Farmer said while it is understandable that the committee wants to preserve the executive director position, the governor would not support expanding the state’s lottery offerings.

“The governor is not a fan of the lottery,” Farmer said.

A second proposal to authorize keno — an electronic hybrid of the lottery and bingo — would generate an estimated $2.3 million for the general fund in fiscal years 2010 and 2011.

Bars, restaurants and nonprofit groups with on-premises liquor licenses could apply to become keno licensees. Under one proposal, both for-profit and not-for-profit keno locations would receive a commission of 5 percent; a second proposal would offer nonprofit groups a 10 percent commission.

But, again, Farmer indicated that a keno proposal is unlikely to get by the governor’s desk.

“This is a new game and it would have the potential to spread to new areas,” Farmer said.

The keno proposal was intended as a compromise for nonprofit groups that no longer can offer video poker terminals that award winners a cash prize. But the compromise fell short for some groups, including the state’s American Legion posts.

Donald Simoneau, an American Legion member who tracks legislative issues on behalf of all of the posts, pointed out after Thursday’s meeting that only 20 of the 175 halls in the state feature full-time clubrooms with liquor licenses. That means the vast majority of halls would not benefit from keno, Simoneau said.

Meanwhile, many of those posts are struggling to get by, much less continue to offer the community outreach and services they once did, Simoneau said.

Legal and Veterans Affairs members were much more divided over the issue of authorizing Hollywood Slots to add table games to its operation near downtown Bangor. Four committee members supported the idea while six did not.

Hollywood Slots officials estimate table games could generate $8.3 million for the facility, which in turn would funnel roughly $1.3 million into the General Fund.

The majority of members appeared to support the concept of granting Hollywood Slots’ request for table games. But the lawmakers disagreed on the specifics, such as a proposed $5 million license fee in the first year. Several lawmakers on both committees expressed concerns about attempting to push forward with the Holly-wood Slots proposal before the likely vote this fall on the Oxford casino.

Rep. Linda Valentino, D-Saco, said the issue needs more exploration.

“Even though I do in theory agree that Hollywood Slots should have table games, there is a lot more negotiation that needs to be done and it may not happen this legislative session,” Valentino said.

The Appropriations Committee will consider the gambling-related proposals at a later date.

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