MR. KOJO NNAMDIFrom WAMU 88.5 at American University in Washington, welcome to "The Kojo Nnamdi Show," connecting your neighborhood with the world. Maryland casinos are cashing in while other gaming industries are going bust. Since the Baltimore Horseshoe Casino opened in late August, it's been pulling in about a million dollars a day in revenue, contributing to a record 80 million dollars in the state's gambling take in the month of August. It wasn't long ago when those looking for blackjack table or blinking slot machines had to head all the way to Atlantic City.

MR. KOJO NNAMDINow, casinos are popping up all over I-95 in Maryland, Hanover, Baltimore and soon, Prince George's County. While many think the Old Line State has hit the jackpot, others worry. Fragile industry and potential problems with gambling addiction could foreshadow a darker future. Joining me now to discuss this is Annys Shin. She's a reporter with The Washington Post. Annys, thank you for joining us.

MS. ANNYS SHINThanks for having me.

NNAMDIAlso in studio with us is Keith Whyte. He's Executive Director of the National Council on Problem Solving. Keith, thank you for joining us.

MR. KEITH WHYTEThank you, Kojo.

NNAMDIAnd Jeff Barker is a reporter with The Baltimore Sun. Jeff, thank you for dropping in.

MR. JEFF BARKERThank you.

NNAMDIYou too can drop in on this conversation by calling 800-433-8850. What do you think about using casinos for government revenue? Is that, in your view, a good strategy for stimulating the economy? 800-433-8850. Or not. You can send email to kojo@wamu.org. Send us a tweet @kojoshow or go to our website, kojoshow.org and join the conversation there. Annys, the Horseshoe Casino in Baltimore, owned by Caesars Entertainment Corporation, opened late last month, joining Maryland Live and the Hollywood Casino in Perryville as the third major gaming spot off I-95.

NNAMDIAnd there are plans to build an MGM Resort in Prince George's County in two years. When and how did Maryland turn into a gambling state?

SHINWell, it's something that basically has been an idea to generate tax revenue in Maryland for many years, but it was hotly contested. The legislature was deadlocked over it for years. It actually took Marin O'Malley, of all people, (laugh) who has been critical of...

NNAMDIOh yeah.

SHIN...gambling, as a source of tax revenue, to call a special session. And they -- the legislature finally came to an agreement. They put a initiative -- a ballot initiative, the voters approved it for slots, initially. And then table games and this is where we are now, with five casinos.

NNAMDIFor a long time, people had to go to Atlantic City if they wanted to play poker or slots. Then Delaware and Pennsylvania. Now, with Maryland and Ohio, casinos seem to be expanding more and more throughout the east coast. Why is that?

SHINBasically, it's sort of a domino effect. One of the things that broke the log jam in Maryland is the fact that Pennsylvania legalized it. Essentially, you know, when the recession hit, all these state governments were really strapped for money. They couldn't raise taxes. So, gambling suddenly became a much more appealing source of revenue. And one by one, each state legalized it and that's why you're seeing -- Massachusetts, right now, I guess is considering repealing theirs, but New York last fall also approved legalized gambling. Ohio did a few years ago, and that's why you have this great expansion in the northeast.

NNAMDIMassachusetts is considering repealing theirs?

SHINThey are. Yes.

NNAMDII didn't know that. Jeff, the whole casino movement seems to have happened fairly quickly with several major gaming spots opening up along I-95, over just a few years. What do politicians, what do taxpayers hope to gain from that?

BARKERWell, I think there's some ambivalence. I've always been struck by it. I know the Post, in fact, had a good story about Governor O'Malley from Maryland, and how he showed up at the opening of the Horseshoe. But he didn't stay long. And I spoke with Congressman Elijah Cummings that same night and he said the same thing. He said you know, I don't love gambling. He said, I'm not a gambler, but I couldn’t resist the jobs. And he said, I look around and I see how many of my constituents weren't working and are working now. And I think that's what politicians gain.

BARKERAnd I think the other thing is if you remember when the slots referendum was passed in 2008, Maryland was facing a budget shortfall. And that was another, you know, elixir. That was something that politicians were attracted to is all that revenue.

NNAMDINow that casinos have been up and running for a few years, how successful have they been?

BARKERThey've been doing well. I mean, Maryland Live, people sort of raised their eyebrows. Even their competitor now, the Horseshoe in Baltimore, when I spoke to them about Maryland Live, they said wow, you know, they're doing even better than we thought. Now, the question is, of course, do you hit, you know, a critical mass? Do you, if you keep adding casinos, do they keep on doing well? But I know Maryland Live, for a number of reasons, has done even better than the organizers hoped it would.

NNAMDIKeith, you run an organization dedicated to dealing with problem gambling. But you don't oppose the casinos. What kinds of concerns do you have about developing casinos specifically with the new location in Baltimore?

WHYTEWell, we think that there are clearly economic benefits to locating casinos, for example, in an area that's economically depressed, socially disadvantaged. However, those are also the places where we already know that addiction to gambling is clustered. So there's a cost/benefit here that I think the state has to be cognizant of. And I think, you know, as Jeff said, it's all too easy to look at the benefits. The taxes and the jobs created. And it's a lot harder, I think, to look at these social costs.

WHYTESo, you know, we have -- so, we're not opposing, nor are we supporting the casinos. But we are concerned that without enough measures to mitigate this impact, especially on known vulnerable communities, the state is going to generate a lot more costs than they're anticipating.

