Most of Maryland’s retail casinos expressed support for the state’s iGaming plan during a Feb. 26 hearing, but resistance from workers’ unions remains. The online casino bill’s sponsor, Del. Vanessa E. Atterbeary, showed her commitment as she took no breaks during a seven-hour-long committee hearing that included five hours of testimony from HB1319 stakeholders.
About 3.5 hours into the Maryland House of Delegates Ways and Means Committee hearing, Howard Glaser noted the marathon-length gathering.
Before Glaser, the global head of government affairs and legislative counsel at Light and Wonder (LNW), testified in favor of HB1319, he said:
I admire your stamina at this hearing. Thank you.
While the committee reconvened later for 15 minutes of votes on other bills, the body didn’t advance HB1319 on Feb. 26.
Elizabeth Twigg, Atterbeary’s chief of staff, clarified that for Bonus on Feb. 27.
Twigg told Bonus:
That is correct. HB1319 will need time in subcommittee to be worked on and possibly amended. It is not customary for a bill to be put on a vote list right away after a hearing, to allow for internal committee discussion and collaboration.
Atterbeary’s Maryland Online Casino Bill
Atterbeary, D-Howard County, introduced HB1319. State Sen. Ron L. Watson, D-Prince George’s County, is moving SB603 through the Senate. The hearing on his bill is scheduled for Feb. 28.
While the online casino and poker bills have many commonalities — both leave the final decision to voters in a November referendum — they differ in meaningful ways.
For instance, Atterbeary’s Maryland online casino bill outlines a 55% tax rate on operators and a 20% tax on live dealer games. In the latter, human croupiers deal cards, roll dice, and otherwise play table games in real-time with online casino gamblers.
Therefore, the Fiscal and Policy Note for House Bill 1319 is unique to her bill in reporting possible iGaming revenue.
The fiscal note showed legalizing online casino and poker gambling in Maryland in 2024 may yield $6 million in revenue during Fiscal Year 2025. In Fiscal Year 2026, the first full 12 months of the marketplace, Maryland can expect $539.4 million. Once the market is more mature in Fiscal Year 2029, Maryland may see $904.9 million in revenue under Atterbeary and Watson’s bills.
That mature market tax revenue is close to the $900 million forecast in a feasibility study commissioned by the state’s regulator, the Maryland Lottery and Gaming Control Commission (MLGCC).
Meanwhile, Atterbeary’s bill also outlines authorizing 12 online gambling licenses. According to the Maryland online casino bill, each operator must include a 5% ownership stake for “individuals whose personal net worth does not exceed an amount determined by the commission.”
That ownership stake is Atterbeary’s effort to “encourage diversity, equity, and inclusion in the internet gaming industry.”
Virginia Cannibalization Testimony Was Absent
Watson has told Bonus that Marylanders should consider that the state’s casinos will see decreased foot traffic because Virginia authorized five commercial casinos. So, Virginians who now travel to gamble in Maryland may decide to stay within their borders soon. That will mean less revenue for Maryland, and legalizing iGaming could offset that loss.
That said, none of Feb. 26’s five hours of testimony regarding Atterbeary’s bill touched on Virginia’s casinos.
However, Urban One CEO Alfred C. Liggins III did testify in favor of HB1319, saying that he’d like to open a Maryland online casino skin.
His connection to Virginia retail casinos is more historic than current.
On Nov. 7, 2023, Richmond voters defeated a ballot measure that would’ve allowed media company Urban One and Churchill Downs Incorporated (CDI) to build the proposed Richmond Grand Resort and Casino.
It was the second election defeat for Urban One, which originally proposed a 100% minority-owned One Casino and Resort as Virginia’s fifth and final retail casino.
Liggins, who is Black, emphasized the DEI portion of Atterbeary’s bill. He said if the Maryland online casino bill becomes law, he’ll offer an Urban One-branded iGaming site, and he’ll build a production studio in the state. Liggins said his Silver Spring-based media company already reached 82% of Black Americans and the percentage is higher in Maryland — possibly 90%.
He promised to bring jobs to Maryland and integrate online casino content into broadcasts if he became a licensee.
Testimony in Favor of HB1319
On Feb. 26, supporters and opponents of the Maryland online casino bill were limited to two-minute statements. So, advocates clocked in three hours of testimony in favor of legalizing online casino and poker games. Opponents spoke for 120 minutes.
