EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
Italics indicate opposite chamber/conference committee amendments.
*hb0328*
HOUSE BILL 328
C7 (5lr1242)
ENROLLED BILL
— Ways and Means/Budget and Taxation —
Introduced by Delegate Ebersole Delegates Ebersole, Griffith, and Vogel
Read and Examined by Proofreaders:
_______________________________________________
Proofreader.
_______________________________________________
Proofreader.
Sealed with the Great Seal and presented to the Governor, for his approval this
_______ day of _______________ at ________________________ o’clock, ________M.
______________________________________________
Speaker.
CHAPTER ______
AN ACT concerning 1
State Lottery – Instant Ticket Lottery Machines – Veterans’ and Fraternal 2
Organizations 3
FOR the purpose of authorizing the Director of the State Lottery and Gaming Control 4
Agency to issue certain fraternal organizations a license for not more than a certain 5
number of instant ticket lottery machines; altering the distribution of proceeds from 6
certain instant ticket lottery machine sales by veterans’ organizations; providing for 7
the distribution of proceeds from certain instant ticket lottery machine sales by 8
fraternal organizations; authorizing, instead of requiring, the Director to consider 9
certain information before issuing certain licenses; repealing a requirement that 10
certain veterans’ organizations purchase or lease certain instant ticket lottery 11
machines; prohibiting certain fraternal organizations from operating an instant 12
ticket lottery machine in certain locations; altering certain requirements concerning 13
the conduct of gaming through instant ticket lottery machines; and generally 14
relating to the operation of instant ticket lottery machines in the State. 15 2 HOUSE BILL 328
BY repealing and reenacting, with amendments, 1
Article – State Government 2
Section 9–112 3
Annotated Code of Maryland 4
(2021 Replacement Volume and 2024 Supplement) 5
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 6
That the Laws of Maryland read as follows: 7
Article – State Government 8
9–112. 9
(a) (1) In this section[, “veterans’] THE FOLLOWING WORDS HAVE THE 10
MEANINGS INDICATED . 11
(2) “ACTIVE MEMBERS ” MEANS INDIVIDUALS WH O ARE RECOGNIZED 12
BY A FRATERNAL ORGAN IZATION AS DUES –PAYING MEMBERS OR LI FETIME 13
MEMBERS. 14
(3) (I) “FRATERNAL ORGANIZATIO N” MEANS A NONPROFIT 15
ORGANIZATION THAT : 16
1. A. IS TAX EXEMPT AND OR GANIZED AS A 17
FRATERNAL OR SORORAL ORGANIZATION UNDER § 501(C)(7) OR § 501(C)(8) OF THE 18
INTERNAL REVENUE CODE; 19
B. OWNS OR LEASES A PRO PERTY; AND 20
C. HAS A BONA FIDE MEMBERSHIP OF AT LEAST 300 21
ACTIVE MEMBERS OR HA S BEEN LOCATED IN A COUNTY IN WHICH SUBS ECTION (D) 22
OF THIS SECTION APPL IES FOR AT LEAST 5 YEARS BEFORE THE ORG ANIZATION 23
APPLIES FOR A LICENS E UNDER SUBSECTION (D) OF THIS SECTION; OR 24
2. IS INDEPENDENT AND THE MEMBE RSHIP OF WHICH 25
COMPRISES SOLELY GRA DUATE MEMBERS OF A N ATIONWIDE FRATERNITY OR 26
SORORITY THAT IS TAX EXEMPT UNDER § 501(C)(7) OR § 501(C)(8) OF THE 27
INTERNAL REVENUE CODE. 28
(II) “FRATERNAL ORGANIZATIO N” DOES NOT INCLUDE : 29
1. ANY COLLEGE OR HIGH SCHOOL FRATERNITY OR 30
SORORITY; OR 31
HOUSE BILL 328 3
2. ANY OTHER FRATERNITY OR SORORITY THE 1
MEMBERSHIP OF WHICH IS RESTRICTED IN WHO LE OR IN PART TO STU DENTS OR 2
GRADUATES OF AN EDUC ATIONAL INSTITUTION OR A PROFESSIONAL SC HOOL. 3
(4) “VETERANS’ organization” means an organization that is tax exempt 4
