Not all Maryland casinos are on board with the state legalizing iGaming.
At the end of February, representatives of Ocean Downs Casino & Racetrack and Live! Casino spoke before the House Ways and Means Committee to express their desire to keep online casinos illegal in the state.
Their arguments centered around a fear of job losses stemming from potential cannibalism if Maryland online casinos are legalized.
On the flip side, MGM National Harbor, Horseshoe Baltimore, Hollywood Casino Perryville, and Rocky Gap Casino support iGaming legislation.
Ocean Downs GM says iGaming would take away jobs at retail casinos
Ocean Downs Casino & Racetrack General Manager Bobbi Jones told the committee on March 4 that she’s proud to both live and work locally in her Maryland community along with the 350 residents the casino employs. But she’s concerned that online casino gambling could result in fewer employment opportunities going forward.
“This will impact our team members that will cause a loss of good-paying jobs year-round, health benefits and retirement benefits.”
A recent study disputes her claim.
Jones said iGaming would cut into casino revenue, which in turn would result in fewer taxes for the state.
Currently, Maryland taxes casino revenue at 20%. The majority of casino revenue tax dollars go toward the Education Trust Fund. The remaining tax money goes to Local Aid.
Jones said fewer casino customers would adversely impact local businesses.
“iGaming will negatively impact the state and our local community with a loss of tax revenue from reduced gaming revenue, reduced payroll, reduced sales tax revenue and reduced contributions to our county and surrounding counties. iGaming will reduce the spending of goods and services, along with marketing spending, which can and will impact minority-owned businesses throughout the state.”
She also told lawmakers that she believes online casino gambling would cause Ocean Downs to quit investing in its facility.
Live! Casino spokesperson says iGaming ‘a bad deal for Maryland’
Live! Casino Maryland had two speakers come to the stand on its behalf.
Mark Stewart, executive vice president and general counsel of The Cordish Companies, said he “certainly understands” the desire for online casino gaming.
Echoing Jones, Stewart said iGaming is a poor deal for the communities and Live! Casino’s employees. He speculated that “thousands” of casino workers would lose their jobs if iGaming becomes legal in Maryland.
“We genuinely believe iGaming is a bad deal for Maryland, our employees and our communities. There’s little dispute that iGaming will cause substantial job loss – The Innovation Group acknowledged it. Thousands of people in Maryland will lose their jobs, the jobs they count on to support their families. Even more families could be impacted by the tightening of wages and reduced benefits. These are negative impacts that will be sorely felt by a diverse workforce, and many of the jobs that will disappear are accessible to people with a high school diploma or less.”
Stewart referred to a study from The Innovation Group, which claimed that brick-and-mortar casinos would lose 10% of their revenue to iGaming.
“The real-life impact of mobile sports betting on brick-and-mortar was more than six times that figure. If you look at iGaming states and black out the new casinos that opened over the period of 2019-2022, brick-and-mortar lost 23% due to iGaming.”
Stewart told lawmakers that if Maryland legalizes online casino gambling, retail operations will adapt.
“If iGaming passes, we’re a gaming company – we’ll do well financially. But despite our potential financial gain, we are asking you not to do iGaming, and that should speak volumes.”
Another Live! representative brings up study on iGaming addiction
Rob Garagiola with Compass Advocacy told House committee members that there are “a lot of data points” to consider.
Garagiola highlighted a report from Morgan State University, which found that iGaming “is one of the most addicting activities available.” The report also found that iGaming addiction is three times higher than brick-and-mortar casino gambling addiction.
Then, Garagiola touched on job security, likening a drop in retail casino traffic as a result of iGaming to the downfall of brick-and-mortar shopping businesses.
“How many businesses have closed due to online shopping? JC Penny’s, Toys R Us, Bed Bath & Beyond – there are hundreds of businesses across the country that have closed their doors. That will happen with respect to gambling in the casinos and the brick-and-mortar jobs in the state of Maryland. You can’t say it won’t happen. It will happen, but to what degree?”
Garagiola argued that Maryland’s tax revenue stream could be impacted by legalized iGaming. He said that casinos have increased their funding to the state’s education programs over the course of the last few years.
Specifically, funding has jumped 55% over the last seven years from brick-and-mortar casinos. It’s jumped 25% over the last five, Garagiola said.
“If we just maintain what we’re doing with the brick-and-mortar casinos, we’ll have more education trust and revenue (funding) in the next five to seven years than we would under this (iGaming) bill.”
Casino employees concerned about jobs
Several casino employees, both operators in favor of iGaming and those opposed, spoke out against House Bill 1319 at the Ways and Means Committee hearing.
The main reason was job security. Those who spoke feared that online casino gambling would reduce traffic into brick-and-mortar casinos, leading to less revenue and job cuts.
Mark Joseph, a poker dealer at Live! Casino said he enjoys stability in his job, especially considering he cares for his mother. Because he’s been working at the casino only since 2018, he thinks he’d be one of the first on the chopping block.
“With limited turnover in poker, my seniority is relatively low. That means if iGaming is approved, most likely I will be laid off.”
An employee at MGM National Harbor agreed with Joseph.
“This bill will be a job-killer for casino workers like myself.”
Heidi Zimmerman, a bartender at Horseshoe Casino for the last nine years, told lawmakers that 80% or more of her income comes from tips.
“This is also true for thousands of other tip workers at Maryland casinos: the slot attendants, the dealers, the cage cashiers and all the food and beverage servers. The math is easy. There is no disagreement that iGaming will cause a reduction of foot traffic at the casinos. Less customers means less people to serve, which equals less tips, which means less income for casino workers and less jobs.”