NNAMDIThere are already some regulations in place to handle gambling addiction. A portion of casino revenue has to go to treatment programs. We see the support line number at the end of all the advertising. How do you assess the efforts to deal with problem gambling?

WHYTEI guess we would give it a C. Because I think one thing they did is it's dramatically underfunded. So we would recommend one percent of revenue, which last year, would have been about 23 million dollars. The state's spending about two. So, they're spending less than one tenth of one percent of this new money to mitigate the social costs of gambling addiction, which last year, we estimated 139 million dollars. So the state is clearly not spending anywhere near enough.

WHYTEThe other thing that you mentioned is that none of the money, so far, really goes to reimburse for treatment. So you do -- you call the help line. You get, you know, you go and you do what -- you see the billboards. And the state isn't reimbursing for outpatient treatment right now. That's hopefully coming soon, but for four years now, they've left people on the lurch while they're making hundreds of millions of dollars in windfall.

NNAMDI800-433-8850. To what extent is the government responsible for assisting with problem gambling? Should casino revenue pay for all addiction treatment? What is your view? 800-433-8850. You can send email to kojo@wamu.org. Don your headphones, please, because we're about to hear from Alfonso in Silver Spring, Maryland. Alfonso, you're on the air. Go ahead, please.

ALFONSOHi. Thank you so much for taking my call. This is an issue that's been very frustrating to me as a Maryland resident, Maryland Democratic voter. I consider myself quite progressive in one of the bluest states in the Union. And I'm gonna make a comment, but it's a comment I'd like the panelists to respond to. I've been ashamed, I'll go as far to say that, of my progressive government representatives. O'Malley, especially. And others in the state, as well as some of my friends and family in the state who I don't think thought deeply enough about this issue.

ALFONSOAnd here's why. I think you eluded to this earlier. It is my understanding that when you look at an impact on a family's income and individual's income for problem gamblers, the poorest residents of our state are going to be hit the most negatively by problem gambling in the state. So we're exploiting our own citizens, in the state of Maryland, to increase tax revenue, in one of the bluest states in the Union, where Democrats have enormous power to make positive change, create an export economy, do things that both support citizens in the state, grow our job base without exploiting the citizens themselves. I'm very curious to know what your panelists would think about that.

NNAMDII'll throw it to them. I'll start with you, Keith Whyte.

WHYTEWell, in 2011, the state did a very good job at funding a baseline prevalent study. And just a couple quick stats from that. African-Americans have twice the rate of gambling problems as, you know, the Whites or Hispanics. If you have an income of 15 thousand dollars or below, 15 percent of Maryland residents met criteria for gambling problems versus two percent for incomes of 100,000 or above. And last, if you have a high school degree or less, again, 15.3 percent of Marylanders, in 2011, met criteria for gambling addiction.

WHYTEIf you have a college or a graduate degree, it's less than one tenth of one percent. So I think there's no question that gambling addiction has a disproportionate impact on those most vulnerable in Maryland.

NNAMDICare to comment, Annys?

SHINUm.

NNAMDIBeyond, beyond what Keith has said? You don't have to.

SHINNo, I don't have anything to add to that.

WHYTEAnd it's entirely possible that they may have even more. I mean, this is 2011. This is before casinos really expanded, and certainly before they were located centrally in some of the most disadvantaged areas. So, we could be -- we could be looking at an increase in these numbers.

NNAMDIAlfonso, thank you very much for your call. We move on to Dennis in Washington, D.C. Dennis, you're on the air. Go ahead, please.

DENNISYeah, how are you doing, guys? You know, we -- part of their business license -- when they apply for their business license, I think the requirement should be that one half of their profits, only -- if they break even, they break even. They don't have to pay anything. But if they have profit, one half of that profit goes into an earmarked fund for an enterprise program. In other words, creating businesses and getting young entrepreneurs or even any age entrepreneur with a good idea, to promote that idea with profits from the casino.

DENNISSo that builds community, as opposed to just, you know, just hogging the profits...

NNAMDIWell, what do you say to people who say, look, the purpose of starting a business is to make a profit. The purpose of starting a business is not to expect some charitable assistance.

DENNISYes. You know what, if you're producing something, if you're producing chairs or producing bridges or roads or cars or some products. Or some service. You know, it seems like that would be a good idea. But it just seems like this is just pure profit. They pay their employees, and everything else is just gravy. And that's not producing anything for the culture or for society or for the county or for anybody. What they should do is maybe earmark it for gas. Take tax off the gas with the profits from the casino.

DENNISOr, and I like better the enterprise idea where they have this fund and you put it in, you know, in an escrow or into a fund where it grows. Just like some of these foundations, like the Bill Gates Foundation, whatever it is, and you take that money and you put it into maybe a...

NNAMDIWell, you know, Dennis, there are a variety of ideas. We end up with education right now. But there are a variety of ideas that I'm sure you and others have for how profits or funds or revenues from casinos can be used more effectively. We had a call who couldn't stay on the line, who said the initial referendum for slots was sold as a way to save the horse racing industry. That was the original idea, but that never happened, and we now got the worst case scenario.

NNAMDIGambling is something we're going to pay for in the next five to 10 years. What happened to saving the horse racing industry, Jeff?