and organized as a veterans’ organization under § 501(c)(19) or § 501(c)(4) of the Internal 5
Revenue Code. 6
(b) Except as provided in subsection (d) of this section, in accordance with the 7
regulations of the Agency and this subtitle, the Director shall issue licenses to the persons 8
and governmental units that will best serve the public convenience and promote the sale of 9
State lottery tickets or shares. 10
(c) Before issuing a license to an applicant, the Director [shall] MAY consider 11
such factors as: 12
(1) the financial responsibility and security of the applicant and the 13
business or activity of the applicant; 14
(2) the accessibility of the place of business or activity to the public; 15
(3) the sufficiency of existing licenses to serve the public convenience; and 16
(4) the volume of expected sales. 17
(d) (1) This subsection does not apply in: 18
(i) Caroline County; 19
(ii) Cecil County; 20
(iii) Dorchester County; 21
(iv) Kent County; 22
(v) Queen Anne’s County; 23
(vi) Somerset County; 24
(vii) Talbot County; 25
(viii) Wicomico County; and 26
(ix) Worcester County. 27
4 HOUSE BILL 328
(2) (i) Subject to subparagraph (ii) of this paragraph, the Director may 1
issue a license under this subtitle for: 2
1. not more than five instant ticket lottery machines to an 3
applicant that is a veterans’ organization OR FRATERNAL ORGANIZ ATION; AND 4
2. NOT MORE THAN THREE INSTANT TICKET LOTTE RY 5
MACHINES TO AN APPLI CANT THAT IS A FRATE RNAL ORGANIZATION . 6
(ii) A veterans’ organization OR FRATERNAL ORGANIZ ATION that 7
is issued a license under this subsection shall locate and operate its instant ticket lottery 8
machines at its principal meeting hall in the county in which the veterans’ organization OR 9
FRATERNAL ORGA NIZATION is located. 10
(III) AS A RETAILER UNDER T HE INSTANT TICKET LO TTERY 11
MACHINE PROGRAM , A VETERANS’ ORGANIZATION OR FRAT ERNAL ORGANIZATION 12
SHALL BE COMPENSATED BASED ON A PERCENTAG E OF PROCEEDS . 13
(3) (I) After deduction of any [commission and] validation prize payout 14
as provided under § 9–117 of this subtitle, a veterans’ organization issued a license under 15
this subsection shall RETAIN 50% OF THE NET PROCEEDS AND credit the remaining 16
receipts NET PROCEEDS from the sale of tickets from instant ticket lottery machines to 17
the State Lottery Fund established under § 9–118 of this subtitle. 18
(II) ON A PROPERLY APPROVE D TRANSMITTAL , THE AGENCY 19
SHALL PAY THE FOLLOW ING AMOUNTS FROM THE NET PROCEEDS OF SALE S OF 20
TICKETS FROM INSTANT TICKET LOTTERY MACHI NES OPERATED BY A VE TERANS’ 21
ORGANIZATION : 22
1. 50% TO VETERANS ’ ORGANIZATIONS 5% TO THE 23
MARYLAND VETERANS TRUST FUND ESTABLISHED UNDE R § 9–913 OF THIS TITLE; 24
2. TO THE AGENCY, AN AMOUNT NECESSARY TO PAY FOR 25
THE PURCHASE OR LEASE OF THE INSTANT TICKE T LOTTERY MACHINES A ND 26
AGENCY ADMINISTRATION FEES FOR THE PROGRAM ; AND 27
3. ANY REMAINING AMOUNT TO THE EDUCATION TRUST 28
FUND ESTABLISHED UNDE R § 9–1A–30 OF THIS TITLE. 29
(III) AFTER DEDUCTION OF A VALIDATION PR IZE PAYOUT, A 30
FRATERNAL ORGANIZATI ON ISSUED A LICENSE UNDER THIS SUBSECTIO N SHALL 31
REMIT THE PROCEEDS F ROM THE SALE OF TICK ETS FROM INSTANT TIC KET LOTTERY 32
MACHINES: 33 HOUSE BILL 328 5
1. RETAIN 25% OF THE NET PROCEEDS FOR 1
UNDERGRADUATE , GRADUATE, OR TRADE SCHOOL SCHOLARSHIPS OR CAPI TAL 2
IMPROVEMENTS , CAPITAL OUTLAYS , ACQUISITIONS, OR EXISTING COMMUNIT Y 3
OUTREACH PROGRAMS AN D RESOURCES ; AND 4
2. REMIT THE REMAINDER TO THE AGENCY TO BE 5
DISTRIBUTED AS PROVI DED IN SUBPARAGRAPH (IV) OF THIS PARAGRAPH . 6
