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County begins to feel heat from loss of casino share

(March 13, 2015) Senate Bill 57, also known as the Budget Reconciliation and Financing Act of 2015, proposes to take millions of dollars away from the counties, and at a time when it is anything but convenient.

Among numerous other adjustments, the measure would take more than $4 million out of local impact grants from casinos and place it into the state’s Education Trust Fund, not just this year, but next year as well.

It’s not that Worcester or other counties that get a slice of the gambling problems would get no money this year and next, but they will get less at a time when it and other governments are scrambling.

“It’s one thing to say we’re taking money away next year, but it’s really tough for them to say they’re taking it away this year,” county Assistant Treasurer Jennifer Swanton said this week.

The net reduction for Worcester, Ocean City, Berlin and Ocean Pines, all of which benefit from casino impact grants, would be roughly $295,000 this year and $285,000 next year.

That would still leave $2.3 million in 2015 and $2.5 million in 2016 to be distributed locally as impact grants, but Worcester had been planning on all, as opposed to some, of its share.

It gets 60 percent of the local impact grant, while Ocean City receives 20 percent and Berlin and Ocean Pines each receive 10 percent.

County Treasurer Phil Thompson said the money delivered from casino funds has a broad range of uses, as long as the county uses it for county residents. The county could not, for example, use its share of the casino money to repair a bridge in Pocomoke City or to pay the electric bill for Furnace Town.

But it can be used to pay down other expenses, as Worcester has been doing with the bond issue for the Worcester County Technical High School.

The county began that practice in fiscal year 2014, when the starting casino fund balance was almost $3.2 million. Revenue to the county for that year was $1.4 million and the payment amount for the school was $2 million.

Bond payments for the school are expected to hover around $2.5 million per year until it’s paid off in 2022. Meanwhile, should the SB 57 pass, the county would have to find close to $200,000 elsewhere to continue paying down the bond at the same rate.

The county commissioners have delivered a letter to Annapolis urging legislators to reconsider this option. Swanton said their reasoning is the money being withdrawn from the county by the state to help cover its commitment to education is already being used for education.

The measure had a hearing in the Senate on March 4 before the Budget and Taxation committee, but its status has not been updated since then on the official General Assembly website.

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