BARKERIt happened a little bit. But no, you're right. And I covered the sessions in Annapolis years ago, and I know that was the big push. Because people imagined that there would be these racinos. You know, they would end up with slots at the tracks. Which didn't happen, but there is still a percentage of the revenue the state takes in from the casinos that does go. And I've noticed this, because I cover horse racing some, that the purses have increased, and therefore they are able to get larger fields in some of the horse races.

BARKERBut one other thing that the caller mentioned. Now, Baltimore was very much a partner in this. More so, I mentioned politicians having ambivalence. But one of the reasons Baltimore partnered is -- and I'm gonna read this line from a story we had. It said that, "the deal with Horseshoe in Baltimore calls for the casino to pay the city at least 11 million dollars in lease and profit sharing agreements and property taxes during its first year." So, I think that helps explain partly why Baltimore was so onboard with this.

NNAMDI800-433-8850. Jeff Barker joins us in studio. He is a reporter with The Baltimore Sun. Annys Shin is a reporter with The Washington Post. And Keith Whyte is Executive Director of the National Council on Problem Gambling. We're talking about casinos in Maryland, the purpose for which they exist, and if it's going to lead to gambling addiction problems.

NNAMDIWhat lesson should we learn from Atlantic City's struggling economy? How can Maryland avoid losing revenue to other states? 800-433-8850. Annys, one of the concerns about the growth of casinos, is the market getting too crowded? It makes sense to open one outside of Atlantic City to provide a closer option for some gamblers. But if more and more pop-up, they might be taking business from one another. Can all of these casinos survive successfully?

SHINWell, that's the big question. And there are some signs already that it may not be sustainable. So Philadelphia, PA is in the process of awarding their last license. It's going to be another casino in Philadelphia. The existing casino there is fighting it tooth and nail, and you might expect that from a competitor. But their slots -- the statewide slot revenues are down for two years in a row. So there's already fear that there's cannibalization occurring.

SHINYou know, the industry thinks that it's still possible -- one of the criticisms in Atlantic City that the industry has put forward is that the government wasn't responsive enough. It wasn't just a question of investment or whether, you know, Revel was a good -- a well-planned casino or not, but also taxation rates. And this is something that may -- Maryland may have to deal with down the road.

SHINBut, you know, as you were saying, this -- sort of the compact that voters made is that they're going to get tax revenue out of this. But there may be a scenario in which the industry is going to come back and say, to sustain all of these casinos, you're going to have to lower our taxes at some point. And I don't know, you know, how voters are going to feel about that down the road. Well, that could be coming.

NNAMDIAnd Keith?

WHYTEAnd reduced regulations and expand operating hours. We saw that in Maryland, even before the casinos were fully built out, they'd already changed a lot of the restrictions that were initially put in place. You know, some of them, not all of them, were involved with gambling addiction. But, you know, 24-hour nature and things like that. So I do think we see this -- you have to look at this as a regional issue.

WHYTEAnd there are going to be certain states that are going to be very competitive and they're going to try and do everything they can to increase or to keep the gambling dollars there. And then there are states like -- there's areas like D.C. that are just -- they're going to reap none of the profit and most of the cost.

NNAMDIGot to take a short break. If you have called, stay on the line. If you'd like to call, the number is 800-433-8850. You can send email with your questions or comments to kojo@wamu.org or shoot us a tweet @kojoshow. We're discussing casinos in Maryland. I'm Kojo Nnamdi.

NNAMDICasinos in Maryland, they're raising both money and questions. Joining us to talk about that is Annys Shin, she is a reporter with the Washington Post, Jeff Barker is a reporter with the Baltimore Sun, and Keith Whyte is executive director of the National Council on Problem Gambling. You can call us at 800-433-8850. Atlantic City's gaming industry is struggling. They've put on promotions to try to attract people from places like Philadelphia to come back. But three of their casinos are expected to close as they see their revenues dip. What should we be learning from them, Jeff?

BARKERWell, I think -- we use the term regional here already. I think that is the message now. I think that the reason that Baltimore and D.C. is gambling on gambling is because they look at the population. I mean, you look at northern Virginia, I mean, look at Fairfax County and Loudon, they're among the fastest growing counties in the country. So, I think that that's part of the thinking behind the National Harbor, the casino that's going to open up in 2016.

BARKERI think they feel like it's not so much a destination as gambling used to be thought of with Vegas and Atlantic City. It's thought of as we're going to get the locals.

WHYTEMm-hmm. Absolutely.

NNAMDIKeith?

WHYTEConvenience gambling is the name of the game now. And why would you want to drive past one casino to go to another one? You know, we know that basically gaming machines, in whatever form you put them, whether it's a VLT, a track or a slot machine and casino, that's really the big driver of gaming revenue. And the closer you are to those, you can make it, not a weekly trip but then a daily trip, the more revenue. But obviously the more cost.

NNAMDIAnnys, it seems there's a kind of domino effect here. If one state has gambling, the next state over wants to get in on the action. Do you think Virginia is likely to consider casinos once their residents start taking their money over to Maryland?

SHINWell, that's a big question. I mean, they're one of the very few holdouts left. But once they see millions of dollars, you know, marching across the river over to Prince George's County, I'm not sure they're going to want to sit it out any longer. And there are -- there is support for the idea further south in Norfolk. There's some legislators from the Tidewater area who are much more interested in it. It's a very complicated issue in Virginia and they've had a long standing resistance to it. But, you know, again, money talks, jobs, you know, all the same things that got the other states to cave.

