Maryland Sports Betting Licenses Lagging On Approval

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Only five of 17 businesses guaranteed an in-person Maryland sports betting license under a 2021 Maryland law are taking wagers, nearly nine months after the law was enacted.  Several of those 17 businesses have yet to apply, state regulators say. 

Five of the 17 businesses “have not submitted anything as of yet,” Maryland Lottery and Gaming Control Agency (MLGCA) official Jim Nielsen told the Sports Wagering Application Review Commission (SWARC) at its meeting today. Four others, said Nielsen, have submitted applications but have not yet been vetted by MLGCA or SWARC. 

Three OTBs among the 17, however, have been awarded licenses and are expected to open soon. Those include Long Shot’s in Frederick, Riverboat on the Potomac in Colonial Beach, Va. (PointsBet will operate the book), and Greenmount Station in Hampstead. 

SWARC member Laura Gamble, who is regional president of PNC for Greater Maryland, asked if there has been outreach to the five that have yet to submit applications. SWARC, through its legal team, has started reaching out to women and minority-owned businesses that may need assistance with the application process. Nielsen said there has been outreach from MLGCA as well, as inclusion of these businesses is an initiative in Maryland.

“Some of them are still trying to decide if they want to (do this),” Nielsen told SWARC. 

Possible Hold-Ups in Maryland Retail Licensing

MLGCA receives license applications from in-person sports betting facilities and investigates the applicants. It is allowed to issue the licenses after SWARC, an independent regulatory commission, awards them. SWARC is “required to award (the) 17 licenses to entities that are specified in (state law) if they apply,” says the MLGCA website

The 17 entities include casinos, professional sports stadiums, horse racing tracks, off-track betting facilities, and bingo halls with at least 200 electronic instant bingo machines. Five of the 17 – all large casinos – opened in December, grossing $49 million in sports betting handle in their first two months in operation. 

Those five casinos are MGM National Harbor (operated by BetMGM, opened Dec. 9); Live! Casino & Hotel (operated by FanDuel, opened Dec. 10); Horseshoe Casino (operated by Caesars, opened Dec. 10); Ocean Downs Casino (operated by TwinSpires, opened Dec. 17); and Hollywood Casino (operated by Penn National/Barstool, opened Dec. 23). 

SWARC Chair Tom Brandt noted today that the license fees might discourage some businesses from applying, even if they are virtually guaranteed a retail license under state law. 

The licensing fee under current law is $250,000 for major retailers and $50,000 for small retailers. Tax rates are 15 percent of gross gaming revenue (money won by sportsbooks) for major retailers and online sportsbooks, with smaller retailers taxed at 13 percent

“The license fees are pretty steep for some of these (businesses) so it’s not a trivial choice to buy into the game,” said Brandt. 

Aside from the 17 entities designated by law, up to 30 additional retail licenses and up to 60 mobile sportsbook licenses can awarded between now and early 2023, per state law. There is no definite timetable set by SWARC for awarding sports betting licenses – retail or mobile – in Maryland. 

Sportsbook Operator Agreements And Maryland Sports Betting

Another hold-up for licensing of Maryland businesses designated for in-person sports betting could be pending agreements with sportsbook operators. 

Each of the 17 venues is allowed to partner with an operator, with six operators licensed to date. It is uncertain where negotiations are currently between operators and some designated facilities that have yet to be awarded a license. Aside from the six, Nielsen told SWARC today that three applications for licensing have been submitted with the remainder yet to be brought before MLGCA. 

Only MLGCA approves licensing of sports betting operators, with no required approval by SWARC. 

“Facility and online operator partners do not go before the SWARC, so staff can issue the license after determining that the applicant meets technical and operational requirements specified in regulation and is ready to start conducting sports wagering,” says the MLGCA website. 

Brandt seemed encouraged by the state’s progress in both vetting and licensing of “the 17”, as he called the designated businesses. “One of the unique aspects of our state of Maryland situation is its worthwhile monitoring,” he told SWARC members. 

Where Online Sports Betting Stands In Maryland, So Far

SWARC was also briefed today by its legal counsel from the Chicago-based Taft firm on a survey of nationally-launched sports betting operations. Taft attorney Kim Copp said the survey was sent to 49 sports betting industry groups across the U.S. to gauge how the relatively-new industry is doing as SWARC considers regulations for online sportsbook operators. 

Those regulations have yet to be approved. 

In addition to Washington, D.C., 29 states outside Nevada have launched sports betting since the U.S. Supreme Court in 2018 threw out a federal law prohibiting state regulation of sports betting outside of the Silver State. 

“I do believe we’ll get quite a bit of response back,” said Copp. “We will obviously take those responses, curate them, go through them, and of course, present them to this group so you can see what the industry input is, what suggestions are, and obviously utilize the answers then to craft what our rules and regulations would be for the application.” 

About the Author

Rebecca Hanchett

Writer and Contributor
Rebecca Hanchett is a political writer based in Kentucky's Bluegrass region who covers legislative developments at Gaming Today. She worked as a public affairs specialist for 23 years at the Kentucky State Capitol. A University of Kentucky grad, she has been known to watch UK basketball from time to time.

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