Bloomberg News

Maryland County Executive Sees MGM Cash Boost: Five Questions

January 23, 2014

Rushern Baker III has survived a random shotgun blast and toured India and Brazil to drum up business for Prince George’s County, Maryland.

Now, the 55-year-old county executive is betting a new casino will give a $41 million boost to the Washington suburb, home to Andrews Air Force Base and the U.S. Internal Revenue Service.

MGM Resorts International (MGM:US) won state approval in December to build the $925 million casino in the county, about 37 miles (59 kilometers) south of Baltimore. After it opens in 2016, the casino could be the most profitable for MGM outside of Las Vegas, Chief Executive Officer Jim Murren said after he got the go-ahead from a Maryland gaming commission.

For Baker, a Democrat, the project bringing 3,600 slots, 140 table games and a 300-suite hotel to National Harbor would expand the county’s economy. Government employers like the IRS and Andrews account for more than 25 percent of jobs, said Standard & Poor’s, which gives county debt its top AAA grade.

The government presence and institutions such as the University of Maryland-College Park “help stabilize employment and property tax bases,” the ratings company said.

Prince George’s plans to sell from $130 million to $140 million in bonds in May, said Thomas Himler, deputy chief administrative officer. Its general-fund budget is $2.7 billion.

Baker, who led a nonprofit focused on education after leaving the state legislature in 2002, is running for a second four-year term this year. The following is condensed from a recent phone interview:

Q: What will your county get from the new casino?

A: We’re going to get about $41 million in direct revenue. Indirectly, given the fact that nothing like it would be on the East Coast and that there’s an international clientele that comes to the Washington region, we think additionally we’ll get revenues from tourists and sales.

Q: What has the effect on the county been from the federal government shutdown last year? How would you minimize the risk next time?

A: People weren’t hiring or they were letting employees go because they weren’t sure how long the federal shutdown would last. One, we got together with the rest of the region and let our elected officials know on the federal level that this has a devastating impact on us.

Two, we got together with county executives from all over the country. The third thing is to do what we’ve been doing for the last three years, and that is how do we widen and diversify the number of businesses that are in the county so that we’re not relying on federal contracts or state contracts, that we’re bringing in commercial businesses like MGM?

Q: Maryland has started to pass along the cost of teachers’ pensions to counties, which for Prince George’s means an additional expense of $25 million this year. How is this affecting the county?

A: I didn’t want the pension shift to come down to the counties. I’ve said this to the general assembly: They have greater flexibility in raising revenues than we do at a county level. Having said that, the shift happened and it’s coming down to us. We’ve made the difficult decisions to make sure we can cover that.

Q: What is the county’s biggest fiscal challenge?

A: School construction. We have some very, very old schools in our county and in the neighborhoods where all the indicators are going in the wrong direction. Part of turning that around is not just public safety, but building quality schools and renovating those schools.

Q: In 2003, you were hit by stray buckshot by a random shooter while waiting at an ice cream shop in the county’s District Heights area. What message did that send to you? And did you get your ice cream?

A: I was at this ice cream place with the state’s attorney at the time, Glenn Ivey, one of my really close friends. We were standing there, a car pulled up at the stop light and just shot us in broad daylight. Glenn was shot in the arm; I was shot in the leg.

The message to me was that clearly the county was going in the wrong direction. If someone felt comfortable enough to come up to a popular ice cream place where there were children and just randomly shoot buckshot, to me it said, we have to do something about this. It made me more determined than ever to be county executive, quite honestly.

We actually got our ice cream and then we left. It was a chocolate custard. And it was a large one.

Please click here to suggest a public official you would like to see in Five Questions.

To contact the reporter on this story: Romy Varghese in Philadelphia at rvarghese8@bloomberg.net

To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net


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Companies Mentioned

  • MGM
    (MGM Resorts International)
    • $23.83 USD
    • -0.64
    • -2.69%
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