Sports Betting

Two Sports Betting Bills Active in Maine Legislature

As legalized sports betting continues to expand across the United States, lawmakers in Maine are looking to help their state cash in as well. Two bills have been introduced in the Maine House of Representatives with differing ideas on how to structure regulated sports wagering in the state.

Main State StampLD 1348 – Higher Tax, Online Betting Permitted

The first bill is Legislative Document 1348, introduced on March 21st by Rep. Jeffrey Evangelos (I – Friendship). It would set the legal sports gambling age at 21 years old and would permit widespread betting. Casinos, racetracks, off-track betting venues, and online sports betting are all on the table. The licensing fee per operator would be $30,000 and the tax would be quite high, at 25 percent of net sports wagering income. Nearly all of that tax would be earmarked for the Maine Department of Education “to be used for essential programs and services for kindergarten to grade 12.”

A small amount – equal to one percent of net sports wagering income – would be used for administrative expenses.

“It is pretty obvious why we are doing it,” said Rep. Evangelos told the Portland Press Herald. “It is fun and everyone else is doing it. Why shouldn’t we get a piece of it, too?”

That’s a surprisingly honest assessment, particularly the part about it being fun. While a major goal is to fund education and Evangelos doesn’t want his state to get left behind, I appreciate that he is acknowledging that, hell yeah, sports betting can be a blast, so why not let people do it.

Obviously, a reason to not let people do it is because gambling can come with its own set of problems, like addiction. Needless to say, this is a concern for some lawmakers. (Really, it’s a concern for everyone, but some people use it as the non-negotiable reason to not legalize sports betting or gambling, in general.)

“Anytime we expand gambling we have to consider the negative effects. That always becomes part of the equation,” state Senator Louis Luchini (D-Ellsworth) told the Press Herald. Sen. Luchini is the co-chairman of the Veterans and Legal Affairs Committee, the committee in which the bill currently sits. Luchini is in the process of penning his own sports betting bill.

“Gambling bills are always controversial,” he said. “It is something you have to take the time and meet with all the parties and hash out something responsible.”

LD 1515 – Lower Taxes, Brick-and-Mortar

The other bill, LD 1515, was introduced last week by Rep. Dustin White (R-Washburn). His bill is very different. It lowers the sports betting age to 18 but would not permit online sports wagering. Sports betting would be limited to in-person locations such as off-track betting shops and harness racetracks. The cost to operators would also be much lower: a $5,000 licensing fee and a tax rate of 18 percent.

The tax revenue would be split up into much smaller pieces than in Rep. Evangelos’ bill. Two percent would go to the Maine Community College System to fund scholarships, one percent would be used for administrative expenses, five percent would go to the state’s Native American tribes, and then two percent each would go to kindergarten through twelfth grade programs, the Agricultural Fair Support Fund, a fund to supplement harness racing purses, the Fund to Encourage Racing at Maine’s Commercial Tracks, and the Fund to Stabilize Off-track Betting Facilities.

So LD 1515 would open up sports betting to a wider range of people, as the legal betting age is lower than in LD 1348, but the avenues for wagering are much more restrictive, so the potential market will likely be smaller.

LD 1348 also tabs a significantly greater portion of funds to education, while LD 1515 uses some of the tax revenue to prop up the state’s racing industry.

“We’ve had casinos for many, many years now. Gambling isn’t anything new to the state of Maine,” White told the Press Herald. “I think people are more open to sports betting than they have been in the last year. Looking at the national attention, it is just going to trickle up to Maine. I’d rather be the first in New England.”

The higher tax rate in Rep. Evangelos’ bill could be a real problem. Sportsbooks make very small margins, so even the slightest uptick in expenses can really hurt.

“I think it is important to note that revenue numbers in sports betting are incredibly small, about 1 to 2 percent of every property,” said vice president of communications for Penn National Gaming Jeff Morris.

The gap between a 25 percent tax and an 18 percent tax is a sizeable one. And even then, both tax rates are higher than in other states that have legalized sports betting, except for Pennsylvania.

There is another sports betting bill in the Maine Senate, SB 553, but it is just a placeholder bill, introduced in January, with no content of any note.

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