MD Sports Betting Bill Includes Racetracks, Purse Accounts

Legislation authorizing a study of sports betting, licenses for which would be available to racetrack and casino operators, had its first hearing March 1 before the House Ways and Means Committee.

The bill, sponsored by Republican Delegates Jason Buckel and Kevin Hornberger, was introduced Feb. 8. It would create a task force to study sports betting but also says implementation would hinge upon approval via a statewide constitutional amendment and changes in law on the federal level.

Sports betting in the United States is legal in Delaware, Montana, Nevada and Oregon, and to varying degrees. Any expansion of gambling in Maryland requires a constitutional vote.

“The purpose of the bill is very simple,” Buckel said during the hearing. “Other states recognize that sports betting is happening. If and when federal law allows us to have sports gaming, we had better be on top of how we want to do it, tax it, and regulate it.”

The bill notes that sports betting can only be offered by “repeal or amendment of the federal Professional and Amateur Sports Protection Act in a manner that does not prohibit the state from allowing wagering on sporting events or a determination by a federal court or the United States Department of Justice that (PASPA) does not prohibit the state from allowing wagering on sporting events.”

Buckel noted other states, most recently neighboring West Virginia, have introduced similar legislation, and a bill is pending in Pennsylvania. The United States Supreme Court has sent a challenge to federal law by New Jersey, where the legislature has authorized sports betting, to the U.S. Solicitor General for an opinion.

Though the Maryland measure is simply a starting point, it does outline how revenue would be allocated, and horse racing would be a beneficiary. The holder of a sports gaming license would retain 80% of money bet, and the remaining 20% would be divvied up as follows: 65% for the Maryland Education Trust Fund, 20% for local impact grants, 5% for the Purse Dedication Fund, 5% for the Transportation Trust Fund, and 5% for the Problem Gambling Fund.

Purses and breed development currently receive 6% of revenue from video lottery terminals at five casinos and 2.5% from a sixth in western Maryland.

The holder of a sports gaming license could take bets on sporting events from an individual—the minimum age would be 21—physically present at a VLT facility or a racetrack that offers Thoroughbred or Standardbred racing, according to the bill.

The task force would be compromised of three Senate members appointed by the Senate President; three House of Delegates members appointed by the Speaker of the House; the director of the Maryland Lottery and Gaming Control Agency; a representative of the VLT casinos appointed by the governor; and a representative of the horseracing industry appointed by the governor. The task force would be charged with monitoring action on federal laws; studying implementation of sports betting in other states; and making recommendations on changes needed to facilitate sports betting in Maryland.

The provisions for division of revenue serve as guidelines for the task force, which could make its own recommendations.

Hornberger said the bill he co-sponsored with Buckel is a “forward-thinking and practical approach for what we think is not a matter of if but when” sports betting is legalized in the U.S. He said the idea is to have a framework in place so Maryland “could turn it around quickly rather than wait three or four years.”

Buckel noted sports betting limited to parlay plays on professional football games generated $40 million in revenue in Delaware in fiscal 2015. It’s expected a much broader program in Maryland would generate far more revenue.

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