WHYTEAnd it's not as if Virginia is not involved in gambling. You know, they have a very aggressive lottery, even though it's marked as a gentile lottery, they're making -- I think it's $350 million a year. We have racing and there's obviously -- there's now a lot of machines in bars that are instant racing. But I think one of the big obstacles to Virginia is the situation with the tribes. And, you know, tribes are generally allowed to engaged in forms of gambling that the state allows.

WHYTEAnd by -- if Virginia legalized casinos or even slot machines, it would -- it might allow those tribes to establish casinos as well. And I think that would be (unintelligible) in many Virginia politicians.

NNAMDIOn to the telephones. We will go this time to Will in National Harbor. Will, you're on the air, go ahead please.

WILLHello. Your guest had mentioned that there may be some unaccounted for societal costs. And presuming that it -- the gambling goes as, I think, the proponents have asked to go and it is successful and they're not asking for things like tax breaks because they're doing so badly but they're actually doing well. What do you think of the possibility of increasing taxes on the casino industry in Maryland and how that mechanism would actually come to be?

NNAMDIJeff?

BARKERWell, I think that's something that could be considered. I know -- that's a very delicate negotiations when they, you know, when they negotiate these things and they'd come out with how much is the state's, you know, share going to be, how much is the casino operator's share, how much is the purse for, you know, horse racing and all that. But I agree that's something that certainly could be revisited.

SHINMaryland is actually unusual. They -- each casino has a different tax rate. And the rates actually are designed to go down when another one opens, slightly. So according to the operators, that's very unusual in the United States. But they already -- Maryland already has sort of an unusual tax rate.

NNAMDISo raising the tax rate is not on the agenda right now, Will. We move on to Nicole (sp?) in Olney, Md. Nicole, your turn.

NICOLEHi. I just wanted to put in that as a Maryland resident, we were very, very much against casinos here, part being my fiancé, he is a gambler. It's something he likes to for fun. And one thing he noticed is that he didn't think the neighborhoods that he visit casinos in were that nice and he didn't want that in his backyard. And for a living, I go into people's home, I do interior design throughout the area. And especially in the Maryland Live area, there's been an increase in crime.

NICOLEWe've seen a lot of children being abandoned in cars as a result or elderly people. And in specific, a customer had her car taken, NASCAR style, her tires off of her Escalade. And the neighbor said they thought they heard something. And then five minutes that they'd taken her -- all of her tires and her rims and when the cops arrived, they said there were many cases like this. And I had heard nothing of this in the news.

NICOLEBut it is very much increasing the crime, and it's just not something you really want. I mean, you are feeding off of the people and then you're going to help them with that money in turn. It just -- it just doesn't seem necessary just, you know, there's other ways to do it.

NNAMDISo let me get this straight. Your fiancé says I love hanging out in these neighborhoods, but I wouldn't want to live in one?

NICOLENo, it doesn't love hanging out in them. He used to gamble a lot and that was something that he had to change in order to be with me. I was like, that's the dumbest thing I ever heard of. You're playing with me. I'm like, you're playing with money, like you're going to go someplace and maybe you make money? No, no, no, no, that doesn't work. I was like, that's the most -- these places only exist because we lose. I was like, do the math. You're losing.

NNAMDIOkay. Well, we need to mend a relationship. But, Keith, I'm just wondering if in fact the level of crime does tend to increase according to what statistics show. We are not only talking about addiction here, we're also talking about higher levels of crime?

WHYTEYou are. And I think -- but it's a more complex relationship than that. Because I think, to be fair, casinos attract enormous amounts of visitors. And much of the crime increase that we've seen over the past, you know, we've been doing this 19 years now, is really opportunity crime. You know, where there's more people, there's more crime. And it's just -- it's not really the nature of the casino so much as if you built a theme park there or something like that.

WHYTEHowever -- but it is also true that, you know, gambling addicts are much more likely to commit crimes to finance their gambling. Almost 70 percent of members of Gamblers Anonymous report committing a white collar crime to finance their gambling. So not ripping off someone's rims necessarily, but check fraud and embezzlement. So, you know, I think it's -- I think it's a little -- it's probably a little bit of both.

WHYTEAnd the founder of our organization said there's a difference between a gambler who steals and a thief who gambles. And that -- I think that helps explain some of that relationship. It's both crime by addiction and crime sort of because there's an opportunity.

NNAMDI800-433-8850. Have you visited the casinos in Maryland? What do you like or not like about having them nearby? 800-433-8850, you can go to our website, kojoshow.org and join the conversation there or send us email to kojo@wamu.org. Jeff, one of the selling points of these casinos is neighborhood revitalization by bringing in all these new business, this new money. More businesses will pop up and help develop the entire area. But some people worry about a place for drinking and gambling being an anchor for development. Do you think that's a legitimate concern?

BARKERYeah, I mean, I think it's all legitimate until we know what happens. I mean, to me, I covered when Nationals Park came to Washington. I covered the D.C. Council hearings and there's all the talk about what was going to happen to that neighborhood, same with Camden Yards when that opened in Baltimore. As reporters, I think it's our job to, you know, to see if the, you know, if the promises do occur and whether the neighborhoods do improve.

BARKERI know I can say in Baltimore, there are high hopes. And one of the reason is because the Horseshoe Casino in Baltimore does not have a hotel attached to it. And so I know the hotels are all excited and there's a hotel right next to it that's seeing an improvement of business. So, you know, maybe the -- there will be a spillover effect from the casino. But at the same time, casinos often like to keep you inside their casino as well.

