Lottery and Gaming agency reports steady revenues, recommends concurrence with governor and fields questions on sports wagering and iGaming
February 19, 2024 | Public Safety, Transportation, and Environment Subcommittee, Budget and Taxation Committee, SENATE, SENATE, Committees, Legislative, Maryland
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A Department of Legislative Services analyst presented the Maryland Lottery and Gaming Control Agency’s fiscal 2025 operating budget, reporting a modest $62,000 increase (0.1 percent) to a total of about $123.4 million and a $3.8 million proposed special fund deficiency to cover vendor fees.
DLS noted that 42 percent of the allowance covers central monitoring and control systems that account for lottery sales and video lottery terminal activity, while roughly 30 percent supports personnel. The analysis highlighted reduced retailer commissions enacted in the Budget Reconciliation and Financing Act of 2024 — agent sales commissions were cut from 6 percent to 5.5 percent and cashing commissions from 3 percent to 2 percent — and estimated resulting general fund revenue increases of $2.2 million in FY24 and $27.2 million in FY25.
John Martin, director of the Lottery and Gaming Control Agency, summarized FY23 revenues and agency priorities: the agency contributed nearly $1.6 billion to state causes across lotteries, casinos and sports wagering; it has intensified responsible‑gaming initiatives in partnership with the National Council on Problem Gambling and the University of Maryland Center of Excellence on Problem Gambling; and the agency has reduced vacancy rates to under 3 percent.
Committee members asked why some agency functions were supported with general fund dollars and whether sports wagering will sustain regulatory costs. Agency staff said lottery operations are funded by special funds, gaming by a mix of special and general funds (noting limited allocations for table games and the timing of sports wagering licensing revenues), and that sports wagering underwriting of agency costs will change over a multi‑year renewal cycle.
On iGaming, DLS described a November 2023 contracted study that estimated Maryland’s market potential at more than $900 million in gross revenue and predicted a roughly 4–8 percent job‑loss range for land‑based casinos under certain scenarios; the study included mitigation options such as studio operations and other incentives to retain customers. The subcommittee requested continued monthly reporting on sports wagering trends and further discussion on funding choices for agency operations.
DLS noted that 42 percent of the allowance covers central monitoring and control systems that account for lottery sales and video lottery terminal activity, while roughly 30 percent supports personnel. The analysis highlighted reduced retailer commissions enacted in the Budget Reconciliation and Financing Act of 2024 — agent sales commissions were cut from 6 percent to 5.5 percent and cashing commissions from 3 percent to 2 percent — and estimated resulting general fund revenue increases of $2.2 million in FY24 and $27.2 million in FY25.
John Martin, director of the Lottery and Gaming Control Agency, summarized FY23 revenues and agency priorities: the agency contributed nearly $1.6 billion to state causes across lotteries, casinos and sports wagering; it has intensified responsible‑gaming initiatives in partnership with the National Council on Problem Gambling and the University of Maryland Center of Excellence on Problem Gambling; and the agency has reduced vacancy rates to under 3 percent.
Committee members asked why some agency functions were supported with general fund dollars and whether sports wagering will sustain regulatory costs. Agency staff said lottery operations are funded by special funds, gaming by a mix of special and general funds (noting limited allocations for table games and the timing of sports wagering licensing revenues), and that sports wagering underwriting of agency costs will change over a multi‑year renewal cycle.
On iGaming, DLS described a November 2023 contracted study that estimated Maryland’s market potential at more than $900 million in gross revenue and predicted a roughly 4–8 percent job‑loss range for land‑based casinos under certain scenarios; the study included mitigation options such as studio operations and other incentives to retain customers. The subcommittee requested continued monthly reporting on sports wagering trends and further discussion on funding choices for agency operations.
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