Maryland iGaming sees signs of public support, union opposition
Conflict is intensifying over the prospect of bringing internet casinos to Maryland.
After the iGaming bill failed to advance earlier this year, expectations are growing that the issue may be back on the agenda in the new state legislative session in 2024. There are signs that public support for playing poker, slots or roulette on a laptop or mobile phone is growing. But union officials in the state warned that online gambling would lead to job losses at the state's six casinos.
Meanwhile, a recent state-commissioned report concluded that iGaming will quickly become a nearly billion-dollar industry.
Maryland lawmakers failed to take action on an online gambling bill introduced this year and adjourned it in the spring. But there are signs the issue will be back on the agenda when lawmakers begin the new session in January. The Office of Policy Analysis of the Department of State Legislative Services has included iGaming in a recent comprehensive report on key issues that may be considered next year.
$900 million market
The Maryland Lottery and Gaming Control Board, which regulates sports betting and casinos in the state, also recently released a iGaming Outlook for the State Report. The state hired The Innovation Group, a Las Vegas-based consulting firm, to prepare the report.
The report estimates that iGaming will generate more than $533 million in total revenue in its first year, with revenue rising to $900 million over the next three years before stabilizing. The report states that the addition of iGaming will reduce land-based casino revenue by approximately $200 million once the online market matures.
iGaming tax rates will be a key consideration in any upcoming legislative push, with the report outlining options between 10% and 30% of gross revenue. While online gambling should generally be taxed at higher rates than land-based casinos, the report said this consideration must be balanced against policymakers' desire to lure players away from existing black market online casinos. Maryland currently taxes table games at 20 percent.
The report states, “Given Maryland’s current gambling taxes, imposing higher taxes on online gambling while expecting operators to aggressively market to players at illegal online casinos would be challenging.”
The report states that if the government wants to benefit from iGaming, the tax rate must be at least 15%. At that level, the state would generate $37.4 million in new tax revenue by 2029, compared with a loss of $7.8 million if iGaming were taxed at just 10 percent, the report said. Assuming total revenue remains constant under all circumstances, the state would receive nearly $308.9 million if the tax rate were set at 45 percent, the report said.
The report also raised concerns that incidents of problem gambling will increase with the introduction of online gambling, as has been reported in Pennsylvania and New Jersey. The authors also point to a robust problem gambling program that exists in Maryland, noting that a portion of iGaming proceeds will be used toward these efforts.
Poll: 75% voted yes
New Poll finds 75% of Marylanders say they would vote for an online casino legalization measure if it were placed on the 2024 ballot. The survey, commissioned by MDBetting.com and conducted by online polling firm Pollfish, Inc., surveyed 1,000 self-identified registered voters and found strong gains across all subcategories (by age, gender and education level). Strong support.
The survey found that 83% of men support online casinos, compared to 69% of women. By age, support is lowest among the youngest voters: 63% of voters aged 18 to 24 support online casinos, compared with 72% of those over 54 and over 80% for all other age groups.
Maryland lawmakers must vote to put the issue on next year's ballot before it goes to voters.
Union warns of job losses
The prospect of iGaming has employees at land-based casinos in Maryland worried. In an editorial published Wednesday, two union leaders said the Lottery Commission's report failed to capture the job losses likely to occur as iGaming expands.
Jason Chorpenning, president of United Food and Commercial Workers International Union Local 27, and Shane Sterry, vice president of the Seamen's Recreation and United Union, urged lawmakers to reject iGaming.
Because the report focuses myopically on the gaming revenue these out-of-state and foreign companies may generate, it obscures the massive job losses in Maryland that will inevitably come with iGaming. ” Chorpenning and Sterry wrote in an op-ed for marylandmatters.org. “In neighboring Pennsylvania, for example, iGaming lost 2,000 jobs — nearly 10 of all land-based casino jobs in Pennsylvania. %. Many other states, like Indiana, say “no” to iGaming for the same reason — it kills jobs. "
With the governor being a Democrat and holding majorities in both chambers of the Legislature, unions are widely expected to have significant influence in the state capital.
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Source: www.casino.org
