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Proposed Maryland Sports Betting Regulations Released

Mike Noblin
Written by Mike Noblin
July 15, 2021
proposed maryland sports betting regulations

The state of Maryland took another critical step to possibly being able to go live with legal sports betting by the fall of 2021. The Old Line State recently released a draft with 228 pages worth of sports betting regulations. The entire proposal will be discussed at the next Maryland Lottery and Gaming Control Commission meeting.

Maryland residents voted in favor of legalized sports betting back in November of 2020, but like other states, it’s taking several months of discussions to hammer out the specific details. Maryland Governor Larry Hogan signed the legislation to legalize sports betting within the state back in May after the Senate unanimously passed bill HB 940.

It looks as if all parties involved want sports betting to be up and running in Maryland by the kickoff of NFL football in September of this year.

Maryland is anxious to make sports betting available to its citizens because of the huge amount of tax revenue it will bring in for the state. All sports betting revenue will pay a 15% tax rate. Rough estimates predict that Maryland could gain between $17 million and $19 million each year from sports wagering.

Details of Sports Betting Regulations in Maryland

The current draft outlines two different classes for retail sports betting licenses: Class A and Class B. 10 Class A licenses have been proposed as well as 40 Class B licenses and up to 60 mobile licenses. The Class A licenses are split up into two separate divisions.

The Baltimore Ravens, Baltimore Orioles, Washington Football Team, and any future pro sports teams within the state will be considered in the A-1 level. Casinos with more than 1,000 video lottery machines will also fit into the A-1 division of licenses. Each class A-1 entity must pay a $2 million application fee and $6 million for a license bond that is good for five years.

Both of Maryland’s horse racing tracks, Laurel Park and Pimlico Race Course, will be in the A-2 license category. Casinos with less than 1,000 video terminals will also be in the A-2 tier. All A-2 licensees will have to pay a $1 million application fee as well as $3 million for a license bond.

Class B will also be divided into two categories: B-1 and B-2. B-1 licensees like the Maryland State Fairgrounds will be asked to pay $250,000 in application fees and a startup bond fee of $750,000. Smaller companies with 25 full-time workers or less and $3 million or less in yearly sales will make up the B-2 class. B-2 organizations will be charged $50,000 in application fees and a startup fee of $75,000.

What are the fees for mobile sports betting operators in Maryland?

Companies that want to run an online sportsbook in the state of Maryland will be charged an application fee of $500,000. These entities will also have to pay $1.5 million for a license bond that is good for five years.

Each company will also be charged a license renewal fee of 1%. That 1% fee amount will be calculated by taking the average sports betting revenue from the last three years. A performance bond of $1.5 million is also required for all mobile sportsbook operators.

Maryland Sports Betting to take Major Stand for Diversity

Maryland senators and representatives want to see a wide range of diversity within their state when it comes to the sports betting industry. Sportsbook companies that are owned by minorities or women may be able to open up sooner than other entities. This possible head start would give these companies a greater chance of success in the sports betting business.

The proposal calls for $3 million in donations to Bowie State University and Morgan State University, both of which are primarily attended by African American students. The purpose of the donations will be to set up a Center for the Study of Data Analytics and Sports Gaming at each respective university. This will give students the opportunity to expand their knowledge and possibly work in the sportsbook industry upon graduation.

The state of Maryland wants to ensure that the focus on diversity within the sports betting industry will last over the long haul and not just the first few years. All companies with a sportsbook license must submit a detailed report each year about their business involvement with women and minorities.

The Maryland Lottery and Gaming Commission will hold the entire sports betting industry within their state accountable for this initiative by submitting periodic reports to the Maryland General Assembly about the diversity of all B-1 and B-2 license holders. The first report will be reviewed near the end of 2025. This report will also recommend when and if to add more Class B and mobile licenses within the state.

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