As Maryland politicians wrangle over holding a special session to expand gambling, the state's newest casino surged out of the gate, reporting revenue of more than $1 million a day in its first month.
Gambling operations at Maryland Live Casino brought in $28.5 million during the facility's first 25 days, or nearly 70 percent of the state's total gaming revenue in June, the Maryland Lottery announced Tuesday.
The operation's gross gambling revenue was $359.27 per day per machine — a figure that lottery director Stephen Martino expects to decline in the coming months.
"My guess is it's not sustainable over the long term," said Martino, explaining that per-machine revenue will likely drop as the casino's novelty wears off and the number of machines at the facility grows.
Maryland Live estimated that the casino had 500,000 visitors in June. Joe Weinberg, managing partner and president of gaming for the Cordish Cos., which built and operates the casino, said the June results were "right in line with projections."
The casino, which opened the evening of June 6 at Arundel Mills mall in Anne Arundel County, currently has 3,171 games. By the end of September, it is expected to have 4,750 slot machines and electronic table games, Weinberg said.
A live entertainment venue is expected to open there by September, and an upscale steak house — the casino's finishing touch — will open by early November, Weinberg added.
James Karmel, a gaming analyst and Harford County Community College history professor, said that while it's difficult to judge based on one partial month, the numbers from Maryland Live suggest it is drawing business away from the casino-racetrack complex in Charles Town, W.Va. The per-machine take is strong by industry standards, he said.
"So far, Maryland Live has had a successful debut as far as opening earlier than expected, attracting a lot of media and creating something of an image of a big-time casino," Karmel said.
The new casino paid out more than $169 million in winnings in June, with about $6.8 million paid in jackpots of $1,200 or more, according to a statement Tuesday from Maryland Live.
Two-thirds of casino gambling revenue is paid to the state in taxes, with nearly half of the revenue going to the state's education trust fund, which collected $94.3 million in fiscal year 2012. Maryland's three casinos generated revenue of $194.5 million during the fiscal year, which ended Saturday. The Maryland Lottery tracks gross gambling revenue, which does not include winnings paid out.
Maryland Live paid just under $19.1 million in gaming taxes to the state for June's operations, the casino reported Tuesday. The casino's share after state taxes is about $9.4 million.
With two-thirds of its gaming operations up and running, and over a partial month, Maryland Live paid $13.8 million toward the education trust fund. If revenues continue at this rate, taxes collected will be below pre-opening estimates by the Cordish Cos., which projected the fully operational facility would generate $400 million for the education trust fund annually.
The revenue rate will increase once all the slot machines are in operation, Weinberg said.
The remaining gambling taxes collected help the state's horse-racing operations, fund local impact grants, and support small businesses and minority- and women-owned companies.
Two percent of casino gambling revenues go to the Maryland Lottery to pay for oversight of the casinos' operations.
The state's other two casinos had a mixed June. Combined, their revenue was down 2 percent compared with June 2011.
That decrease is largely a result of Maryland Live siphoning revenue from its nearly 2-year-old competitor, Hollywood Casino Perryville, Martino said.
Hollywood, about an hour's drive north of Maryland Live, brought in $8 million in gambling revenue in June, down 9.8 percent from June 2011. The Cecil County casino, which opened in September 2010, has 1,500 video gambling units. In June, its gross gambling revenue per machine per day was $176.84.
"It's not a surprise that Maryland Live is taking some business from the Hollywood table," said Karmel, adding, however, that 10 percent is higher than he expected.
June's results may reflect the novelty of Maryland Live — with some gamblers who live closer to Perryville wanting to check out the new casino in Anne Arundel, he said.
The two casinos are far enough apart that they draw from two distinct regional groups, Karmel said. He said he would only conclude Maryland Live was a serious drain on Hollywood Casino Perryville if it shows a sustained 10 percent decline in revenue after several months.
The Casino at Ocean Downs, in Worcester County on the Eastern Shore, took in roughly $4.4 million from its gambling operations last month — a 16 percent jump from a year ago. Martino attributed the revenue increase at the casino, which opened in January 2011, to improved marketing in and around Ocean City, less than 10 miles from the horse-racing and slots site.
Ocean Downs, which has 800 games, reported a daily take per machine of $183.15 in June.
Sen. James Mathias, a Democrat who represents the Ocean City area, said the local casino's improved results in part reflect a better working relationship between casino owner William Rickman and local government officials. Mathias said the traditionally gambling-wary Ocean City business community now views the Ocean Downs slots less as a threat and more as an opportunity.
Casino ads on Ocean City buses and Ocean Downs' sponsorship of the resort city's air show represent a new dynamic, Mathias said. "We're seeing the relationship build," he said.
Maryland's casino program appears to be making progress, Mathias said, with Maryland Live off to a good start, a licensed operator chosen for Rocky Gap in Allegany County, and a license award apparently close for the site planned along Russell Street in Baltimore.
The five sites authorized by the Maryland General Assembly now offer slot machines only, though there is strong support in the legislature for permitting table games as well. However, while House leaders appear ready to approve table games with no strings attached, the Senate seems determined to couple any such expansion with a new casino in Prince George's County.
Cordish is fiercely resisting any such trade-off, insisting that it's too early to say whether the Baltimore-Washington market can support another casino.
Roughly half of Maryland Live's June customers came from the District of Columbia, Maryland's Washington suburbs and Virginia, Weinberg said. "It is clear that if we are going to continue to meet the state's expectations, we have to be able to continue to draw visitors from these areas."
Advocates for a casino at National Harbor on the Potomac River — the Prince George's site with the most political backing — contend that such a facility could provide significant new revenue for Maryland and the county by drawing out-of-state visitors and international tourists.
Last month, Gov. Martin O'Malley and Senate leaders agreed on a program that would allow both the Prince George's casino and table games at all casinos — along with a lower tax on slots revenue — in the hope of calling a special session this summer to approve the plan. But the House has not budged and prospects of a special session are fading.
O'Malley met for about an hour with House Speaker Michael E. Busch Tuesday afternoon to discuss expanding gambling in Maryland, and afterward told reporters he is "continuing to search for a consensus on this long-lingering issue."
The governor said he hasn't "made a final decision" on whether or not to call the legislature to a special session on July 9 and will make that determination on Thursday or Friday.
Baltimore Sun reporter Annie Linskey contributed to this article.
Maryland Live Casino
Anne Arundel County
Opened June 6, 2012 – $28.5 million
The Casino at Ocean Downs
June 2011 – $3.8 million
June 2012 – $4.4 million
Hollywood Casino Perryville
June 2011 – $8.8 million
June 2012 -- $8 millionCopyright © 2014, Los Angeles Times