(IV) ON A PROPERLY APPROVED TRAN SMITTAL, THE AGENCY 7
SHALL PAY THE FOLLOW ING AMOUNTS FROM THE NET PROCEEDS OF SALE S OF 8
TICKETS FROM INSTANT TICKET LOTTERY MACHI NES OPERATED BY A FR ATERNAL 9
ORGANIZATION : 10
1. 20% TO THE HOMELESSNESS SOLUTIONS PROGRAM 11
IN THE DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT , TO BE USED, 12
IN CONSULTATION WITH THE DEPARTMENT OF VETERANS AND MILITARY 13
FAMILIES, TO ASSIST VETERANS A ND FAMILIES OF VETER ANS, WITH PRIORITY 14
GIVEN TO: 15
A. WOMEN VETERANS WHO A RE HOMELESS OR AT RI SK 16
OF HOMELESSNESS ; 17
B. SINGLE–PARENT VETERAN FAMIL IES; AND 18
C. VETERANS WHO ARE VIC TIMS OF DOMESTIC 19
VIOLENCE; AND 20
2. FROM THE REMAINING P ROCEEDS OF SALES OF 21
TICKETS FROM INSTANT TICKET LOTTERY MACHI NES OPERATED BY A FR ATERNAL 22
ORGANIZATION : 23
A. 25% TO THE FRATERNAL ORG ANIZATION TO BE USED 24
FOR UNDERGRADUATE , GRADUATE, OR TRADE SCHOOL SCHO LARSHIPS OR CAPITAL 25
IMPROVEMENTS , CAPITAL OUTLAY , ACQUISITIONS, OR EXISTING COMMUNIT Y 26
OUTREACH PROGRAMS AN D RESOURCES ; 27
2. 5% TO THE MARYLAND VETERANS TRUST FUND 28
ESTABLISHED UNDER § 9–913 OF THIS TITLE; 29
B. 3. TO THE AGENCY, AN AMOUNT NECESSARY TO PAY FOR 30
THE PURCHASE OR LEAS E OF THE INSTANT TIC KET LOTTERY MACHINES AND 31
AGENCY ADMINISTRATION FEES FOR THE PROGRAM ; AND 32
6 HOUSE BILL 328
C. 4. ANY REMAINING AMOUNT TO THE EDUCATION TRUST 1
FUND ESTABLISHED UNDE R § 9–1A–30 OF THIS TITLE. 2
(4) [(i) Subject to subparagraph (ii) of this paragraph, a veterans’ 3
organization issued a license under this subsection shall purchase or lease the instant 4
ticket lottery machines to be used by the veterans’ organization. 5
(ii)] An organization may not use receipts NET PROCEEDS from the 6
sale of tickets from instant ticket lottery machines that would otherwise be [credited to the 7
State Lottery Fund] DISTRIBUTED AS REQUI RED UNDER PARAGRAPH (3) OF THIS 8
SUBSECTION for the costs of purchasing or leasing instant ticket lottery machines. 9
(5) (I) The Director may adopt regulations to implement the provisions 10
of this subsection that include restricting the location of instant ticket lottery machines in 11
areas of a veterans’ organization’s OR A FRATERNAL ORGAN IZATION’S public meeting 12
hall that is accessible to the public. 13
(II) A FRATERNAL ORGANIZATI ON MAY NOT LOCATE OR 14
OPERATE ITS INSTANT TICKET LOTTERY MACHI NES IN A MEETING HAL L THAT IS: 15
1. LOCATED ON OR AFFILI ATED WITH THE CAMPUS OF 16
AN INSTITUTION OF HI GHER EDUCATION ; OR 17
2. LOCATED IN A BUILDIN G WHERE STUDENTS OF AN 18
INSTITUTION OF HIGHE R EDUCATION RESIDE . 19
(6) The Agency shall ensure that the element of chance in the conduct of 20
the gaming through the instant ticket lottery machines established under this subsection 21
is consistent with the holding in the case of Chesapeake Amusements Inc. v. Riddle, 363 22
Md. 16 (2001), in that the element of chance must be CONTAINED wholly within the 23
pre–printed PREDETERMINED instant lottery ticket, and that player enhancements in an 24
instant ticket lottery machine may not affect the element of chance being wholly within the 25
pre–printed instant lottery ticket. 26
(e) The Director may not issue a license to: 27
(1) a person or governmental unit to engage in business primarily as a 28
licensed agent; or 29
(2) an individual who is under the age of 21 years. 30
(f) The Commission may hear and decide an appeal of a denial of a license. 31
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 32
1, 2025. 33