Maryland Casinos looking to lower Slots Payback by 5%

Maryland Casinos looking to lower Slots Payback by 5%

Maryland’s five casinos have asked the state Lottery and Gaming Control Agency to let them lower payback so that they can pull more profits from customers. If approved, this decision could potentially give the Free State’s casinos tens of millions of dollars in extra annual revenue.

Currently, Maryland slots must pay out between 90 and 95 percent over the course of a year. But the new proposal would lower this amount to 85 percent payback, thus giving casinos more money and players less winnings.

“The patrons would end up receiving less,” said Charles LaBoy, the state’s assistant director for gaming. He continued telling the Baltimore Sun that the “flip side is that the hold would increase. So there is a potential revenue upside to the state on this.”

Laboy didn’t give an exact dollar amount on how much potential revenue he thinks this deal is worth. However, it’s estimated that the amount could reach eight figures every year.

The state’s five casinos have earned $622 million through slot machines in the first 11 months of the fiscal year. Casino operators received $229 million of this, while another $290 million went to Maryland’s Education Trust Fund.

The problem with dropping slots payback to help Maryland casinos and the state education fund receive more money is local competition. The Free State is in one of the most competitive gaming markets in the U.S. Going further, their 90-95 percent slots payback is in line with what neighboring states are offering. So if they drop down to an average of 85 percent, casino patrons could be encouraged to visit other states instead.

Matthew Heiskell, general manager of Hollywood Casino Perryville, mentioned this point to the Baltimore Sun. “Like any place, we’re going to have a large mixture,” Heiskell said. “You want people to know they can win at your place.”

According to the American Casino Guide, Maryland slots paid an average of 90.38% from July 2013 to June 2014, which puts them in the middle of the pack. Delaware (92.23%), Ohio (91.62%) and New Jersey (91.01%) all rank ahead of them, while New Jersey (90.01%) and West Virginia (89.86%) both rank behind Maryland regarding payback.

This being said, it’ll be interesting to see if the Lottery and Gaming Control Agency risks turning off customers to lower slots payback almost 5% more than the current lowest state.