NNAMDINeighborhood revitalization?

WHYTEWell, Atlantic City is a cautionary tale. You know, the way the zoning was, the way the tax revenue that went to the -- the state capital and not necessarily back into Atlantic City. They did not have a lot of ancillary development. You know, people came in, gambled and got right the heck back out. In other areas, I mean, I think urban casinos are a big challenge. In Detroit, we haven't necessarily seen the revitalization nor New Orleans and some other places.

WHYTEBut it's certainly possible. And in Maryland, I think, you know, The Mills is doing incredibly well, and that may be -- that may be a new model in more of a suburban location with lots of malls and other infrastructure that's already there that could possibly expand.

NNAMDIHere's David in University Park, Md. Hi, David.

DAVIDHi, Kojo. My feeling on this is I think, unfortunately, Maryland is going all in at just the wrong time. I think saturation point -- Atlantic City, I think the Pennsylvania casinos are going to start to see declines down in the Gulf Coast. And I think Martin O'Malley's ambitions are going to suffer because of it. And he wasn't a big supporter. He did everything he could to kind of dodge the issue, but I think, unfortunately, he's going to pay.

NNAMDIAnnys, Marin O'Malley seems to be halfway in and halfway out when it comes to casinos. Obviously, he was a force in making them come to the state of Maryland, but he doesn't -- he clearly doesn't want himself to, I guess, too easily attached to that issue.

SHINHe -- it's interesting at the opening of Horseshoe, the -- to set it off, they had a giant lever, you know, slot lever that you're supposed to pull and it was very obvious that he was not one of the public officials who was going to pull it. He's sort of aware of the optics of what that looks like. So he let the head of the agency, the gaming control agency do it, which is kind of interesting because they are the regulator, but anyway -- yeah, no, we'll see how it plays. I mean, it's sort of unclear in terms of what his national ambitions are because so many states have embraced casino gambling. I don't know honestly how much it's going to hurt him.

NNAMDIWhat's the downside for him in terms of his national ambitions?

BARKERI mean, I think you could possibly get called on being a hypocrite. I mean, he keep -- clearly, this was, you know, politicians don't like decisions where there is so much of a gray area. And he clearly was ambivalent. And I think it's a lot easier in politics when you -- when you take your position and you stand by it a hundred percent and clearly he was not. And so, I think that there could be room for him being attacked. There's such a saying of why didn't you have the courage of your convictions and oppose it? Somebody could say that to him, I guess.

WHYTEAnd I think you look at Governor Christie now. I mean, he had made a big bet on Revel to try and put all sorts of tax credits and he was going to revitalize Atlantic City. And now, you know, people are really calling him out on that now that it's gone bankrupt. And I think in Maryland -- I think particularly for this administration, they're -- in our view, their failure to really aggressively address problem gambling may well come back to hunt him.

WHYTEI mean, there are going to be ruined families and broken homes because of this expansion. And, you know, I think that's something that no politician really wants to address. But -- and again, it's unfortunate because I think you can get ahead of this. But Maryland is not -- Maryland is 18th in spending in problem gambling addiction. And that's -- that's not enough.

NNAMDIWhat are the prospects for increasing that?

WHYTEVery little is -- as I understand, because as Annys said, this -- Maryland's funded it uniquely, so it's a fee per slot machine. And unless that fee is increased, you know, it doesn't float with revenue, it doesn't expand it and add anything more to table games. So, you know, we'd certainly were eager to do that. We need -- I think it needs to increase by a factor of 10. But, yeah, that's hard to gauge.

NNAMDIJoe in Oxon Hill, Md. You're on the air, Joe, go ahead please.

JOEYeah, I was talking about Maryland Live and your casinos in the state of Maryland, where as I was talking to the employees there regarding their tax base and they say they pay 62 percent of their taxes to the state of Maryland, which I would say everybody is paying that, every -- all the casinos?

NNAMDII don't know for sure. Jeff?

BARKERI think as Annys said, I think it breaks down differently. I don't have the figures in front of me.

NNAMDIYeah, it breaks down per slot machine. Right?

SHINYeah, it's not the same for each one.

NNAMDIIt's not the same for each one, Joe.

SHINAnd over time, it also fluctuates. So...

NNAMDIIt changes.

JOEWhere does the money go? Where do this go regardless? It's -- it's millions of dollars.

SHINIt goes...

JOEAnd your state wants more money for taxes.

SHINIt goes to the educational trust fund and also to the general fund. Some of it goes to the horse racing industry.

BARKERSome of it goes to horse racing. I mean, I know the education trust fund, I know some of it is used for school's constructions. I know that. And some of it goes to early childhood education.

JOEOn tax -- now, you know, for the taxpayers, I live -- I live -- I pay 52 percent to schools.

NNAMDIYes.

JOEYou know? And I'm retired. I'm a senior citizen, a veteran and I don't get break. You know, I ain't got no business for these.

NNAMDISo you don't see where all of this money is what you're saying, Joe?

JOEI don't see where any of the money is going. And when you say -- when they say 62 percent goes to the state out of one casino and Maryland Live is the top casino in the state of Maryland for income, where does, why would you want more money that you're getting free money.

NNAMDIJeff, what do we know about exactly how much assistance is going to the education system in the state of Maryland?

