Maryland Sports Betting Bill Emphasizes Minority Participation

Maryland Sports Betting Bill Emphasizes Minority Participation
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Maryland continued to advance its efforts to craft online wagering legislation as the House of Delegates Ways and Means Committee held a long hearing Thursday on a sports wagering bill.

The panel heard testimony from a couple of dozen stakeholders, from casino operator representatives already in to prospective applicants for Maryland online betting apps licenses to principals of ancillary businesses who seek to participate in the industry once it’s up and running.

The bill under discussion, HB 940, was sponsored in early February by Adrienne Jones, speaker of the House of Delegates. It addresses sports wagering, both retail and online, with a surprise inclusion of new taxes on daily fantasy sports.

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The two main takeaways from the hearing is that Maryland is determined to see that minority-owned businesses, including African-American businesses and women-owned businesses, have an opportunity to participate in the state’s nascent sports gambling industry from the outset.

In addition, it was clear from testimony that a number of interested parties are encouraging that any sports gambling legislation increase the number of online gambling licenses from the 10 such licenses that are currently called for in the prospective bill.

Jones’ bill is the starting point for eventually getting sports wagering operating in Maryland. In November, voters approved sports betting by a 2-to-1 margin in a referendum and it’s up to the General Assembly to set the parameters.

The state Senate has yet to introduce its own bill. The Senate is convening work groups to help shape its own suggested legislation. In the end, the two bills will have to be reconciled before going to Gov. Larry Hogan for his signature.

Two Types of Retail Sports Betting Licenses in Bill

House Bill 940 calls for two types of retail sports betting licenses: Class A licenses would go to the state’s six casinos and to Maryland’s horse racing licensees; another five Class B retail licenses would be available to other prospective applicants.

As far as online licenses are concerned, the proposed legislation now caps that number at 10 with Class A licensees being first in line.

Some witnesses said the current configuration of how the retail and online licenses would pair up actually work against minority-owned businesses, which would be new to the Maryland gaming landscape, since the existing gambling/racing operators would already be assigned the bulk of the online licenses.

Suggestions for how the total number of online licenses should be increased ranged from 15 to as many as 20 or more with examples of how states with 20 to 30 online operators increase state tax revenues.

’Opportunity for Minority Business Owners’

The bill introduced by Jones strongly urges that there be minority participation, a point emphasized at the beginning of the hearing by Del. Darryl Barnes and echoed by Del. Eric Luedtke.

“The reality is that minority-owned businesses and particularly Black-owned businesses are at a significant disadvantage in the marketplace, have not had the same opportunities as other business in the marketplace,” Luedtke said. “So, in crafting this bill, the speaker set a clear agenda in that we want to create an opportunity for minority business owners, Black business owners, to own equity in these licenses in the way that this state has rarely if ever provided in the gaming industry.”

House Bill 940, Leudtke said, has been carefully crafted “to abide by legal standards but to set Maryland out as the national leader in providing opportunities for minority business ownership and minority business equity in the gaming industry … I’ve had people from all over the country tell me that Maryland is setting the standard.”