Maryland Sportsbook Requests to Ease Incentives Rules Denied

Maryland sportsbooks' request to relax incentive rules denied

Maryland sports betting operators have repeatedly made requests to the Maryland Lottery and Gaming Control Authority (MLGCA) for looser incentives and promotion regulations, but have always been denied. That's according to records recently obtained by The Baltimore Sun.

In December 2021, Maryland began legal sports betting at five of the state's six brick-and-mortar casinos. The online sportsbook started operations last November.

In states that allow in-person and online sports betting, most betting activity is typically conducted over the Internet. Such is the case in Maryland. In May, for example, 95% of the $320.2 million was wagered online.

The MLGCA has issued 16 mobile sports betting licenses to date, with 10 licensees already operating online. These licensees join the land-based casino sportsbook and five additional retail sportsbook locations.

Because the state has a financial interest in the new liberalized online sports betting market and betting operators share 15% of their gross revenue with the state, the MLGCA encourages sports betting operators to regularly submit proposals for changes to state sports betting regulations .

Suggestion rejected

The Baltimore Sun reports that state-licensed sportsbooks have requested a number of sports betting regulatory changes, but the changes have not been well received by regulators. According to Maryland's largest-circulation daily newspaper, licensed sportsbooks have made numerous endorsements but have not yet received approval.

One of the regulatory changes sought by the gaming industry is for the state to require gaming operators and their marketing teams to notify the MLGCA of new promotions. Under the state's current rules, sports betting operators must notify the state of any new promotions within 48 hours before making the offer available to customers and detail the incentives and associated terms and conditions.

Instead, sports betting officials recommended that the state allow companies to submit terms and conditions to the MLGCA within five days of the start of a promotion. Oddsmakers believe that the sports betting market is fluid and promotions are often created on the fly.

Submitting promotions in advance of advertising/marketing efforts limits the ability to fully consider promotions because events that are attractive to sports bettors often come with unknown variables,” the proposal states.

Another legal change sought in the book involves the offer of "free" and "risk-free" bets, promotions that have come under scrutiny across the country as some punters say they were tricked into signing up by such marketing tactics. Sports betting provider. Many "free bets" are not actually free, but provide bettors with credit towards continuing their bets.

Sportsbooks in Maryland also asked the MLGCA to lift the cap on advertising fees paid to players, but were unsuccessful. Under state sports betting regulations, starting in 2024, sports betting operators can only use up to 20% of the previous year's gross sports betting revenue for promotional wagering. There is no cap in 2023.

The purpose of the advertising cap is to increase taxable revenue, as losses incurred by sports betting providers through ad gaming can be deducted from their overall revenue.

Big Bet

Maryland is a sports-loving state and is home to three professional sports teams, including the NFL's Baltimore Ravens, MLB's Baltimore Orioles and the NFL's Washington Commanders, who play at FedEx Field in Landover.

Maryland is also one of the wealthiest states in the country, with median household income of nearly $87,000 last year. That ranks first among the 50 states, trailing only Washington, D.C., at $90,800.

Between January and May 2023, Marylanders bet more than $1.81 billion on sporting events through legal books. This handle contains advertising inserts. Although taxable profits after advertising losses were only $124.9 million, the Oddsmakers retained about $225.7 million in bonuses.