Q&A with Maryland State Sen. Craig Zucker on Sports Betting

Q&A with Maryland State Sen. Craig Zucker on Sports Betting

Maryland voters passed sports betting by nearly a 2-to-1 margin on Nov. 3. The referendum question was a bare bones yes-or-no with tax money going toward education but with no details about what sports wagering would look like in Maryland.

The state legislature returns to business in January and on the agenda is passing a bill that fills in sports betting details. Maryland state Sen. Craig J. Zucker (D-Montgomery County) introduced a full sports wagering bill earlier this year that was approved unanimously by the Senate but ran into a roadblock in the House of Delegates, hence the yes-or-no referendum.

Zucker will be a key figure as Maryland shapes its sports betting future and Gambling.com talked with him about it. Answers have been lightly edited for flow and clarity.

Gambling.com (GDC): When you start work in January on sports wagering, is the General Assembly really starting from square one or will that previous work in your former bill serve as a foundation for crafting a new bill?

Sen. Craig Zucker: Back then, I felt that the Senate had a good, non-partisan product that passed unanimously out of the Senate and made it over to the House. And then a global pandemic hit. That basically put five seconds left on the shot clock and we had to adjust.

But I think the Senate bill that passed unanimously will be a template. A lot happens over nine months in terms of what other states have been doing and reminding everyone of where we were. Our biggest obstacle was making sure Marylanders approved it — and they did. We’re going to have work groups that are inclusive and transparent and we’ll work out the details there.

One reason that we wanted to get this done sooner rather than later is because all of our neighboring jurisdictions either have it up and running, or will be doing so soon. It does give us an idea of best practices — what they did right, what they did wrong — and we can use that as a road map.

GDC: The sticking point earlier this year regarding a sports wagering bill, as expressed by some members of the General Assembly, was a lack of minority and/or women equity ownership among the gambling operators who were likely to be doing business in Maryland. How might that issue be addressed?

CZ: It’s going to be addressed and needs to be addressed. That’s why when the Senate bill passed, we included a minority business component in that. So the effort and the intent was that we already were going to be focusing on that but I think how it will be addressed in the upcoming session is having everyone who would like to be at the virtual table — I‘d say at the actual table but since we’re still in this pandemic everything will be done virtually — so everyone will have the opportunity at the virtual table, and we’re going to have an inclusive and transparent process where everyone’s voice is heard and that we stay competitive with our neighboring jurisdictions and bring taxpayer money back to the state of Maryland.

GDC: The experience of other states with sports wagering tells us that the vast amount of wagering is done on the Internet (well over 80%). Do you anticipate Maryland will have online as well as retail sports wagering? And what’s your sense of whether remote online account registration will be permitted as opposed to requiring customers to go to a retail location to open an account?

CZ: It’s funny — I’m the sponsor of a sports gambling bill but I’m not a big gamer myself. However, if I were a betting man, there’s no scenario where online betting isn’t a part of this. I can tell you that there’s going to be an online and physical presence. I don’t want to get too far ahead of what the work group does … (but) I think (types of registration) is one of the easier pieces to figure out.

GDC: A point of contention in Maryland has been which businesses will be licensed for sports wagering. There are some who believe it should be exclusive to the state’s six casinos. Others believe the sports wagering landscape should also include race tracks and others. How does this get resolved?

CZ: It will be resolved. To what end, I’m not sure yet. I don’t want to get ahead of the work group and everyone having their voice heard at the table. But I imagine whatever the end product would be, it will include casinos and race tracks. What that looks like at the end, I’m not sure because the process hasn’t even started yet.

But my sense is, at least where it was in the Senate, there was no contention over (the inclusion of) ultimately the race tracks, off-track betting facilities, the casinos, the Timonium fairgrounds and a (Washington Football Team) sports facility. That’s what was included in the Senate bill that passed unanimously.

(Editor’s note: The previous sports facility inclusion required significant economic investment from the Washington Football Team and required entering into a memorandum of understanding with Prince George’s County government where the facility would be prospectively located).

GDC: The tax rate on sports wagering is always important. Some say that a tax rate that’s too high eventually forces sportsbooks to offer less attractive odds to customers. What’s your feeling about a tax rate?

CZ: The posture of how things were left in the Senate prior to the bill being completely amended was an 80-20 split (meaning a 20% tax rate), which was consistent with what the (casino) tables games are (taxed at). Instead of a tier for the tax rate, we had a tier for the license fee based on the number of video lottery terminals that the casinos had. We set up a different tier for the race tracks. … I feel like, in some ways, even though we aren’t restarting the process from the ground floor, we are going to be restarting the process making sure everyone is on the same page regarding certain items.

GDC: So, is 15% to 20% the sweet spot for a tax rate?

CZ: I think that was the sweet spot last year. I think we’re going to have to take a look at what neighboring jurisdictions are doing and figure out the best course of action. Let me highlight a few things I think are important and I think my colleagues would agree. One, I think it’s very important that Maryland is very competitive with other states. Two, that Maryland taxpayer dollars are returned back to the residents here in Maryland and not going out-of-state. And three, making sure we’re getting as much revenue as possible that would go into the Education Trust Fund, especially during this period of COVID when we don’t see an education gap, we see an education valley that’s more pronounced with each passing day.

GDC: Finally, the first question I am sure you are always asked: When will Marylanders be able to start placing sports bets?

CZ: I’m hoping by this summer or fall. Voters approved it by almost 2-to-1 across the state. As we speak, the Maryland State Lottery and Gaming Commission is trying to figure out what the regulations would be. Hopefully, when an inclusive and fair piece of legislation passes regarding sports betting, we can get it up and running as soon as possible.