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Online sports wagering nears reality in Maryland

A state commission has awarded the first 10 sports gaming licenses, clearing the way for the first online wagers to be taken, possibly by the end of the month.

The approvals issued by Maryland’s Sports Wagering Application Commission represent just under half of the total number of applications submitted for mobile licenses.

UPDATE: Md. regulators say mobile sports wagering can start next week

“Mobile will account for the bulk of the revenue from sports wagering, and we’re eager to enable Maryland to enter that market,” said Thomas Brandt, chairman of the review panel. “The language of the law which created SWARC has been challenging, and our commission has taken seriously its intent to enable diverse participation in this new industry.”

Brandt attributed the lengthy process to an in-depth review by the commission, which he compared to the carpentry adage “measure twice, cut once.”

Included in the initial wave of approvals Wednesday are four casinos: Horseshoe Casino in Baltimore; Hollywood Casino in Perryville; Maryland Live in Hanover; and MGM in National Harbor.

Three off-track-betting venues — Greenmount Station in Hampstead; Long Shots in Frederick; and the Riverboat on the Potomac in southern Maryland — were qualified for mobile licenses.

Two other venues — Brooklyn Park-based Bingo World and the Maryland State Fairgrounds in Timonium — were also qualified for licenses.

The commission also awarded a license to a company owned by Washington Commanders owner Daniel Snyder. That license and another for a physical sports book are tied to FedEx Field, home of the NFL franchise.

All 10 licensees were part of a group of more than a dozen guaranteed licenses for brick-and-mortar sports betting parlors.

In all, 21 applications were filed for 60 mobile licenses. Eleven of those applicants await initial qualification by state gaming regulators and the Maryland Lottery and Gaming Commission.

The state also received six applications for physical sports betting parlors. Those licensees must also be qualified by lottery and gaming officials before the application review commission can review and possibly award the licenses.

The licenses awarded today by the commission open the door to the possibility of the first online sports bets to be placed by the end of the month. All the awardees must complete some final regulatory hurdles, including submission of diversity plans within the next 30 days as well as reviews of their betting systems in demonstration runs.

The mobile licenses are expected to be the most lucrative in the state’s sports wagering industry.

Even so, most companies are projected to lose money in their first year of operation in the state.

Meanwhile, the state expects to receive about $26 million in tax revenue the first year. That grows incrementally to about $100 million projected for the fifth year.

“It’s taken us a while to reach this point,” said Brandt.

Gov. Larry Hogan, who had been often critical of the delays in approving mobile sports betting, applauded the approvals.

“To reach this point, we have had to overcome countless legal, political, and bureaucratic delays that threatened to push back the launch past the Super Bowl next year,” said Hogan in a statement. “It was completely unacceptable to me, and we spent months pressing for decisive action. Thanks to those efforts, and after repeated interventions by our administration, we now anticipate the launch of mobile sports betting this month, and we are cautiously optimistic that it will be in time for Thanksgiving.”

In part, the delays were the result of a complicated state law that required a focus on ensuring a diverse ownership of licenses. Included in those requirements was an industry study some hoped would lead to regulations ensuring Black and women ownership.

Instead, the study resulted in regulations with less explicit language. The rules called for licensees to have diversity plans and a minority ownership of at least 5%. The individuals making up the minority ownership could not exceed certain personal wealth caps.

Some ownership groups had unique takes on reaching that required 5%. The license awarded to Live Casino includes a 10% stake offered to 90 upper management employees in The Cordish Cos. casino group. Of those, 86 employees, equaling about more than 7% of the ownership, satisfy the personal wealth limits.

Brandt said the plan was “very impressive to bring a lot of people, meaningfully, into the new industry.”

Riverboat on the Potomac, which has four minority owners, and Long Shots, which is owned by a woman, are the only two groups that met the initial vision of a diverse licensee pool.

“I think we certainly met the charge of the legislature,” said former Del. Frank Turner, who is a member of the review panel.

 


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