Industry shooting for rollout to the public by fall, with considerable participation by minority, woman-owned businesses

By Mark R. Smith, US Correspondent for SiGMA

Maryland lawmakers ended the 2021 legislative session on April 12 by passing House Bill 940, which gave the state’s already approved sports gaming industry the infrastructure it needs to move toward opening.

It is anticipated that the bill will be signed shortly by Gov. Larry Hogan.

The passage of the law will permit the opening of up to 30 retail sportsbooks between casinos, professional sports stadiums, small businesses and scores of other entities and organizations, as well as up to 60 online operators; all told, the licences will be divided into five categories of operators. Key to the new parameters was the inclusion of small, minority-owned and women-owned businesses in the mix.

As the new industry with an estimated economic punch of approximately $120 million ramps up, industry executives are hoping Maryland’s brick-and-mortar and online sportsbooks will be up and running by this fall for the start of the football season.

The passing of HB 940 came after Maryland voters supported a 2020 ballot measure by a two-to-one count that amended the state constitution to permit legal sports wagering. Ensuring that ample minority participation “was the hold-up, and the holdup came from a good place,” said Jeff Ifrah (seen top left), founding member of Ifrah Law, in Washington, D.C.

“Maryland is the first state to be super-successful with this concept,” said Ifrah. “No state had made minority involvement such a priority that the legislature was unable to move forward without support for the minority businesses. The minority caucus in [the state capital of] Annapolis was responsible.”

The gaming industry is viewed as extremely lucrative, “but is primarily run by companies from other states,” he said, “so the question in Maryland was, “Do we want our residents to participate? D.C. said yes and Virginia did, too.”

But the real issue “is finding minorities’ meaningful participation and working them into the state ecosystem as critical providers. The whole issue is worthy of more study,” Ifrah said.

“Why not establish diversity goals for the incoming businesses, like having them hire a certain number of minority employees or setting up a minority subcontracting plan? The federal government does that all the time.”

Sen. Craig Zucker concurs. The Democratic Senator from District 14 and lead sponsor of the bill thinks Maryland is “leading the nation in terms of not only creating in-state competition for small, minority and women-owned businesses that would otherwise not be able to get into the market, but is also keeping pace with neighbouring states that already have sports betting.”

Zucker is also looking forward to the $17 million-$19 million that state’s sports betting will generate for the Blueprint for Maryland’s Future Fund, which has been set up to boost the state’s educational system in such areas as early childhood education, and college and career readiness, among others.

But around the country, the approval of Maryland’s HB 940 will probably be most notable for “the General Assembly’s intent to maximize the ability of people of colour and women to more fully participate in the sports wagering industry,” said Maryland Speaker of the House Adrienne Jones, “including through ownership and providing services to licensees.”

In addition to the volume of sports wagering facility and mobile licenses, said Jones, a portion of licensing fees will be used to provide grants to small, minority-owned and women-owned businesses to assist them in applying for licenses and for targeted training.

The dictum will also trickle down, for instance, to the state’s Historically Black Colleges and Universities, which “will be a central part of the process through the creation of programs to study data analytics and sports gaming so that Maryland students, of all backgrounds, have an opportunity to work in this industry.

“As a result,” said Jones, “Maryland’s sports wagering industry will be one of the most diverse in the nation.”

To gain a broader perspective on what’s happening across the US gaming landscape, SiGMA recently held the second leg of its virtual, monthly Roadshow conference in Las Vegas.? It will revisit the US later on in the year with another expo – this time centred around New Jersey. View the SiGMA Roadshow calendar of events for more information.

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