Regulators Set Draft MD Sports Betting Regulations For Public Review

Posted on July 15, 2021 - Last Updated on July 19, 2021

One small step for regulators Thursday could become one giant leap for Maryland sports betting.

On Thursday morning, members of the Maryland Lottery and Gaming Control Commission (MLGCC) approved a set of draft Maryland sports betting regulations for public comment.

While the short meeting mostly represented a formality, it’s still a monumental step toward legal sportsbooks actually taking bets in the Old Line State. The provisional rules lay out specifics for many sections of the industry, including the relationship between the MLGCC and the newly created Sports Wagering Application Review Commission (SWARC).

Commission votes to submit Maryland sports betting regulations

In a meeting that took about half an hour, the MLGCC’s membership unanimously approved the regulations on Thursday. The 228-page document isn’t final now, however. It’s merely ready for public review. There will be a 30-day public comment period. So far, the Commission hasn’t publicized a start date for that period.

The text is quite comprehensive. It includes all necessary provisions for filling in the gaps left by the governing statute. It also provides crucial definitions of terms in the statute. For example, it lays out exactly who regulators must conduct background checks for in regards to considering license applications.

The tenets of the proposed rules also govern the exact roles of both the NLGCC and the SWARC in terms of approving potential licensees. Effectively, both bodies have their distinct roles in that determination.

So does the MLGCC or the SWARC issue licenses?

The answer is both. There are two sections that name the SWARC.

The first, from page 63:

“Unless a person holds a valid mobile sports wagering license awarded by the Sports Wagering Application Review Commission and issued by the Commission, the person may not conduct, offer, or operate online sports wagering in the State.”

And from page 52:

“The Commission shall issue a license to a person covered in this chapter, on an award of a license by the Sports Wagering Application Review Commission to an applicant that meets the requirements for licensure under State Government Article Title 9, Subtitle 1E, Annotated Code of Maryland.”

Thus, the SWARC will also need to draft its own set of standards for application considerations. It isn’t clear how quickly that will occur. It does seem that interested parties will need to complete applications for both bodies, however.

Other areas of interest for potential applicants and bettors include language addressing allowable events, official league data, and online “skins.” For the most part, provisions on those items represent industry norms.

What the rules say about other particulars of interest

On page 213, the rules state that “a mobile sports wagering licensee may utilize only one individually branded website to accept and pay sports wagers.” Thus, each licensee gets one “skin.” Because the law allows for up to 60 licenses, though, there’s no concern about a lack of competition.

On page 133 and others, the regs put the onus for requesting permissibility for sporting events on the licensees. However, it’s likely that the MLGCC will have one list of allowable events for wagering at some point. That’s standard practice in most jurisdictions.

As far as data mandates go, the language is very similar to other jurisdictions’ as well. Sport governing bodies such as the NFL can request the MLGCC require operators use official league data. At the same time, operators can ask for exemptions. They will need to prove that the data is too costly or onerous to use in that situation, though.

A final element of interest is a fee schedule for licenses. The statute included several different license categories. These rules make it clear exactly how much it costs to apply for and acquire each.

  • A1 licenses: $2 million to apply, $6 million for a five-year license
  • A2 licenses: $1 million to apply, $3 million for five years
  • Mobile license: $500,000 to apply, $1 million to secure the five-year license
  • B1 licenses: $250,000 to apply, $750,000 to get a five-year license
  • B2 licenses: $50,000 to apply, $75,000 for the license if approved

The greatest point of interest for bettors in MD is how this affects the timeline. While it’s a positive that these rules are out, it doesn’t necessarily mean MD sportsbooks will be live before the start of the next NFL season.

So, how do things look now?

Obviously, the fact that the public comment period should start soon is a step in the right direction. Although not finalized, these draft regulations give applicants a good idea of what they’re dealing with. That will allow them to get the ball rolling on their applications.

However, regulators can’t issue decisions until after the regulations become final. They can’t finalize the rules until after the public comment period. As previously mentioned, that hasn’t begun yet. So, at the earliest, applicants are probably looking at mid-to-late August before they get decisions on their applications.

The next NFL regular season begins on September 9. That would only give regulators a few days to complete all their other responsibilities the Maryland sports betting regulations detail. In short, that would be nearly impossible.

The NFL playoffs or Super Bowl LVI still look like more realistic goals. That doesn’t mean this development isn’t substantial. It was absolutely crucial for the state to have a chance to offer legal sports betting in January or February.

Photo by AP / Patrick Daxenbichler
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