The Maryland Senate Budget and Taxation Committee heard testimony on SB 267, which would allow a voter referendum in November 2024 on legalized online gambling.
Sponsored by state Senator Ron Watson and Senate Majority Leader Nancy J. King, the bill would direct online gambling funds to the Blueprint for Maryland’s Future fund, which focuses on education reform.
Watson is a member of the legislative black caucus, which observers said was the reason representatives of minority-owned gaming businesses supported the bill.
Watson said, “We are missing one vital component with respect to gaming and that’s the fourth leg of the casino tool, which is internet gaming. The fundamental aspect of this bill, it creates a new funding stream for education, and I have deep concerns that we need to do what we can to support our Blueprint.” Watson added the state comptroller’s office estimated internet gambling could add up to $97 million to the fund by fiscal year 2028.
Under the bill, 5-year online gaming licenses would cost $500,000. Licensed companies could keep 85 percent of profits, with 15 percent going to the education fund, a 10-year plan for public education the legislature passed in 2021. Governor Wes Moore’s office said the state budget includes enough funds to sustain the Blueprint through fiscal year 2026, when the projected revenue from SB 0267 would kick in.
Opponents of online gambling noted Marylanders have lost $23 billion on government-run commercialized gambling since casinos first opened in the state in 2010. Les Bernal, national director of Stop Predatory Gambling & Campaign for Gambling-Free Kids, said, “The American Psychiatric Association now defines gambling addiction at the same level as heroin, opioids and cocaine. We do not market those products like the state government markets gambling. Online gambling is like gambling fentanyl, it’s like the most extreme form of all. It’s opening the casino right in your bedroom so you can sit there in your pajamas and lose everything.”
Another issue concerns including black and minority-owned businesses in gambling expansion. Alyse Cohen, owner of Long Shot’s OTB and Sportsbook, said the four Maryland OTBs are a coalition of women and minority-owned businesses.
Cohen added that as one of the most diverse states in the country, Maryland has looked to prioritize underserved communities in the past. “iGaming should be no different. By giving only the casinos the ability to expand their online presence, any true equity inclusion for women and minorities is lost,” she said.
DraftKings lobbyist Frank Boston III also asked the committee to allow participation by non-casino gaming stakeholders. Boston said, “When the licensing opportunity is limited to just the state’s casinos, it drastically limits competition and further limits the state’s ability to realize the most revenue possible. As such, DraftKings asks this committee to please consider expanding market access provisions within the bill to give opportunity for the state’s non-casino gaming stakeholders.”
Following the committee meeting, Watson said, “My initial conversations showed minorities have never really played in this space and there are very few minority companies that actually have the $15 million to $20 million backend to play banker. We saw that in several cases when it came to sports betting. But I would like to have that conversation with you. I would like, if possible, to build in some kind of either equity component or ability to engage and attract MBEs so that we can spread the wealth, if you will.”
State Senator J.B. Jennings expressed concern about where the revenue for education actually would come from. He said between Thanksgiving and Christmas he heard FanDuel commercials. “When you say these numbers about how much we’re giving to the education trust fund, that’s great until you really think about what that number is. That’s somebody who’s gambling that lost what’s going into that fund, so that means that’s less money in that person’s pocket.”
State Senator Craig Zucker also inquired why the bill doesn’t include money for problem gambling services. Watson responded, “I’m more than happy to work with the committee to work out those details and make sure we’re doing what we need to do for people who have those issues.”
A spokesman for the Maryland Gaming & Lottery Commission said, “The Senate Budget and Taxation Committee held an initial hearing on Senate Bill 267 and decided to form a work group to discuss it further. We will be following the work group’s discussions and any decisions that the General Assembly makes.”
Lawmakers will consider other gaming issues this session, including adjusting the numbers of machines that bingo parlors may operate and a allowing senior centers in St. Mary’s County to host gaming.
