A coalition of Maryland off-track wagering facilities is pushing for legislation that would allow up to 4,000 historical horse racing terminals to be deployed in the state. The bill, SB 982, is sponsored by Sen. Paul Corderman and aims to help struggling OTBs by potentially increasing revenue through HHR machines. The Department of Legislative Services estimates that HHR could generate over $188 million in revenue annually, which would be taxed at a lower rate than slot machine revenue.
While the legislation could benefit OTBs, it may negatively impact the racing industry by potentially cannibalizing slot machine revenue that currently supports purses, breeder awards, and capital investment. The bill does not include a carve-out for racing industry funding as slot machines currently do. Advocates believe that expanding the definition of sporting events to include historical horse races could help avoid a lengthy and expensive referendum process typically required for commercial gaming expansion.
Opposition to the bill comes from the casino industry, which argues that the increase in HHR terminals would significantly impact the number of slot machines in Maryland and the tax rate on revenue. The bill would tax HHR as a form of sports betting at a lower rate than slot machines, which could have financial implications for various recipients of slot revenue, including local communities and small businesses. The companion bill in the House of Delegates is HB 1048.
