Sports Betting Commission adds diversity requirement for applicants to receive mobile sports betting licenses

The Legislature pushed for fairness in the sports betting industry when it approved the legislation last year, particularly because majority white businesses were given licenses when the medical cannabis industry in the State was launched almost five years ago. Photo by Danielle E. Gaines.

The Maryland Sports Betting Application Review Commission on Friday unanimously approved an amendment to the policy that requires companies that have obtained a mobile betting license in Maryland to subsequently submit a diversity plan.

The plan, submitted to the commission known as SWARC within 30 days of clearance approval, must include strategies for obtaining a diverse group of owners or contractors, organizing diversity-related events and propose timelines and benchmarks for achieving diversity objectives.

An applicant must also check “yes” to three boxes that summarize that they will make a “good faith effort” to achieve diversity goals, communicate diversity measures to the Maryland Lottery and Gaming Control Commission, and put their diversity plan available to the public.

“SWARC will consider any type of diverse group where an applicant can demonstrate that an individual has been disadvantaged and therefore the inclusion of the individual as a participant in the diversity plan would be beneficial,” according to the addendum.

A member of the commission asked what would happen if a diversity plan was flawed.

“There is no possibility of cancellation of the license. The license has been granted,” Assistant Attorney General David Stamper said.

James Butler, general manager of organizational compliance for the state’s Lottery & Gaming Control Agency, said the agency and commission will work with a candidate “to take corrective action” to ensure applications meet standards. of diversity.

Of the. Darryl Barnes (D-Prince George’s), who chairs Maryland’s Black Legislative Caucus, said he remains pleased with SWARC’s efforts to ensure fairness and inclusion are part of the process. Maryland is considered a leading state in the nation that is pushing minority and women-owned businesses to participate in the sports betting industry.

However, Barnes said the approval process could be improved by considering both the application and the diversity plan.

“It’s something we can work towards,” he said. “When this application or this plan is submitted, it should and must have this equity partner already listed, what is the intention and how [an applicant is] go ahead and put it together.

The Legislature pushed for fairness in the sports betting industry when it approved the legislation last year, particularly after predominantly white companies received licenses when the medical cannabis industry was launched in Maryland nearly five years ago.

The law also aims to ensure that entrepreneurs in Maryland have a fair chance to compete against large betting companies such as FanDuel and Draft Kings.

In the meantime, the state has released draft regulations for the competitive licensing of additional gambling venues and mobile sports betting licenses.

A section on economic impact notes that the impact would benefit small businesses, especially those certified in the state’s Minority Business Enterprise Program.

“MBE participation for contractors and suppliers who provide support to the licensee and sports betting operator could also be significant,” according to the proposal. “Once these small businesses are either licensed, certified, or registered with the Maryland Lotteries and Gaming Control Board, it gives them the opportunity to offer their goods and services to other licensees and operators of ‘sports betting facilities and mobile sports betting licensees.’

On Friday, the General Assembly’s Joint Committee on Administrative, Executive and Legislative Review voted to approve the settlement.

“When the MGA embraced sports betting, it did so in an effort to promote diversity in the industry,” Senate Speaker Bill Ferguson (D-Baltimore City) and House Speaker Adrienne said Friday. A. Jones (D-Baltimore County). . “The regulations approved today by the AELR that require sports betting license applicants to seek minority investors, use the state-recognized minority commercial enterprise program in contracting, and submit a substantial diversity plan will help achieve this goal. We are confident that these measures will ensure meaningful minority participation in this new industry. »

The commission will hold a public hearing on the regulations next Friday in Baltimore.

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