BARKERWell, when you -- if you look at the figures, I think that the money that the casino operators are getting generally is about the same as the money that's going into the education trust fund. I think it's pretty even. And then take the leftover money and some of that goes to the horse tracks. And I think somebody else gets some of it as well. But it's, you know, they divided up the pot. And, you know, clearly, the state felt like it had an interest but it had to, you know, make sure that the casino operators are on board and give them a big share as well.

NNAMDIHere's Robin in Ellicott City, Md. Robin, your turn.

ROBINHi, Kojo. Thank you so much for taking my call. I love your show.

NNAMDIThank you.

ROBINAnd my -- my question goes to the whole issue of the money having been promised quite a bit of it to education.

NNAMDIYes.

ROBINAnd I feel like the speaker who just kind of talked around that issue and I would really like to know what the percentages are because our schools are starving for money. Very few classrooms have what they need. And this lottery system was based on promising education getting quite a bit of the funding. So I will end there, and hopefully get a real answer.

NNAMDIWhen you called -- when you called, Robin, you identified yourself as a teacher. Are you a teacher in the public school system?

ROBINI am a recently retired, 18-years' worth of teaching. And so, I mean, literally just retired. So I'm not, you know…

NNAMDIBut she's not seen the money going to the schools, Keith Whyte.

WHYTEWhere there was an interesting study a number of years ago, now.

ROBINThank you, Kojo.

WHYTEThat showed that states with lotteries that were dedicated to education, actually spent less overall on education than states without lotteries that were dedicated to education. And I think the theory behind this study was that voters, when they approve a lottery to fund education, what they assume is that this is new money that's going to come on top of an existing budget. And what happens in most states is that that existing education money is then siphoned into some other pool, and that the new lottery money then becomes the sole funder of education.

WHYTESo I think that's -- it's not an uncommon thing. And that's really a function of government, not necessarily lotteries. But, yeah, we -- I wouldn't -- I would caution anybody to expect that just having this is going to somehow magically transform the educational system.

NNAMDIJeff?

BARKERYeah, just to add as statistic here. So this is from the state regulatory site. It says, "Casino gaming at the state's four operating casinos," and this was before the last one came online, "generated $833 million in revenue and $328 million was sent to the state's education trust fund." So that gives them an idea of the percent. But I know there is a need. I have a 10-year-old daughter in elementary school in Maryland. I know she has like portables outside because they just don't have room. And they -- clearly they, you know, school construction is obviously, yeah, a huge need.

NNAMDIAnd I think that's what people want to see. When they hear that money is going from the casinos to the schools, they know how much money the casinos are making. They expect to see instant and clearly evident improvements in every school that they look at. Fortunately -- unfortunately, it doesn't happen quite like that. Got to take a short break. When we come back, if you have called, stay on the line.

NNAMDIWe will get to your calls. If you'd like to call the number is 800-433-8850. We're discussing casinos in Maryland, raising both money and questions. You also can go to our website kojoshow.org, ask a question or make a comment there. I'm Kojo Nnamdi.

NNAMDIWelcome back. We're talking about casinos in Maryland, how they are raising questions even as they raise money. We're talking with Keith Whyte. He is executive director of the National Council on Problem Gambling. Jeff Barker is a reporter with the Baltimore Sun. And Annys Shin is reporter with the Washington Post. You join the conversation by calling 800-433-8850. You can send email to kojo@wamu.org. Have you visited the casinos in Maryland?

NNAMDIWhat do you like or what do you not like about having them nearby? 800-433-8850. Jeff, the Horseshoe has only been open for a few weeks, but it seems to be doing quite well. How are people feeling locally about it?

BARKERYou know, it is doing well. They got lucky because on the things that they're trying to do is they're trying to get a lot of revenue from sports fans. It's right -- walking distance from M&T Bank Stadium, where the Ravens play. Now, the Orioles are in the post-season. That's going to help them. They're going to have more Orioles games in Baltimore.

BARKERThey had a big college football game there. I think people are feeling good about it, but I think they -- that they knew in the beginning it's a novelty and a lot of people would come. So the question is does that sustain?

NNAMDIHere now is Susan, in Dumfries, Va. Susan, your turn.

SUSANOh, hi. Yes. I -- my family, we lived in Las Vegas. We've been in Virginia 20 years, but my husband was stationed out there. And I, you know, was totally immersed. We lived outside of Las Vegas in Henderson. But I was totally immersed. There were so many, you know, gambling things. And even our grocery stores, we had one-armed bandits. You know, it was always just stressing for me to be there with my children and see, you know, people with their groceries just playing and playing and playing.

SUSANAnd that was just a teeny bit. But the church I went to, you know, we had a gamblers' anonymous meeting at there -- at off hours and stuff. So living in Virginia in the last 20 years and being horrified that revenue was being touted as such a good thing to do and have casinos come in so we could spend money on education -- I just think it's a fool's thing.

SUSANIt's just not a good way to sustain incoming money because you're kind of going on the backs of people. Even if they don't have a really bad gambling problem, those that least can afford it are spending money that they can't afford on gambling. And it's very alluring because just of the nature of gambling. So I'm just horrified that that's the way…

NNAMDIKeith, if we've got casinos popping up every place, can one-armed bandits in grocery stores be far behind?

WHYTEWell, I…

SUSANWe will. Yes, we will.

