Maryland iGaming Bill Gets Hearing as Brick-and-Mortar Play Wanes

Posted on: February 23, 2024, 08:56h. 

Last updated on: February 23, 2024, 10:53h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Maryland iGaming legislation is set for a committee hearing in the state Senate next week. The consideration of online casino gambling comes as play continues to slow at the state’s six brick-and-mortar commercial casinos.

Maryland iGaming casino revenue
The exterior of Horseshoe Baltimore, one of six casinos in Maryland. The Horseshoe and five other brick-and-mortar casinos experienced a slowdown in slot and table game win in 2023. The decline comes as state lawmakers consider authorizing iGaming. (Image: The Baltimore Sun)

State Sen. Ron Watson (D-Prince George) introduced Senate Bill 603 in late January. The measure seeks to allow the state’s six casinos to each partner with up to two online casino operators.

SB 603 would require a $1 million upfront fee from approved online casino platforms. Gross gaming revenue from interactive slots and table games would be subject to a 47% tax.

Watson and other supporters of online gaming say iGaming would deliver the state an estimated $300 million a year in new tax revenue. They also claim that consumers desire the convenience of playing casino games from the comfort of their homes.

SB 603 is set for a hearing in the Senate Budget and Taxation Committee next Wednesday, February 28. If the bill passes each chamber and is signed by Gov. Wes Moore (D), Marylanders would have the final say on iGaming during the November election.

Marylanders can currently bet legally online through a regulated sportsbook. No casino slots or tables are permitted on such apps and websites.

Bad Timing?

A recent study concluded that iGaming doesn’t negatively impact physical casinos. The researchers said online casinos complement land-based casinos and “help boost revenue for operators’ brick-and-mortar properties.”

Whether that’s true is debatable.

Pennsylvania and New Jersey casinos last year posted small brick-and-mortar revenue gains of 1.6% and 2.2%, respectively. Meanwhile, iGaming in those states respectively surged 28% and 16%.

In Michigan, another state with iGaming and in-person casinos, the numbers told a different story. Gaming win at the three casinos in Detroit — the only place where commercial casinos in Michigan operate — fell almost 3% last year. Online casinos, meanwhile, saw revenue climb more than 15%.

Maryland, of course, doesn’t have online slot and table gaming. Yet in-person play last year at state casinos fell more than 3%.  MGM National Harbor in Oxon Hill, Live! in Hanover, Horseshoe Baltimore, Ocean Downs in Berlin, Hollywood Perryville, and Rocky Gap in Flintstone won $68.5 million less than they did in 2022.

January maintained the revenue slide, as the six casinos reported an 8% year-over-year casino win reduction.

Union leaders who represent the more than 15K workers employed at the six casinos are against iGaming on concerns that such gaming expansion would result in layoffs. Tracy Lingo, president of the Unite Here Local 7 union, says allowing people to stay home to gamble means bartenders, waiters, cooks, housekeepers, dealers, slot attendants, security personnel, hosts, and other positions are less needed.

iGaming ‘Big Enchilada’

Watson tells iGaming opponents that the state needs more revenue.

“We have to increase revenues or reduce expenditures. iGaming is the last piece of the four-legged stool related to casinos and gaming. We need to be able to capture that revenue,” said Watson.

iGaming is really the big enchilada,” the lawmaker declared.

Along with job concerns and casino revenue losses, opponents have voiced concerns about gambling addiction. Watson says the iGaming industry has adequate protocols to address problem play, including operator-initiated cooling-off periods and third-party outreach support.