A Maryland Senate committee heard a familiar debate concerning online casino legalization on Wednesday, though the hearing ended without a vote on multiple gaming bills.
Sen. Ron Watson was joined by multiple gaming proponents at a Senate Budget & Taxation hearing to support his SB 885, which would allow anyone with a retail casino license or mobile sports betting license to obtain an online casino license. Maryland also has multiple electronic bingo halls which would be allowed to offer online bingo, but not full online casinos.
The online casino bill included the most back-and-forth testimony, but there were other gaming bills discussed Wednesday as well. The committee heard testimony concerning banning sweepstakes casinos, legalizing lottery couriers and a problem gambling study.
Maryland does not have a ton of time to wait before taking action on these bills. The Maryland Legislature’s crossover day is March 23 with the session adjourning for the year on April 13.
Most operators support online casino
The gaming industry sent out some of its top voices to speak in support of legalizing online casinos. That included testimony from MGM National Harbor and Caesars Horseshoe Baltimore, two of the highest grossing casinos in the state, and live-dealer supplier Evolution Gaming which says it would add around 700 new jobs through its live iGaming studios.
John Pappas, state advocacy director for online gaming trade group iDevelopment and Economic Association, noted this is his fourth year in a row discussing online casinos in the Maryland legislature and said the opportunity becomes “much clearer” every year.
Nearby states with online casino, including Delaware, New Jersey and Pennsylvania, continue to break gaming records thanks to online casinos, Pappas explained.
After Pappas was Joe Maloney, the CEO of the Sports Betting Alliance which represents bet365, BetMGM, DraftKings, Fanatics and FanDuel. He praised the committee for hearing out the ban on sweepstakes casinos but explained that is not enough to end illegal online gambling in Maryland.
“While we must ban these sites and enforce the law against them, doing so alone will not make them go away,” Maloney said. “Please understand that we must meet this challenge with a durable and sustainable legal, regulated market for online casino gaming, which in the end is the most powerful disinfectant to the scourge of these companies targeting our state.”
Youth council supports online casinos
Also joining most of the gaming industry in support of SB 885 was Cameron Askew, the legislative director of the Maryland Youth Advisory Council.
He noted the Blueprint for Maryland’s Future Fund, a program designed to improve the public education system in the state, is facing insolvency issues as soon as fiscal 2028. This would provide an estimated $265 million through fiscal 2031, Askew said.
“As the state faces more difficult budget decisions every session, I think we have to start considering long-term revenue streams that protect public education,” Askew said. “Through this additional funding source Senate Bill 885 ensures that the state’s commitment to the Blueprint and other education obligations does not increasingly obligate general funds to cover projected deficits.”
Casinos, union lead opposition
Not every casino operator is on board with launching online casinos in the state.
Mark Stewart of the Cordish Companies talked about how addictive online casino gambling can be, adding that the SBA has previously said they want customers in their gambling apps 10 times or more daily. There is no evidence that existing safeguards can help protect online gamblers, he added.
Pappas preempted Stewart’s statements in his own comments to point out that Cordish itself offers an online casino product in Pennsylvania. The company made $83 million in associated revenue over the trailing 12 months, Pappas added.
Ocean Downs GM Bobbi Jones also spoke against the bill. The casino is owned by Churchill Downs, which saw a 15% drop in revenue and a 40% reduction in jobs at its Presque Isle casino in Pennsylvania that it attributes to online gaming.
Ken Maxfield represented UNITE HERE Local 7, the local arm of a union for hospitality workers in casinos across the country. Those jobs, including bartenders and housekeepers, are at risk as they are totally reliant on in-person casino revenue, he said.
MD already has problem gambling issues
Launching online casinos in Maryland would exacerbate the problem gambling issues that already exist in the state, according to Jessica Welman, representing the Campaign for Fairer Gambling.
Maryland’s statewide problem gambling rate is already at 5.7%, which is near what online casino states New Jersey and Pennsylvania report at around 6%, or three times the national average, Welman explained.
“If you legalize online casinos, you’re all but guaranteeing that Maryland will have the highest problem gambling rate in the nation,” Welman added.
Multiple representatives from the Maryland Center of Excellence on Problem Gambling as well as those with gambling addiction problems also opposed the bill. Not only have requests for help increased but so too have requests for high school presentations about problem gambling, its Director of Operations Heather Eshleman said.
Michael Calamino described himself as a “severe gambling addict in recovery,” who credited the Maryland Center of Excellence on Problem Gambling with helping him not place a bet for nearly a year.
“As a gambling addict, I can state with conviction that an increase in accessibility and convenience in ways to gamble is like pouring gasoline on a fire,” Calamino said.
Virginia casino the real cannibalization concern
One of the most common arguments against online casinos is that they cannibalize revenue from retail casinos.
Watson said the consensus is that iGaming adds revenue to an existing retail casino market as it is complementary and distinctly different product.
He then pivoted to a bill in Virginia that would allow voters to approve a new casino in Fairfax, which sits just to the west of Washington, D.C. Watson noted the bill’s sponsor mentioned they are sick of seeing Virginia dollars flow out of state to Maryland.
“One-third to two-fifths of MGM’s revenue comes from Virginia,” Watson explained. “That’s approximately $300 million of direct impact. That is what cannibalization really, really is. That is what Virginia is set to do to us.”
Online casino legislation details
Watson’s bill would require voters to approve online casino legalization at the ballots in November.
Operators would pay a 20% tax on live-dealer games and a 40% tax on all other games with 1% of all state proceeds going toward the state’s Problem Gambling Fund. Notably, the bill includes funds for casino employees that may lose their jobs due to iGaming as well as state jurisdictions that see casino revenues decline.
Along with existing casinos and online sports betting companies, there would also be opportunities for minority and women-owned businesses to hold licenses as well, which is a standard inclusion in Maryland gaming bills.
