Nonprofits and State Government Fight Over Gambling Proceeds

The Washington Post reports that the Maryland legislature is considering a ban on electronic gambling machines throughout the state.  Some counties currently allow the machines if they are operated by nonprofit organizations.  These has led to some nonprofits relying on the machines as significant sources of revenues.  For example, Alternatives for Youth and Families, a charity that provides mental health services, received about $25,000 in two months from a machine it operates in a local liquor store in exchange for paying the store $50 per day.  The charity Center for Children, which also provides mental health services, reported similar revenues.

Supporters of the ban argue that the nonprofit operators do not receive enough of the proceeds from the machines, plus the availability of the machines has sharply cut into state lottery revenue.  They cite the fact that while state lottery revenue rose about 9 percent statewide over the past two months, it decreased by 5.39 percent in one county where the machines recently appeared in significant numbers, and decreased by 19 percent in establishments that feature the lottery but then added the machines.

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