More than 20 Maryland online casino bill advocates tended to emphasize the same topics:
- Legalizing online casino and poker gambling will generate revenue
- Because online casino and poker games appeal to younger gamblers — Glaser listed the average age at 35 — casinos partnering with them can market to the new audience, which will then visit the land-based facilities
- Live dealer studios will need to hire about 1,000 union workers, which will mean more jobs for Marylanders
- The tax revenue will fund Maryland schools — especially pre-K
- Legal online gambling will protect Marylanders from the illegal offshore gambling sites where Atterbeary says they’re spending $200 million annually
- Bordering states of Delaware, Pennsylvania, and West Virginia already legalized iGaming
- 1% of revenue will benefit problem gambling efforts, “which was not done in sports betting,” Atterbeary highlighted. Maryland’s online sportsbooks launched in November 2022.
Requested Maryland online casino bill amendments
A common request from retail casino representatives was that Atterbeary lower the online casino operator tax rate to a “reasonable” level.
That suggestion came from Rick Limardo, senior vice president of government affairs at MGM Resorts International (MGM Resorts International 39,81 -3,14%).
“Reasonable” is 15%, according to Randy Conroy. He is the senior vice president and general manager of the Horseshoe Casino, which is a Caesars Entertainment (Caesars Entertainment 43,24 -2,81%) property.
Jonathan Carpenter proposed a 28% tax rate, which is about half of what Atterbeary outlined in the Maryland online casino bill. Carpenter — a vice president of government affairs at Greenwill Consulting Group — was representing Rocky Gap Casino, Resort and Golf in Flintstone, a Century Casinos property.
Please decrease the $1 million licensing fee on operators, requested Antonio Jones. He is a gaming license owner at Riverboat on the Potomac. In February 2023, he testified in Atterbeary’s committee that Riverboat on the Potomac was “the first 100% minority-owned sports betting licensee (retail and mobile) in the country.”
House Minority Leader Jason C. Buckel, R-Allegany, responded to the suggestions to lower the tax rate:
It becomes a blip.
For instance, he thinks the 15% tax rate on Maryland online sportsbooks is low:
They are not paying for much of anything.
Proposal: Untethered licenses
Uri Clinton — an executive vice president, general counsel, and corporate secretary at Boyd Gaming — asked Atterbeary to change the Maryland online casino bill from 12 operators to 23. He thought each of the state’s six commercial casinos could partner with three skins, and five licenses could then be “competitive.”
Clinton explained that Boyd doesn’t have a casino in Maryland, and an untethered license would allow his company to invest in the state.
Even before Clinton testified, Conroy and Limardo objected.
Conroy justified his objection with the comment that land-based casinos have the most practice with responsible gaming.
He said:
All iGaming licenses should be tethered.
For Conroy’s casino, one of the tethered partners would likely be Caesars Palace Online Casino.
For Limardo’s MGM National Harbor, it would probably be BetMGM Casino. BetMGM is jointly owned by MGM and Entain (Entain PLC 762,60 -0,52%).
Testimonials Against HB1319
The next two hours of testimony in opposition to the Maryland online casino bill was almost completely about how iGaming may cause cannibalization of retail casino revenue and result in job loss that wouldn’t be offset by new live casino employment.
Almost everyone cited the Maryland regulator-commissioned research that said if the market remains status quo, iGaming would cannibalize 10% of retail casino revenue. Watson believes that study doesn’t account for possible cannibalization from Virginia casinos opening up.
Casino workers and representatives from several unions testified.
Donna Edwards — president of the Maryland and DC AFL-CIO — testified:
We believe Maryland should not take a risky bet. … iGaming is not a panacea.
Some bill opponents said online casino live dealers don’t fare as well in gambler tips as retail casino dealers do.
Tracy Lingo, president of Unite Here Local 7 Baltimore, said of its casino worker members:
Those workers make most of their money from tips.
Two opposed casinos
Mark Stewart — executive vice president and general counsel for The Cordish Companies, a Baltimore-based company — spoke on behalf of Live! Casino Hotel Maryland.
He said even though his company was opposed to legalizing iGaming in Maryland, Cordish would apply for a license if it becomes law.
However, Ocean Downs Casino is firmly opposed to the Maryland online casino bill, said Bobbi Jones. The casino’s general manager then answered questions about the casino’s parent company, CDI.
In Pennsylvania, CDI’s Presque Isle Downs partners with Bet365.
Bobbi Jones said Presque Isle Downs lost 45% of its workforce and 15% of its revenue as a result of Pennsylvania legalizing iGaming.
Atterbeary read from a CDI press release that talked about how excited CDI was to partner with Bet365 in Pennsylvania. She said she was “offended” that it was okay for Pennsylvania to allow iGaming but not so for Maryland.
About the Author
