In a March 4 hearing before the Maryland House of Representatives, four casinos in the state expressed support for legal online casinos. Two others said they think iGaming will cannibalize land-based operations. Later testimony before Senate members showed the same division.
According to PlayMaryland.com, those in favor include MGM National Harbor, Horseshoe Baltimore, Hollywood Casino Perryville, and Rocky Gap Casino in Cumberland. The Live! Casino in Hanover and Ocean Downs in Ocean City are opposed.
MGM Resorts Senior Vice President of Government Affairs Rick Limardo said an online industry would be “an incredible opportunity for Maryland” and a natural extension of brick-and-mortar operations.
“We have over $1 billion invested in Maryland,” Limardo said, “and would not jeopardize that investment if we thought iGaming would compete with or negatively impact our business.
“Based on our experience, there are synergies between our retail casinos and iGaming that have allowed us to enhance the customer experience and build business with both.” He added that iGaming “gives casinos a new way to engage with their customers and introduces a new demographic to land-based gaming, which is why we support a framework that tethers iGaming licenses to casino operators.”
Randy Conroy, general manager at Horseshoe Baltimore, which is owned by Caesars Entertainment, said he supports iGaming, provided licenses are linked to the state’s six existing casinos. But he balked at a proposed 55 percent tax rate. Conroy called for “a reasonable” tax rate of 15 percent.
“You should demand the best iGaming experience in the country, which will require significant technological investments by the operators,” said Conroy. “iGaming is a fast-changing landscape with a different expense structure than traditional casinos. At a reasonable tax rate, iGaming will be demonstrably a better experience.”
Hollywood Casino Perryville spokeswoman Caitlin McDonough agreed with Limardo and Conroy that online casinos should be tethered to existing retail operations. Under that scenario, she said, “We do support iGaming … and believe it can be implemented in a fair and equitable way that will benefit both the state and our gaming industry.”
Hollywood Casino Perryville is owned by Gaming and Leisure Properties, a spinoff of Penn Entertainment.
Jonathan Carpenter of Greenwill Consulting spoke for the Rocky Gap Casino, owned by Century Casinos, and suggested a rate of “maybe 28 percent.”
Meanwhile, Mark Stewart, who spoke on behalf of Live! Casino, said job losses will be greatest among “those with a high school diploma or less.”
Rob Garagiola, who also represented Live!, asked members of the committee a simple question. “How many businesses have closed due to online shopping?”
Delegate Vanessa Atteberry, sponsor of House Bill 1319, has proposed a $1 million licensing fee with a term of five years and a 55 percent tax rate for operators unless they offer live-dealer games. Those who do would be subject to a 20 percent tax.
According to PlayUSA.com, the House Ways and Means Committee voted for an amended version of the bill, which would open the door to up to 30 casino licenses (up from a dozen) and also includes conditions “to make licensees more diverse, equitable and inclusive.” The amendment also prohibits the use of credit cards to fund online accounts and added language to help mitigate problem gambling.
Senate Bill 603 would give each of the six casinos two skins each, for a total of 12 licenses, and does not ban the use of credit cards.
The issue may go to Maryland voters in the November general election. But according to the Baltimore Sun, a General Assembly leader said it’s unlikely the legislation will pass in 2024. An opinion piece in the Sun, contributed by Baltimore County Delegate Ryan Nawrocki and Anne Arundel County Delegate Nic Kipke was four-square against the plan.
They wrote: “Ask yourself this simple question: With almost 40 states having authorized sports betting today, why have only seven states approved casino gambling on phones even though it has been around for over a decade? The answer is simple: 43 states have concluded that iGaming is a lose-lose scenario” that will “harm taxes collected by the state.”
They cited a recent study from the Maryland Lottery that they say “showed an expected 10 percent loss in gaming revenue from Maryland’s six casinos if iGaming is introduced,” as well as “thousands” of job losses.
Moreover, they wrote, a Morgan State University study concluded that, “In light of the data from various states, Maryland is advised to carefully weigh the promised economic benefits of iGaming against the potential for increased problem gambling.”
