Maryland might need some lawyers to sort this one out

New Maryland Sports Betting Bill Could Become Cash Cow For State Lottery

Maryland sports betting

This story has been updated.

Maryland sports betting could prove profitable for the state lottery under a bill introduced late last week.

Still outstanding, however, is the question of whether Maryland voters would need to approve legal sports betting.

The bill dropped by Dels. Jason Buckel and Kevin Hornberger would authorize the Maryland Lottery to conduct sports betting. Under the lottery’s oversight, state horse racing licensees and video lottery (VLT) operators could apply for a sports betting license.

A first draft of the bill directed 80 percent of sports betting revenue to the lottery, with licensees receiving a 20 percent share. An email sent Monday by Del. Buckel’s office to Legal Sports Report indicates that revenue split is a mistake:

One thing I wanted to correct is that the revenue share is 20% to the state and 80% to the license holder.  There was a typo when the bill was being drafted.  Those percentages were transposed, and we are in the amendment process to get the language corrected.

Maryland sports betting could need referendum

Whether this new Maryland sports wagering bill could take effect remains an open legal question. Voters approved in 2007 a measure requiring any commercial gambling expansion to go on the ballot.

The state lottery does not fall under that requirement, though. A voter-backed referendum from 1972 could allow lawmakers to bypass the ballot in favor of the lottery.

“If we can find a way to do it without referendum, I’m certainly amenable to move forward this year,” Senate President Thomas V. Mike Miller said last month.

Maryland tried and failed to pass a sports betting bill in last year’s legislative session.

What’s in the MD sports betting bill?

The three-page bill does not dive too far into details on an MD sports wagering operation.

State-approved VLT operators and horse racing operations could apply for a $300,000 license to offer sports betting. That license would last for one year before requiring renewal at an annual $50,000 cost.

The license fee distribution would break down as follows:

  • 80 percent to education trust fund
  • 10 percent to problem gambling fund
  • 10 percent to local impact grants

The bill does not restrict betting on any particular sports events or teams.

Lottery could hold the winning ticket

The state lottery would make its money from sports wagering profits. Keeping 20 percent of gross sports betting revenue is not as rich as some other states though.

By comparison to states with lottery-run sports betting operations, Rhode Island keeps 51 percent of sports betting revenue and Delaware holds 50 percent. Both states allow some casinos to operate sportsbooks.

Roughly 4,500 retailers offer lottery games in Maryland. Lottery director George Medenica said last month his agency tracks the industry and could operate MD sports betting.

By going through the lottery, casinos like MGM National Harbor and off-track betting shops would lose out. They could present political opposition to this bill, which would make an end run around the 2007 referendum.

Start date likely a ways off

Even if this bill proves legally viable, don’t expect to place your bets in Maryland anytime soon. The bill would take effect July 1, but the lottery would need to contract with a sports wagering provider.

The state also would need rules and regulations governing Maryland sports betting. Medenica said a 2020 launch appears most likely for the state.

Maryland will face competition from its neighbors as well. Washington, D.C. already legalized sports betting and could start later this year.

Virginia‘s state Senate recently passed a larger casino measure that includes sports betting. It remains unlikely to be enacted, according to Legal Sports Report sources.

Adam Candee
- Adam Candee is the managing editor of Legal Sports Report. He covers sports business and news from Las Vegas. Adam is a former editor and reporter at the Las Vegas Sun, Arizona Daily Sun and KLAS-TV. He can be reached at [email protected]