House Online Casino Bill Sponsor Testifies At Maryland Senate Committee Hearing

Written By Steve Schult on March 27, 2024
A picture of the bill's sponsor Del. Vanessa Atterbeary

On Tuesday, the Maryland Senate had its first committee hearing on the House’s online casino bill.

Del. Vanessa Atterbeary, author of House Bill 1319, attended the Senate Budget and Taxes Committee hearing to provide an overview of the bill, which passed the House in mid-March.

The bill provides a regulatory framework for Maryland online casinos. If passed in the Senate and signed by the governor, Maryland voters still need to approve it in November.

At Tuesday’s committee session, HB 1319 was one of more than two dozen House bills to receive a hearing. Committee members discussed the bill for about 20 minutes. The next step is to bring up the bill at a Senate Budget and Taxation Committee voting session.

The committee does not currently have any voting sessions on its schedule.

Bill sponsor spotlights bill’s education funding

Atterbeary explained to the committee that her prime motivation to get HB 1319 passed is to use the tax revenue to fund The Blueprint for Maryland’s Future.

Passed in the General Assembly in 2021, the Blueprint was designed to increase public education funding by $3.8 billion every year through 2031. Atterbeary said the program is running out of money.

“I do not gamble and have no interest in gambling. I put this (bill) in because I’m very passionate about our children, which I know all of you are. As all of you know, we are running out of Blueprint funds come 2028. So, this is the House’s way to generate funds specifically for the Blueprint. I am passionate about not walking back that commitment.”

Bill includes several diversity, equity provisions

Atterbeary also said her bill differs from similar legislation heard in the Senate previously because of its focus on diversity, equity and inclusion.

“The legislation is designed in a way that promotes the implementation of the law in a manner that maximizes the ability of minorities and women to participate in the iGaming industry.”

The diversity focus is similar to the legislation surrounding cannabis legalization, which voters approved via a ballot measure last year. Some of the provisions include:

  • Licensees must demonstrate at least a 5% ownership by an individual who qualifies as a social equity applicant.
  • Each licensee has to submit a diversity plan within 30 days of receiving the license.
  • Requires meaningful minority participation in the procurement of goods and services related to iGaming.
  • The state’s six casinos can get up to three online casino licenses, but the third license is dependent on meeting certain social equity requirements.

Cannibalization concerns addressed by employee fund

There have been conflicting studies about the potential online casinos have to take away revenue and jobs from brick-and-mortar casinos.

Some say iGaming has a negative impact, while others suggest that it increases land-based business.

Atterbeary told the committee that to address concerns regarding the potential cannibalization, HB 1319 would divert $10 million of tax revenue for “salary recoupment” to assist employees who might lose their jobs at casinos due to iGaming.

“If you are displaced by your job, you can go and get your salary, on top of unemployment from the state.”

Senator inquires about minority impact of iGaming

Sen. Joanne Benson was the only committee member to ask detailed questions during the hearing. She asked if Atterbeary had read a recent report that came out of Morgan State concerning iGaming’s “devastating” impact on people of color.

Though she didn’t specify which report in the hearing, she was likely referring to Dr. Ali Emdad’s recent report, “The Socio-economic Impact of Legalizing Interactive Gaming (iGaming) and Online Betting in Maryland.”

Atterbeary said she hadn’t read the report, which largely focuses on problem gambling concerns. Emdad’s report cites a Rutgers University study that found that 40% of online gamblers reported having problem gambling issues. African Americans and other minority groups, the report said, “were two to three times more likely to be high-risk gamblers.”

Benson also asked about the impact on the residents and other businesses in communities in which casinos are located if iGaming leads to job loss. Michelle McGregor, an advisor from the Sports Betting Alliance, attended the hearing with Atterbeary.

McGregor told Benson that what the SBA has seen from its clients (which include iGaming operators like BetMGM and DraftKings) and recent studies is that iGaming is “additive to land-based casino gaming.”

“We really strongly believe that’s the case. For states where casino gaming revenue was on the decline or stagnant, they have since seen increases in their land-based revenue (since iGaming was introduced).

“So, I think that would reinforce sustainability for jobs and even the existing businesses around casinos. I think that’s why casinos embrace iGaming. It’s another way to attract customers to their bread-and-butter product.”

Photo by AP Photo / Brian Witte
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Steve Schult

Steve Schult has covered the gambling world for the last decade. With stints as a staff writer for the World Series of Poker and Bluff Magazine, as well as the online content manager for Card Player Media, the New York native covered high-stakes poker tournaments and the overall casino industry. He’ll shift most of his focus to the Virginia, Maryland and Florida markets as a managing editor for Catena Media.

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