Action has increased more than tenfold since Maryland online sports betting went live on Nov. 23, 2022. Not only has it boosted sportsbooks’ bottom lines, it has helped Maryland’s economy and schools, primarily through the Blueprint For Maryland’s Future Fund.
The fund has collected $16.8 million since it began with retail sports betting in December 2021. It’s funded through the state’s 15% tax rate on all sports betting revenue. Around two-thirds of that has come from mobile sports betting. Future contributions will only go up due to fewer promotional deductions and the market reaching maturity.
Let’s take a deeper look into how these funds improve Marylanders’ lives.
Blueprint is meant to bring equity to Maryland education system
In 2018, Maryland lawmakers wasted little time trying to legalize sports betting in the state. A Supreme Court decision on allowing states to offer gambling was still to come when the first Maryland sports betting bill was introduced at the Maryland Capitol. Even though that effort failed, lawmakers were able to get sports betting on the ballot in 2020. Voters overwhelmingly approved it.
The Blueprint is a 10-year plan to add $3.8 billion in annual education funding through 2031. It is an unprecedented program focusing on affecting change in every facet of Maryland’s public education system to transform it into a world-class model.
The program sets new standards for prekindergarten through 12th-grade education, creating a road to career readiness. It also increases teacher salaries and incentives, making the profession more attractive.
At its core, the Blueprint prioritizes equity. It looks to enhance student experiences and expand access to resources, especially for those in historically underprivileged areas and with special education needs. Funding comes through a 12-component formula.
First, schools receive financial resources per pupil, starting at $8,310 per student in the 2022-23 school year. Additional weighted amounts then go to schools, depending on the needs and characteristics of their students. The final component comes from program aid, providing services such as transportation.
The Blueprint’s five pillars
Two separate bills passed in 2020 to bring the Blueprint to the foreground. However, the three-year Kirwan Commission led up to it, laying the foundation for the Blueprint to come to life.
The commission included teachers, education advocates, legislators and consultants. It provided recommendations to benefit students and educators, abolish achievement gaps in underserved communities and prepare students for college and future careers.
Based on these suggestions, the Blueprint established five pillars “to elevate every child to reach their full promise and potential.”
- Early childhood education: Expand infant and toddler programs, full-day Pre-K for 3- and 4-year-olds.
- High-quality and diverse teachers and leaders: Increase teachers’ salaries to $60,000 by 2026 and grow the pipeline of teachers who want to transform Maryland’s education system.
- College and career readiness (CCR): Creates a new CCR standard, along with the goal of all students meeting that standard by the end of 10th grade. This includes a post-CCR pathway to build on students’ strengths.
- More resources to ensure that all students are successful: Provides additional funding and services to special education students, English learners and struggling learners. Establishes or enhances community schools in areas of concentrated poverty.
- Governance and accountability: The Blueprint’s Accountability Implementation Board and Expert Review Teams analyze data to determine inefficiencies, develop strategies and hold all agencies and institutions accountable for their parts in the program.
Sports betting tax contributions to Blueprint likely to increase
Sports betting’s $16.8 million Blueprint contribution may be small for now, relative to its 10-figure annual price tag, but it only shows the tip of its iceberg.
Its first year brought $6.1 million before mobile sportsbook apps entered the picture. Even after apps went live at the end of November 2022, the year ended with low numbers due to sportsbooks deducting their promotional spend from overall revenue.
Maryland state law allows for unlimited spending on promotional budgets in the first year of mobile operations, but future years’ budgets are capped at a percentage of overall Maryland sports betting revenue. This incentivizes sportsbooks from “losing” too much in a given year, and sportsbooks are already adjusting with the future in mind, as the numbers showcase.
- November: $705K
- December: $440K
- January: $2.1 million
- February: $2.8 million
- March: $5.3 million
Numbers will drop down through the warmer months of the year before reaching new highs during football season. By year’s end, sports betting should generate over $30 million for the Blueprint fund.
Maryland sports betting creates additional taxes and economic gains
Beyond the Blueprint, mobile sports betting generates additional tax revenue from winning bettors. This money factors into Maryland’s operating budget, which accounts for a wide range of uses throughout the state.
Out-of-state visitors pay 7.5% on all winnings over $5,000, too. Yes, sports betting is legal in most states throughout the US (including all three that border Maryland), and it’s safe to say that mobile betting is not enough reason to visit Maryland on its own.
Nonetheless, Maryland’s pre-pandemic annual tourist visits totaled above 40 million. Assuming those numbers return to form, millions of tourists will now place some wagers when they visit The Old Line State.
Gambling helps Maryland redefine education
Sports betting is only one way gambling contributes to Maryland’s education system.
The other two are Lottery and casino gaming, which combined for over $1.5 billion in state contributions during FY 2022. Lottery profits added $673 million to the state’s general fund, and the remaining $832.3 million came from casino tax revenue.
The vast majority of that tax revenue – $611.6 million – went to the Education and Trust Fund (ETF), which supports early childhood education, public schools and capital improvement projects. Through March, casinos have contributed over $5 billion to the ETF since opening in 2010.
Gov. Wes Moore’s budget for the upcoming Fiscal Year 2024 includes $8.8 billion toward education, up 10% from FY23. This money is separate from the Blueprint fund, though $500 million of it does support the Blueprint.
According to Moore, “Education is central to fighting poverty and powering the Maryland economy.”
