The march toward Maryland sports betting took still another step today when the Sports Wagering Application Review Commission unanimously voted to award mobile sports wagering licenses to 10 entities that had been previously found qualified by the Maryland Lottery & Gaming Commission.
It is still not clear exactly when some or all of those online sportsbooks will begin taking wagers, but it is possible that some mobile sports betting will be available by Thanksgiving.
The next immediate step in the process is that each entity must submit a memorandum of understanding that they engage in good-faith efforts to interview minority and women investors in future attempts to raise venture capital or attract new investors.
Getting that done should be a formality.
However, another substantial step is that each company must exhibit that it can successfully operate an online sportsbook, plus comply with required procedures, in what is called a “controlled demonstration.”
Once that happens to the satisfaction of the Lottery & Gaming Control Agency, Lottery & Gaming issues licenses and the mobile sports betting can begin.
So far, Maryland has only retail sports betting at eight sportsbooks.
Lottery & Gaming intends to establish an “initial starting date” for the commencement of online betting but not all companies may be prepared to actually start on that yet-to-be-announced date - although regulators have expressed the hope that it be by Thanksgiving. Any company not ready by the initial start date can begin later.
The Group Approved Today
The 10 entities awarded licenses (and perhaps their better-known affiliate entities) are:
- Arundel Amusements, Inc. (Bingo World with Rush Street Interactive)
- BetMGM Maryland Sports, LLC (MGM National Harbor)
- Crown MD Online Gaming, LLC (DraftKings)
- CZR Maryland Mobile Opportunity, LLC (Caesars Entertainment/Horseshoe Casino Baltimore)
- Greenmount OTB, LLC (with PARX Interactive Maryland)
- Long Shot’s, LLC (with BetFred)
- Maryland Stadium Sub, LLC (FedExField, home of the NFL Washington Commanders with Fanatics)
- PENN Maryland OSB, LLC (PENN Entertainment/Hollywood Casino Perryville)
- PPE Maryland Mobile, LLC (Live! Casino & Hotel with FanDuel Sportsbook Maryland)
- Riverboat on the Potomac, LLCWA (with PointsBet)
So, as you can see, get ready for, as an example, a Caesars Maryland bonus code and those of the other entities.
The SWARC also has received 11 other applications for mobile sports betting licenses and six for competitive sports wagering facility licenses. Those will be considered in the future. The SWARC’s next meeting is Dec. 14.
Also today, the SWARC was provided with estimates of how much money will be generated for the sports betting businesses and for the state. The estimates covered 2023 through 2027.
For 2023, average projected gross gaming revenue (GGR) was about $178 million, although the bottom line (aggregate market performance) was an estimated loss of $36.5 million, mostly due to marketing spend of more than $131 million.
By 2027, the projected GGR for the 10 companies was $548.5 million and a bottom line increased to $197.2 million as revenues improved and marketing spend eased.
Tax to the state was estimated at $26.4 million in 2023, increasing yearly to $99.7 million in 2027. The sports wagering tax in Maryland is 15%.
Companies Maneuvering to Be in Right Place
In advancing the Maryland sports wagering law’s intent to encourage diversity in the industry and participation among minority and women stakeholders, there was a mandate that at least 5% of the online companies be owned by parties with less than $1.8 million in net worth.
The Cordish Companies-related business, PPE Maryland Mobile LLC, has arranged for up to 10% ownership by management-level employees. They can either purchase their share outright or take a loan that would be paid back from distributions by the company. In documents available yesterday, 86 employees had taken advantage and during the SWARC meeting it was mentioned that 91 were now participating.
SWARC Commissioner Frank Turner, a former state legislator, pointed out that one entity, the Riverboat on the Potomac, was minority-owned, and another, Long Shot’s, is woman-owned, as evidence that the commission was diligent in holding to the spirit of the sports gambling law regarding diversity.
The Caesars Entertainment LLC had announced previously how its partial ownership group was also adhering to the letter and spirit of the sports gambling law’s goals.
Technically, each company needed to be approved on two questions. The first was that in awarding a license that the action was in the public good. And the second was on awarding the licenses.
Among the several issues to be considered in whether the awarding of a license was in the public good was that it enhanced the state’s funding of education through the sports wagering tax revenue; advanced economic development and employment opportunities and helped regulate an otherwise unregulated illegal sports wagering market.
All 10 entities received unanimous approvals on both questions.
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