Marylanders hoping to place online bets on the Baltimore Ravens’ Week 1 opener against Las Vegas will likely need to find something else to do with the money burning a hole in their pocket.
While the state constitution was amended to allow for online sports betting in 2020, and a sports-betting bill was signed into law in May, betting cannot actually commence in the state until sportsbooks are licensed to operate within the borders of the Free State.
That’s where the holdup is.
At this point, it is unclear just which entities are going to be involved in the application and licensing process. The Sports Wagering Application Review Commission (“SWARC”) will play a major role, but it is a brand-new, fairly small (seven-person) committee, and Maryland’s new law allows for as many as 60 licensees. If the SWARC is the only entity involved, it will have an absolutely massive job on its hands.
If the larger and more experienced Lottery and Gaming Control Commission is also involved, the process will likely go faster.
This Thursday (July 15th), the state legislature is slated to address this and other lingering regulatory issues. By the end of the day, a timeline should be in place to bring online sports betting to Maryland. Given the number of details that still need to be resolved, pundits estimate sports betting is likely to commence in early 2022, not in time for kickoff for the 2021 NFL season as previously hoped.
Practically, that’s a big hit for Maryland, in particular the state’s tax revenue.
Working on the assumption that wagering would launch in September 2021, the experts at SportsBettingDime.com estimated that Maryland’s total betting handle for the first month would be $200 million. A $200 million handle would lead to just over $2 million in tax revenue for the state, and that doesn’t even account for the licensing fees, which can be as much as $2 million for each sportsbook.
The legislative framework dictates that a large portion of the tax revenue generated by sports betting will be used for public education programs. The money that would have been collected from September to December – i.e. during the 2021 NFL season – is unlikely to be recouped in the early portions of 2022. Reached for comment, SportsBettingDime.com editor Sascha Paruk stated that betting handle always declines as the football season wanes. The NFL is king in the American sports-betting market; after the Super Bowl in early February, there is a massive downturn in the spring and summer months – excepting the first two weekends of March Madness.
If sports betting is not active in Maryland come September – which appears more likely by the day – the state will be missing out on roughly $10 million in tax revenue from wagering, alone.
Of course, the flipside is that legislators have a huge responsibility to make sure sports betting in Maryland is fair, safe, and responsible. Here’s hoping they find the right balance.