Firms urge Md. lawmakers to boost number of mobile sports betting licenses

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A House bill that would establish a sports betting framework in Maryland was the topic of a public hearing in the Senate Budget & Taxation Committee on Thursday.

And the session quickly became an audition, of sorts, for the many companies eager to grab a slice of the pie.

Testimony was dominated by representatives from Black- and female-owned firms. They urged legislators to maximize opportunities for minority companies, in part by expanding the number of mobile, or app-based, licenses.

House Bill 940 is sponsored by House Speaker Adrienne A. Jones (D-Baltimore County). The House approved it 129-10 on March 11.

Jones said her bill, the only sports betting legislation pending in the General Assembly, would bring Maryland even with neighboring states and generate revenue for education.

It also “maximizes the opportunity for minority businesses to meaningfully participate both in equity ownership and in procuring contracts in this new state-created industry,” she said.

House Majority Leader Eric G. Luedtke (D-Montgomery) told the Senate committee the measure would empower a new panel, the Sports Wagering Application Review Commission, to address “ownership disparities” in the gambling business “through the competitive bidding process.”

The legislation was vetted by the Attorney General’s office, he added, in the hope it can withstand potential legal challenge.

Jones’ bill would guarantee betting licenses for Maryland’s six casinos and to the teams that play in the state’s three professional sports stadiums.

The state’s busiest horse track, Laurel Park, would also be guaranteed a license, as would the State Fairgrounds in Timonium and the Riverboat on the Potomac, an off-track betting venue in Charles County.

In addition, 10 additional “bricks and mortar” licenses would be awarded to other companies — most likely restaurants, sports bars and racing venues — through a competitive process.

There also would be 15 “mobile” licenses, also competitively bid, for companies that want to take bets online.

Some of those who testified told the panel that adding even more mobile licenses to the bill would help minority and female applicants.

“There are no minority-owned and/or women-owned sports wagering companies in the marketplace,” Shane M. August told the panel.

August, CEO of Virginia Beach-based August Holding Corp., told lawmakers that states that have established sports gambling programs have practices that “heavily favor the large corporations and conglomerates.”

Several company representatives who testified on Thursday have been regular participants in the Senate’s informal sports betting work group. They cast their firms as ideal candidates for a wagering license, even though the committee will have little role in deciding who gets one.

After the hearing, Senate Majority Leader Nancy J. King (D-Montgomery) expressed a concern that companies may have unrealistic expectations about the new industry.

“There are just so many people that think they’re going to get rich real quick on this, and it’s not going to happen,” she said. “There’s only so much disposable-type income that people have.”

The state would tax “Class A” licenses (casinos, stadiums and Laurel Park) at 15%.

Holders of mobile licenses would be taxed at 15% for the first $5 million in proceeds and 17.5% after that.

Most of the revenue would go to the Blueprint for Maryland’s Future Fund, to benefit public education. Some money would be set aside to address problem gambling.

Sen. Craig J. Zucker (D-Montgomery), head of the Senate work group and sponsor of a 2020 wagering bill, said “we’re going to get sports betting done this year no matter what.”

“Half the country’s [already] doing it and it’s legal.”

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