MD General Assembly working on bill to enable sports betting

Legislation that would facilitate sports betting operations in Maryland has been introduced in the House of Representatives and has been the subject of multiple hearings and workshops since mid-February.

Maryland voters in November 2020 approved sports betting via constitutional amendment. During the shortened 2020 General Assembly session, both houses held hearings on sports betting bills but opted to proceed with a simplified ballot question and work on enacting legislation in 2021.

The measure, which includes mobile wagering on sports, has been taken up by the House Ways and Means Committee. A sports betting bill had not been filed in the Senate as of March 1, but that chamber’s Budget and Taxation Committee thus far has held two sports betting workshop to get input on legislation.

Here are some of the parameters of the House bill:

Class A licenses issued by the Sports Wagering Application Review Commission would go to most racing associations and all video lottery terminal operators—the six casinos in the state. The eligible racetracks are Laurel Park, Pimlico Race Course and the Maryland State Fair at Timonium. Casino at Ocean Downs, which has live racing, qualifies as a VLT operator. The bill’s language precludes Rosecroft Raceway from sports betting.

There would be five Class B licenses issued by the commission. Class A licensees would not be eligible, nor would a facility located within a 10-mile radius of a Class A licensee or Class B licensee.

The commission can authorize up to 10 mobile sports wagering licenses, all which would be up for bid. Class A and Class B licensees would be eligible to bid for a mobile sports wagering license.

The initial application fee for a Class A licensee is $250,000, $50,000 for a Class B licensee and $500,000 for a mobile wagering licensee. Annual renewal fees are $50,000 for Class A, $10,000 for Class B and $100,000 for mobile. The term for a sports wagering license is five years.

The state tax rate for Class A and Class B licensees would be 15% of the proceeds from sports betting. Mobile wagering licensees would pay 15% of the first $5 million in proceeds and 17.5% for any proceeds exceeding $5 million. The state’s share would be dedicated to education via the “Blueprint for Maryland’s Future Fund.”

During the first Senate committee workshop, lawmakers reviewed their legislation from early 2020 which put the Maryland Lottery in charge of awarding sports betting licenses; would give all casino VLT operators, certain racetracks, and non-casino off-track betting facilities licenses; casinos and tracks would be able to conduct mobile wagering under their licenses; and charge an initial $2.5 million license fee ($1.5 million for the Maryland State Fair at Timonium and any VLT operation with less than 1,000 machines) and 25% annual renewal fees. The state tax would be 20% for VLT casinos and tracks and 25% for OTBs, which would contract for licenses through the track operator.

During a March 1 meeting of the House Ways and Means Committee’s Racing and Gaming Subcommittee on House Bill 940, some lawmakers expressed concern that bricks-and-mortar facilities would not be awarded “skins,” or mobile licenses, as part of their primary license. There were also questions about the relatively low number of Class B licenses, all of which would be up for bid, as well as why Pimlico could only offer sports betting during its short live race meets. It was also noted that Fair Hill, which recently renovated its one-mile turf course and was approved for eight racing days—steeplechase and flat—for 2021, doesn’t qualify for a Class A sports betting license under the House bill language but could bid for a Class B license. 

In other legislative matters, a bill that expands the Maryland-Bred Race Fund Advisory Committee from five members to six with the addition of a seat for a Maryland Thoroughbred Horsemen’s Association representative and also modifies statutory language related to Maryland-bred eligibility was approved Feb. 25 by the House by a vote of 135-0 and now moves to the Senate, where a companion bill had been filed. The other five seats on the advisory committee are for the Maryland Horse Breeders Association (two seats), one recommended by the Maryland Jockey Club, one from the Maryland State Fair and one appointed by the Maryland Racing Commission. 

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