Maryland is the latest US state to sign a piece of sports betting legislation into law.
On Tuesday, Maryland Governor Larry Hogan signed a piece of legislation that would legalise sports betting and fantasy sports.
This comes more than a month after the Maryland state legislature approved the legislation in April and sent it to the Governor for final approval.
What’s covered in the bill?
Under HB 940, online and land-based sports betting as well as daily fantasy sports is now legal in the state of Maryland.
The bill would make four different types of licenses available to businesses hoping to offer sports betting services in the state.
Class A license will be reserved for Maryland’s six casino facilities, three professional sports teams, and the Maryland Jockey Club.
Class A-1 licenses will be available to an operator of more than 1,000 video lottery terminals (VLTs), which includes the state’s casinos as well as the professional sports teams in the state. This includes the NFL‘s Baltimore Ravens and Washington Football Team as well as MLB‘s Baltimore Orioles. A Class A-1 licence would carry a $2m fee.
Meanwhile, Class A-2 licenses would be made available to the Maryland Jockey Club or an operator of 1,000 or fewer VLTs. These would cost hopeful operators $1m.
Class B licenses would also be made available to prospective sportsbook operators.
A Class B-1 licence would be made available to a bingo or simulcast racing operator with more than 25 employees and $3m in gross receipts. The Class B-1 licenses would cost $250,000.
Meanwhile, all other simulcast or bingo operators would be eligible for a Class B-2 licence, which carry a $50,000 fee.
The legislation permits the state to issue a maximum of 60 licenses for sports betting, of which up to 30 may be Class B licenses.
A mobile sports betting license, which would cost $500,000, will only be available to a business that holds a retail betting licence. A holder of a mobile betting licence would be able to partner with just one online betting operator to offer an online betting skin.
HB 940 also set a 15% tax rate for sports betting in the state. According to the fiscal note attached to the legislation, this could generate $17m and $19m annually between the 2022 and 2026 financial years.
The legislation also requires an appropriation of $3m to be awarded to historically Black colleges and universities in the state. Also, at least $10m from sports betting tax revenue will be put towards funding K-12 education.
Although the activity is now legal, the state regulator still needs to craft rules and regulations before sportsbooks can enter the market and begin taking bets.
The road to sports betting in Maryland
In November 2020, Maryland was one of three states where voters approved measures for legal sports betting.
In Maryland, 66.2% of voters were in favour of bringing legal sports wagering to the state. The measure also received support from high-ranking government officials including the Governor.
Although sports betting was approved in November, the legislature was not required to enable the legislation this year. However, the Senate chose to make the legislation an “Emergency bill” which would allow it to come into effect once signed.
This means that the Maryland State Lottery can start developing regulations immediately.
If the rules and regulations are drafted and approved, the state could have legal sports betting by the end of the year.