Maryland lawmakers last week introduced a bill that would authorize sports betting to be conducted under the management of the state lottery. If passed, the bill could create sports books for Maryland casinos without the need of a constitutional amendment.
Maryland legislators failed to pass a bill last year that would have placed sports betting on the November statewide ballot to pass a constitutional amendment, which is the manner in which casinos were approved in 2008. The failure means lawmakers’ next chance at passing a constitutional amendment would be the November 2020 election, meaning sports books would wait until at least 2021 before bringing revenue to the state.
The bill introduced last week by Dels. Jason Buckel and Kevin Hornberger would authorize the Maryland Lottery to conduct sports betting. The state constitution authorizes the issue sports betting licenses to racetracks and video lottery operators—the six casinos—and direct 80 percent of revenue to the lottery, with casinos getting the remaining 20 percent.
According to an article in Legal Sports Report, initial stories had those numbers transposed, which would have meant a 20 percent tax on sports book revenues—comparatively high, but still reasonable when compared to Pennsylvania’s 36 percent rate. However, lawmakers Maryland, known for some of the highest gaming taxes in the nation, are in the process of amending the bill to reflect that most of the money will go to the lottery itself.
Under the bill, racetracks and casinos would pay a $300,000 license fee to operate sports betting, with an annual renewal fee of $50,000. Eighty percent of those fees would go to the lottery’s Education Trust Fund, with 10 percent of the remainder to local impact grants and 10 percent to a problem gambling fund.
The lottery is free to add games under a statewide referendum that was approved in 1972. “If we can find a way to do it without a referendum, I’m certainly amenable to move forward this year,” state Senate President Thomas V. Mike Miller said last month.
The bill would take effect July 1, after which operators would need to contract with sports-book suppliers. The process would allow sports betting to launch next year—at least a year earlier than under the constitutional amendment process.
What remains to be seen is if any licensees will be willing to operate books for 20 percent of the proceeds.