WHYTEI do think, you know, when you see convenience gambling, what we're seeing already throughout D.C. are video lottery terminals, instant ticket vending machines. You can play Historical Horse Racing and some forms of Quasi Poker, all under this lottery law. You're seeing a lot of that in Virginia as well. In Maryland, the fraternals received the right to operate slot machines in the community. These are up to five machines per post, which are often locate right in the center of town.

WHYTESo I do think you're seeing a move more broadly towards, you know, there's the big destination casinos, but then there's a lot more convenience machine-style gambling, that's going to pop up in sweepstakes cafes.

NNAMDIOnce the foot is in the door, Annys, doesn't this almost necessarily mean that if there are revenues to be generated from gambling just about any place, that we could soon see -- or if not soon, in the future see legislation that allows gambling in all kinds of locations besides casinos.

SHINI mean it's possible. You know, what we -- the general trend that we've seen is when states start to lose ground -- on casino gambling, for instance -- they turn to legalizing other forms of gambling. So New Jersey did online gambling. They're talking about sports betting. You know, Delaware is doing…

WHYTEDelaware has online, as well.

SHINRight.

WHYTEPennsylvania just now -- they legalized small games of chance at taverns. And they assumed there was going to be thousands of bar owners that were going to apply for this licensing to be able to have poker and raffles and things. And I think at last count they had four. But, you know, because they had seen a decrease in gambling revenues, as you say, and so they were looking at other, you know, this -- for politicians, this is often a really easy thing to sell. I mean, and they see it as it's easy revenue, but it's not painless. And I think there's a distinction there.

NNAMDIHere now is Antonio, in Alexandria, Va. Antonio, you're on the air. Go ahead, please.

ANTONIOYeah, thanks for taking my call, Kojo. Yes. I live in Alexandria, Va. And my question is why does it have to be at National Harbor, coming up in two years, where we have the tremendous traffic problem, the worst in the nation, in the whole area here. Why there? Why can't they put it out in -- way out there somewhere? Twenty miles or something? Why does it have to be right at the Wilson Bridge, with more traffic, with thousands of cars -- more cars?

WHYTEThat's why.

SHINRight. That's where all the people are.

NNAMDII was about to say it's all about convenience. Yes.

SHINThey want to be in the population centers now. It's the -- not the destination mile any more. They want to be where the people are so they are going to be where all the traffic is, unfortunately.

NNAMDIExactly right. Antonio, they don't want to be too far out. They want to be -- to have them easily accessible so that people from neighborhoods nearby can take advantage of them or lose all their money.

ANTONIOWell, what plans do they have? Do they have some traffic plans then? So -- how's this going to work when...

NNAMDIAt National Harbor? Annys, traffic?

SHINI'm assuming they do.

NNAMDIYeah.

SHINI'm sure that was a huge concern.

NNAMDIYes.

SHINYou know, but National Harbor, especially, I mean, the funny thing about Baltimore is a lot of the people in line were saying how great it was. The people in line, who didn't get in, that they could just take the bus or, you know, the light rail there.

WHYTEThat's true. Public transport.

BARKERBut that -- in competition between Maryland Live and Horseshoe, though, that's, of course, Maryland Live's big advantage is that they have 13,000 spaces because they're at Arundel Mills. So parking, you know, parking is huge when you're at a casino. And so I wonder, you know, parking and traffic. So I know Baltimore's actually a little worried about traffic because they do have those stadiums I mentioned right there. So that's a concern.

WHYTEAnd I think MGM is funding, actual -- an offering, you know, from the, like, right into the casino. I mean, so -- but I don't know that Virginia…

NNAMDII was going to ask, Annys, what else can we expect that this new MGM resort coming to Prince George's County in 2016 -- it's going to be huge.

SHINIt's going to be huge. It's going to be bigger than Maryland Live or Horseshoe. So, you know, we like to have this horse race right now between Baltimore and Arundel Mills. But the big fish hasn't shown up yet. So…

WHYTEAnd Arundel Mills is already one of the biggest casinos, if not the biggest casino in the country already. And they will probably have to expand to keep up with MGM.

NNAMDIWe'll see how all of that turns out. In the meantime, we're interested in hearing from you. 800-433-8850. Here is Aaron, in Washington, D.C. Aaron, you're on the air. Go ahead, please.

ROGERMy name is not Aaron. You know, I changed my mind. You know, I don't want the casinos to know I called you, you know.

NNAMDIOkay, Aaron.

ROGERIt's not Aaron. This is Roger.

NNAMDIOkay, Roger. Go right ahead.

ROGEROkay. I was playing in Atlantic City for years. And I played also in Maryland Live when they had -- when they didn't have the human dealers, you know, blackjack. And the blackjack computer deals you some cards and I believe that several times the dealer got about five blackjack in a row, which never happened before in my life. I've never seen…

NNAMDISo you are suspicious, Roger?

ROGERI am. That's one thing.

NNAMDISo you want to know who is responsible?

ROGERSo who controls the…

NNAMDIWho is responsible for regulating and keeping these casinos, in Roger's view, honest? Jeff?

ROGERHonest, yeah.

BARKERWell, that -- no, that's something that I want to -- I'm fairly new to the beat. I want to learn more about the slots program. I want to learn more about how random it is and how that works. But I know when I joined the beat I went on Yelp and Trip Advisor and I read about what people were saying. And maybe they always say this, but I know people were saying about Maryland Live, it has a very low return rate. And maybe they -- maybe people always feel that way. I don't know. But this is something I need to educate myself on.

