Maryland Legislature approves sports betting bill with a high cap on licenses

On the final day of the 2021 session, the Maryland legislature approved legislation to legalize sports betting, voting overwhelmingly in favor of a bill that Gov. Lawrence J. Hogan Jr. said he likely will sign.

The House of Delegates approved the final measure 122-16 on Monday evening, a few hours after the state Senate did the same with a 47-0 vote.

The state’s share of the proceeds will be used largely to supplement the Blueprint for Maryland’s Future Fund, a K-12 education account.

Del. Anne R. Kaiser (D-Montgomery), chairwoman of the House Ways & Means Committee, said that if emergency regulations are adopted in time, Maryland residents will be able to place bets on professional and college sporting events by late summer. “I think the goal is to go live by kickoff of the NFL [season] in the first week in September,” she said during floor debate Monday, as reported by Maryland Matters.

Discussions about how to implement sports betting meandered during much of the session, intensifying only in the legislature’s final days as legislators sought to resolve differing approaches. Lawmakers differed primarily on whether to cap the number of licenses or leave it to the free market.

Under the deal, Maryland will award as many as 60 licenses to companies wishing to offer mobile, or app-based, betting. As many as 47 additional licenses will be issued to “bricks and mortar” applicants — 17 identified in the bill and 30 others that will be awarded through an open application process.

Among those guaranteed an on-site license if they want one are Maryland’s six casinos, teams that play in the state’s three professional football and baseball stadiums, the Maryland Jockey Club (for use at Laurel Park and Pimlico race tracks), the Maryland State Fairgrounds, four off-track betting locations, and the state’s two largest bingo halls.

Gov. Hogan on Monday said lawmakers “seem to have worked a pretty good agreement to make most stakeholders somewhat acceptable to the bill. I can’t really say exactly without reading it, but I’m pretty sure we’ll be able to act on that one pretty quickly.”

Firms that want to run a sportsbook will pay an up-front fee. In the case of the state’s big casinos, it will be hefty — $2 million for a license that will last five years. Smaller enterprises will pay much less. In addition, sportsbooks will pay a 15% tax on the money that’s left after they pay off winning wagers. Based on the experiences of other states, Maryland expects to reap approximately $18 million in revenue each year.

Lawmakers stressed throughout the session that they expect the newly-created Sports Wagering Application Review Commission to boost applications from minority- and women-owned businesses to the maximum extent possible.

“The voters spoke and the Maryland General Assembly delivered,” said Sen. Craig J. Zucker (D-Montgomery), who headed a Senate workgroup on sports wagering. “Sports betting will soon be up and operational in Maryland as early as the Fall. Money from this will fund education all while providing opportunities for small, minority owned, and women owned businesses to participate in the market.”

The bill now goes to Hogan’s desk and could be signed into law as early as this week. The Maryland Gaming Commission will oversee a committee that will select and licenses all retail and online sportsbook licenses with certain priority for minority and women-owned businesses. This process has taken between three to 18 months in other states, but stakeholders are confident Maryland will be on the quicker end of that spectrum.