Maryland Legislators Forward Sports Gambling Initiative to the Governor
Revamped Take on Sports Betting Developments in Maryland, Virginia, Colorado, and Arkansas
In these peculiar times, the Maryland General Assembly shook things up, mirroring the unusual circumstances. A sudden change of pace saw lawmakers swiftly amending a sports betting bill, passing it through both chambers before their early adjournment on Wednesday. The bill, referred to as SB 4, now awaits Governor Larry Hogan's signature.
SB 4 calls for a public vote, allowing Marylanders to decide the fate of sports betting legalization. The bill - which garnered a 129-3 vote in the House and a 45-0 vote in the Senate - features referendum language, minorities business provisions, regulatory authority for the Maryland Lottery and Gaming Commission, education revenue allocation, and a study.
However, key sections, such as the proposed 20% tax rate on gross gaming revenue, $1.5-$2.5 million application fees, and the location of physical sportsbooks, including the possibility of allowing the Washington Redskins to operate a sportsbook at their Landover, Md. field, were stripped out. Notably, Virginia lawmakers have included provisions allowing the Redskins to offer sports betting within their state.
With the Maryland General Assembly in a rush to get sports betting on the November ballot, it seems they aim to modernize the casino industry, which has undoubtedly been impacted by the ongoing coronavirus pandemic.
The referendum question will read:
Are you in favor of expanding commercial gaming in the State of Maryland to authorize sports and event betting for the primary purpose of generating revenue for education?
Only two states, Colorado and Arkansas, have previously approved sports betting via a referendum. Colorado, in part due to questionable language suggesting a new tax, saw a narrow vote last November. Here's the question that Colorado voters faced:
Should state taxes be increased by $29 million annually to fund state water projects and commitments, and to cover sports betting regulation through licensed casinos, by imposing a 10% tax on sports betting profits, and taxes on operators?
Colorado operators are slated to launch sports betting by May 1, as per the new law. Arkansas, on the other hand, approved sports betting at four casinos in November 2018, with a 54.1%-45.9% vote in favor.
As of 2020, Maryland's General Assembly is the third state legislative body to approve sports betting, following Washington (focusing on tribal-only sports betting) and Virginia.
Insights:
As of now, Maryland's sports betting market is anticipated to launch in November 2022, following a voter-approved referendum in 2020.
Initial tax projections suggest a 20% rate; however, there have been proposals to increase it to 30%.
Colorado, Arkansas, Virginia, and Maryland have each pursued different strategies to balance revenue generation with market growth, through varying legalization processes and tax rates.
Virginia imposes a 15% tax on sports betting revenue, contrasting Maryland's currently proposed 20% rate, Colorado's 10%, and Arkansas' 13%.
In the light of Maryland's upcoming vote on sports betting legalization, the sports-betting industry could potentially expand, similar to what happened in Colorado and Arkansas. The passage of SB 4 in Maryland will set the stage for sports betting, allowing for sports betting developments in conjunction with sports events.
