A Maryland online casino bill received pushback from the House Ways and Means Committee and a county chamber of commerce even before it was published. Bill sponsor Ron L. Watson responded to Bonus about the criticisms, including those in research commissioned by the Anne Arundel County Chamber of Commerce.
Watson, D-Prince George’s County, will propose iGaming legislation. However, as of Jan. 19, his Maryland online casino and poker legalization measure hadn’t been published. Therefore, it doesn’t yet have a bill number.
Watson told Bonus on Jan. 19:
Today is the last day to file a bill and be guaranteed a hearing. I hope to see the final version on Monday.
Once the bill is officially introduced in the Senate, it must have approval from that body first. Then, it will move to the House before a vote there may allow Marylanders to see a statewide ballot measure in November. The vote is necessary to change the state constitution.
If the Maryland General Assembly authorizes the ballot measure and voters approve it, legal online casino and poker games may be available by July 1, 2025.
That means the still-to-be-published iGaming bill is receiving intense scrutiny at least 18 months before Maryland online casino and poker sites could accept any bets.
Watson is ready.
He told Bonus on Jan. 19:
Now is the time for Maryland to lead!
Maryland Online Casino, Poker Bill Details
Watson showed Bonus a draft of his bill. Online gambling operators would pay a 46% tax rate; 1% of revenue would fund problem gambling efforts; and two operators could partner with a land-based casino licensee, yielding 12 sites.
That matches the current number of online sportsbook operators. Those companies have been paying a 15% tax rate since online sports betting launched in November 2022. During 2023, the state collected $46.2 million in taxes as a result, according to Gaming Today. Bonus and Gaming Today are Catena Media publications.
Legalizing online casino and poker gambling may provide far more revenue for Maryland than sports betting does now. Bonus found states with iGaming and online sports betting tend to see a 70% to 30% split, respectively.
Gross gaming revenue (GGR) from iGaming could reach $900 million annually as early as 2026, according to a study commissioned by the regulator, the Maryland Lottery and Gaming (MLG).
MLG received the research in November 2023. On Jan. 18, lawmakers attended a briefing about it.
Questions Enter House Committee Briefing
On Jan. 18, House Ways and Means Committee members heard details about research the gaming regulator commissioned.
Maryland Del. Vanessa E. Atterbeary, D-Howard County, said the committee she heads will hold a hearing on the research later.
While the committee’s chairwoman emphasized that the meeting was a “this is not a hearing, it is a briefing,” lawmakers honed in on the study’s finding that iGaming would decrease retail casino revenue by 10%. Land-based casino jobs would also decrease by between 4% and 8%. However, live dealers for online casinos would add personnel to the state workforce.
In 2023, Maryland’s six commercial casinos saw $1.33 billion in slot revenue and $648 million brought in by table gameplay, Catena publication PlayMaryland reported.
iGaming Concerns
Meanwhile, many lawmakers objected to the possible retail casino revenue and job losses, as the Catena publication PlayUSA also reported.
Committee Vice-Chairwoman Jheanelle K. Wilkins, D-Montgomery County, immediately raised revenue and job loss concerns.
She said:
I would imagine that, and I know that, there’s investments in the physical space, so that you don’t have to leave. Once you arrive — whether you’re there for gambling, you’re there for an event — they’ve invested in ensuring that there’s everything you need that’s there. There’s a concern that when you have less bodies there, what does that mean? Not just for revenue, but in terms of our casinos investing in the physical space, the physical infrastructure, that also brings in jobs and also helps build up the entire community around there, in terms of economic development.
Watson Responds
Watson told Bonus on Jan. 19 that legalizing iGaming would keep more money in the state. He said Maryland can’t stand still because it will soon have retail casino competition from Virginia. Right now, many Virginians are venturing into Maryland to gamble.
He said to Bonus:
It is also important to note that outside of Nevada, MGM Grand, located in Prince George’s County Maryland was the top US casino last year in terms of gaming revenue. That is $884.46M which accounts for over 43% of total gaming revenue taken in by the state.
Virginia casinos, particularly if one is built in Northern VA, which is what the Virginia General Assembly will consider, is expected to reduce MGM’s revenue by an estimated 30%. That’s a $265M hit.
Again, we must consider the impacts of neighboring competition to this valuable revenue stream.
… It’s also worthy to note that an estimated 30-35% of MGM Grand’s current employees are Virginia residents. This impact would be felt in our workforce.
A Chamber of Commerce’s Research
On Jan. 17, Mark Kleinschmidt emailed Bonus a report his chamber of commerce commissioned about iGaming legalization in Maryland.
Kleinschmidt is the president and CEO of the Anne Arundel Chamber of Commerce.
The county contains Live! Casino Hotel Maryland, which is one of Maryland’s six commercial casinos.
The chamber’s press release said:
Legalization of iGaming in Maryland could result in a statewide personal income decline of $65M, a reduction of $1.9M in state income tax, and $1.2M in local income tax annually.
The announcement said the chamber identified the Maryland online casino and poker bill through its Legislative Watch Program. The program is designed to identify legislation that could harm businesses and result in job losses.
The press release said:
The report addresses five primary categories of risk including economic leakage, job destruction, negative employment impacts beyond the gaming industry, reduced capital investment, and business decline among entertainment destination clusters.
Watson Counters
Watson said his bill hasn’t even been published yet.
He told Bonus:
This report is short[-sighted] and nothing short of fear-mongering. While the author may have read the report, they have NOT read the bill because it hasn’t been released yet. Let me cover several fallacies with this report and lack of insight on the issues:
What follows in Watson’s response to Bonus is a point-by-point dispute of the chamber’s findings.
The chamber’s research said iGaming jobs tend not to be housed in the state they’re serving. Watson said live dealers would have to work in Maryland because the bill says studios serving Marylanders need to be in the state.
As it is, Maryland is about to see increased competition from Virginia’s land-based casinos.
So, Watson told Bonus:
In short, iGaming is a proactive measure to grow and SUSTAIN revenues.
The research claims that iGaming would cause an increase in problem gambling.
The chamber’s study cites the research Maryland’s regulator commissioned:
There are also broader social implications. The IG Report discussed at length in this memo notes that Pennsylvania and New Jersey experienced a rise in calls to their respective gaming helplines following iGaming legalization, noting that, ‘These higher incidences, if accurate, certainly make sense, since there are many decision points and hurdles between going from a place of residence to a physical casino. There is considerably less friction to open up an online casino on a mobile phone or tablet.’
In other words, iGaming presents a mechanism by which gambling becomes excessively accessible for those who find such activity irresistible to the point of generating self-harm, including the youngest and most susceptible Marylanders.
Bonus must note here that legal online gambling operators require proof of age in extensive identity checks. That ensures online gamblers are of legal age, as designated by each state.
Meanwhile, Watson rebutted the chamber’s finding:
This report is devoid of the positive benefits of using technology to combat problem gaming, nor does it address the NEW revenue stream to deal with this issue and other mitigation efforts.
Watson concluded:
It is my hope that these statements will encourage a more educated and objective dialogue not based on conjecture, but on facts. I encourage the opponents to read the actual bill once available.
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