WHYTEWell, I think that was for a long time, when they were basically a monopoly. You know, they had fairly low rates. I think as competition arises, you will see their, you know, pay out percentages is very competitive in this market. In Las Vegas you see very, very high payout rates because there's -- there is the gamblers -- sophisticated gamblers will know. But the Maryland Gaming Agency I think has done an amazing job, both in regulation in general and on the responsible gaming as well. But in regulation, these machines are tested within an inch of their lives to insure that they're random.

WHYTEIt is a very sophisticated process. It's incredible to go into the chips and you see this, this randomness, these controls that they have. So I think the games are -- by and large, you're still going to lose. You're going to lose in a fair way.

NNAMDIOn to Ed, in Hanover, Md. Who, I think, wants to remind us that, in his view, there are other benefits to casinos. Ed, you're on the air. Go ahead, please.

EDThank you very much. Their success is promoting themselves. The menu is entertainment first. You can eat, you can see free shows and, by the way, with a wink of the eye, you could gamble. Also, you could walk right across and spend all your money -- if you win -- in the mall. If you lose, well, you get on the bus from Pennsylvania and you go back home. That's their success.

NNAMDIIs this something you enjoy, Ed?

EDI don't gamble. I do have -- gone to their buffet, which is a wonderful buffet, which is inexpensive. All you could eat. And you can enjoy yourself at the same time, you could just walk right across the road and go into the mall. And have a good time.

NNAMDISo you see this…

EDSpend plenty of money there.

NNAMDIYou see this as a general form of entertainment without having to gamble at all.

EDGambling -- no, gambling is -- they do gamble. People gamble. But, of course, that's secondary. They have to promote themselves as an entertainment arena. Gambling is part of it.

NNAMDIYes. They do promote themselves in that way, but I guess we all know that the primary purpose of their existence is gambling. Here now -- thank you for your call, Ed. Here now is Murad, in Baltimore, Md. Murad, you're on the air. Go ahead, please.

MURADGood afternoon to everyone. I'd like to revisit the question that was asked by a retired teacher. Now, how much of the gambling money, tax revenue, that goes into education was mentioned? Out of $850 million, $323 or so going to education.

NNAMDIRight.

MURADWhat I'd like to know is your panelist made a comment that this is in place of what we used to spend on education, not on the top of. What I'd like to know is was it more -- be specific to the amount -- now money -- $320 million is going to education -- or is it less before gambling?

NNAMDIHave any idea, Keith White? I think the complicated formula for this money has to do with not only the money that comes in from gambling, but it also has to do with a budget process that I'm not sure everyone quite understands here.

WHYTEAbsolutely. And I am certainly no expert on that. All I can say is that historically the studies are fairly clear that states with lotteries tend to spend less on average than states without. And so extrapolating that to gaming, you now, to casinos, I think, is fairly safe. But, again, yeah, it's entirely driven by the political budget process. It has very little do with the source of funds, whether that's lottery or casino or some other tax. It has a lot more to do with the budgetary and political imperatives.

WHYTEBut this money, again, this money is often -- it's not being switched necessarily, but it is fungible. And it often gets moved into different accounts because people assume that when you have gaming -- and especially when it's expanded specifically to fund education -- that that is new money and that it's going to be an increase. And in -- and over time -- the record is clear -- it generally tends not to be as much of an increase as it would if your state did not have that...

NNAMDIHere's Joe, in St. Michaels, Md. Joe, you're on the air. Go ahead, please.

JOEThank you for having Mr. Nnamdi. I enjoy your show.

NNAMDIThank you.

JOEI'd like to offer this opportunity to be sort of devil's advocate. I do not gamble. Not -- never been particularly interested in it. However, I lived on the Gulf Coast of Mississippi before, during and after Hurricane Katrina. And if communities like Gulfport, Biloxi and so forth did not have the gambling institutions they have down there, that area would still be a war zone. The casinos kept their employees, even when they had no facilities to work at. They provided money for the community to clean up.

JOEThey provided facilities for people to eat and sleep and so forth. And we have to remember that these industries, if in the right place, can really, really, really be of great benefit. When Hurricane Katrina…

NNAMDISo are you now wishing a hurricane on us?

JOEWell, I tell you what, after living through Katrina, I can tell you that there was something up. And I didn't gamble, but like the gentleman before said, I enjoyed going to see the shows. I enjoyed going to the restaurants and so forth. But the casinos down there in Biloxi and Gulfport -- and let's keep in mind, that Katrina did not hit New Orleans. Okay. Katrina when through Bay St. Louis, Miss. That's where the eye of the storm came through. Gulfport and Biloxi were nearly completely destroyed.

NNAMDIAnd you feel that the casinos were essential to the recovery of that part of the country.

JOEThe casinos were essential because when Hurricane Camille came through in…

NNAMDIWell, we're just about out of time. But I think your point, Joe, is well taken, that in that situation the casinos were able to help. We'll simply have to see how things turned out -- how things turn out in Maryland. Annys Shin is a reporter for the Washington Post. Annys, thank you for joining us.

SHINThanks for having me.

NNAMDIJeff Barker is with the Baltimore Sun. Jeff, thank you for joining us.

BARKERThanks, Kojo.

NNAMDIAnd Keith White is executive director of the National Council on Problem Gambling. Keith, thank you for joining us.

WHYTEThank you, Kojo.

NNAMDIThank you all for listening. I'm Kojo Nnamdi.