Maryland igaming bill withdrawn from legislature
A bid to bring online casino gambling to Maryland stalled after the referendum measure tied to the effort was withdrawn, leaving the remaining bill without a workable route in Maryland’s General Assembly.
Sen. Ron Watson pulled Senate Bill 761 on 13 March. The bill had sought to place the issue before voters on Election Day. Its companion, Senate Bill 885, technically stayed alive, but it could not operate on its own.
Maryland lawmakers weighed the proposal as they worked through a US$1.5 billion budget shortfall. A legislative analysis said igaming could generate US$1.3 billion after about six years.
A House Ways and Means Committee member said he did not expect the legislation to advance. “I feel pretty confident there’s not an appetite for it this year,” Del. Wayne Hartman told the OC Today-Dispatch. “My concern is, really, next year, after the election, when our deficit continues to grow, what are we going to see to quench the thirst of the majority party here to spend money?”
The measure had proposed allowing Maryland’s six licensed casinos to obtain mobile gaming licenses for games such as poker, blackjack, roulette, and baccarat. It also had allowed those licenses to be leased to platforms such as DraftKings or FanDuel.
Opposition came from Worcester County, the home of Ocean Downs Casino. Local leaders had argued that the expansion of igaming would reduce the economic benefits casinos brought to their communities.
Charlotte Capewell brings her passion for storytelling and expertise in writing, researching, and the gambling industry to every article she writes. Her specialties include the US gambling industry, regulator legislation, igaming, and more.
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The Backstory
Why the push for online casinos hit a wall
Maryland’s bid to send online casino gambling to voters collapsed because the referendum measure underpinning the plan was pulled late in the session. The retreat followed weeks of caution from rank-and-file lawmakers that the votes were not there. One member of the House Ways and Means Committee signaled as much early, saying there was little appetite to advance the issue while the state wrestled with a sizable budget gap. He also warned in local media that the debate could return after elections, a sentiment echoed in not likely to pass this session comments from Del. Wayne Hartman. The bill envisioned a tightly controlled model that would have invited Maryland’s six licensees to extend their brands or partner with national platforms for poker, blackjack, roulette and baccarat.
The proposal’s fiscal hook was significant. Lawmakers were told online casinos could build to more than a billion dollars in annual gross revenue over several years, with taxes easing a multiyear budget shortfall. But the politics of timing and local pushback — especially from Worcester County officials concerned about brick-and-mortar erosion at Ocean Downs — ultimately undercut momentum. Without the referendum vehicle, the companion bill lacked a viable path through both chambers before adjournment.
Taxes over expansion became the budget play
The legislative chill on expansion did not occur in a vacuum. The governor opened the year by putting tax increases on the table, a move that reshaped what gaming policy could plausibly deliver this session. Analysts said the plan’s centerpiece would double the tax rate on online sports betting and raise the levy on casino table games, jolting investor expectations. A detailed breakdown of the proposal’s market impact is in Analyst: Maryland tax hikes would “rattle online sports betting sector”, which highlighted how the package reframed the conversation from new products to higher yield on existing ones.
Wall Street notes captured the tension: digital operators could absorb higher rates, but the pivot away from iGaming disappointed those betting on faster legalization. One analyst argued that while tax hikes do not require voter approval, they risk dampening investment and marketing spend, with knock-on effects for growth. Another floated that raising rates now could be a down payment on future iGaming talks, though that theory ran headlong into committee realities as the session progressed.
The stakes are straightforward. If Maryland prioritizes near-term revenue through taxes, expansion becomes a longer game. If it reopens expansion later, the tax baseline and operator appetite will be different from what lawmakers assumed at the start of the year.
Enforcement pressure rose on gray-market sweepstakes
Parallel pressure came from regulators. As lawmakers debated what should be legal, the Maryland Lottery and Gaming Control Agency stepped up enforcement against unlicensed sweepstakes and offshore-style operators. In January, the agency disclosed it had sent 11 cease-and-desist letters and was preparing follow-ups to payment processors after limited compliance. That crackdown is detailed in Maryland regulator sends cease-and-desist letters to sweepstakes platforms.
This posture matters for two reasons. First, it undercuts the argument that Maryland can tolerate a gray market while the legislature deliberates on regulated alternatives. Second, it highlights consumer protection and problem gambling concerns that have become central to every gaming debate. Tightening the screws on illegal products often strengthens the case for a regulated channel, but it can just as easily harden opposition to rapid expansion if stakeholders see enforcement as the cleaner near-term fix.
Fantasy sports became a policy bridge
While full online casinos stalled, lawmakers moved to clarify and expand daily fantasy sports, positioning the space as a lower-stakes arena for consumer protections and definitions. A pair of Maryland bills would revise what counts as a fantasy competition to include both peer-to-peer and against-the-house games, while adding a statewide voluntary exclusion program. That effort is captured in Illinois and Maryland consider legalization of DFS contests, with bill text and tracking available for Maryland Senate Bill 470 and its House companion House Bill 484.
The DFS pivot is not unique to Maryland. Illinois lawmakers advanced a comprehensive framework to license and tax fantasy contests, part of a broader rebalancing between fantasy products and traditional sportsbooks as business models converge. The Illinois measure, which sets taxes and licensing terms and explicitly authorizes against-the-house fantasy, can be tracked via Illinois SB 1224 on LegiScan. For Maryland, sharpening lines around fantasy could ease frictions with regulators and provide a template for consumer protections that might carry into any future iGaming push.
Sports betting’s growth sharpened the revenue debate
Sports betting continues to scale, a trend that both supports and complicates arguments for new gaming products. In February, Maryland’s online sportsbooks posted a year-over-year increase in handle and a bigger jump in taxable wins. The latest performance snapshot is in Maryland online sportsbooks generate $463.1 million in wagers in February, which notes that mobile remains dominant and tax receipts flow to education and problem gambling funds.
Those numbers illustrate the core trade-off. Stronger sports betting yields bolster the case for higher tax rates rather than new categories. But they also show how quickly regulated markets mature when products are accessible on phones and backed by national brands. Proponents of iGaming argue that channel shift is already happening through unregulated sites and social casinos; opponents say the state can wring more from what it has, then reassess after fiscal pressures ease.
Innovation elsewhere raised new questions for lawmakers
Maryland’s debate unfolded as other states tested novel channels and partnerships, underscoring how product design collides with public health concerns. In Connecticut, a bill was filed to allow in-flight sports wagering tied to departures and arrivals in state. That unexpected frontier — which aligns operator tech with an airline ecosystem — is covered in In-flight sports betting bill introduced to Connecticut Legislature. The proposal followed a headline partnership between a leading sportsbook and a major carrier and drew quick scrutiny from a U.S. senator focused on problem gambling risks.
For Maryland policymakers, these outside experiments are cautionary and instructive. They show how quickly offerings can migrate into daily routines, and how regulatory guardrails often trail innovation. That dynamic helped frame this session: better to clarify fantasy rules and police gray markets now, some lawmakers argued, than to bolt a new casino vertical onto a system still calibrating tax rates, consumer protections and enforcement capacity.
The upshot is a pause, not an endpoint. Between stepped-up enforcement, a live tax debate and incremental moves on fantasy, the architecture for a broader digital gaming framework is taking shape. Whether that translates into a ballot question in a future session will hinge on the same forces that defined this one — budget math, consumer protection politics and how the market evolves without a legal online casino option.
