Gov. Charlie Baker shocked many last week with an out-of-the-blue proposal to legalize sports betting in Massachusetts – with one of the prime sites for the proposed new wagering system to be at Encore Boston Harbor.
Baker said he plans to file the bill soon with the legislature, a bill that would allow betting on all professional sporting events – but not on college, amateur, high school or Esports events.
Baker has tagged all state revenues from sports betting to be allocated for local aid to cities and towns. The governor estimated that the system could be up by July 1, in time for the FY20 budget, and could generate another $35 million for the state’s cities and towns.
Encore Boston Harbor said it hadn’t reviewed Baker’s proposal, but it does support the expansion of gaming in Massachusetts to the sports betting arena. Wynn Resorts already has a very popular and long-standing sports book based in Las Vegas – where it has two in-person betting locations at two casinos.
“We’ve not yet had the opportunity to study the bill, and therefore cannot comment on the specifics of it,” said Michael Weaver, spokesman for Wynn Resorts. “However, we do support the concept and introduction of sports betting in the Commonwealth.”
State Rep. Dan Ryan said he agrees with sports betting in principle, but would like to take a closer look at Gov. Baker’s bill during the legislative session.
“I’d still have to see the details of sports betting legislation, but I support the concept,” he said. “For good or bad, this is the world we live in now. Technology has allowed activities that were historically banished to the underworld into the mainstream. Whether it’s casinos, marijuana or sports betting, society is bringing these things off the black market and taxing them. Thus far we haven’t fallen into an abyss. We need to take serious steps to protect vulnerable populations, our current legal gaming and the integrity of our professional sports product. But, I do believe there are ways to do this while deriving an entertainment tax from a wide swath of participants and not just a sin tax on the poor.”
Baker said on Thursday morning, Jan. 17, that sports betting is a natural progression in the evolution of the state’s gaming industry. The move also follows the legalization of sports betting in Rhode Island, where lines for wagering at Twin Rivers Casino – just over the state line – have been so long that betting has had to be cut off for the sake of time.
“Expanding Massachusetts’ developing gaming industry to include wagering on professional sports is an opportunity for Massachusetts to invest in local aid while remaining competitive with many other states pursuing similar regulations,” said Gov. Baker. “Our legislation puts forth a series of commonsense proposals to ensure potential licensees are thoroughly vetted and safeguards are in place to protect against problem gambling and illegal activity. We look forward to working with our colleagues in the Legislature to pass this bill into law.”
House Speaker Bob DeLeo said he is most concerned about protecting the integrity of the games.
“The first issue that has to be addressed is that the integrity of the game is protected,” he said. “That being said, an in-depth analysis of any legislation proposed is warranted. The House will review any sports betting proposal submitted by the governor.”
The MGC said it did not have a comment at this time on the news.
The administration’s proposal would authorize the MGC to issue newly-created sport wagering licenses to the current Category 1 resort casino licensees, which includes Encore and the MGM Springfield property. It would also be extended to the Category 2 licensee, which is Plainridge. A current gaming license would be required to operate an onsite sports wagering lounge.
The bill would also create an online presence too for those holding the new in-person sports betting license.
Holders of newly created gaming licenses would be able to provide sports wagering online, or contract with an entity to provide the service. Online sports pool operators would need to be licensed as a gaming vendor and the agreement would need to be approved by the MGC.
Separate from existing Category 1 and Category 2 licensees, the administration’s proposal also allows for unaffiliated entities to conduct online-only sports wagering. Online only operators would need to be fully qualified and licensed by the MGC as a sports wagering licensee under the current process set forth by the Expanded Gaming Statute.
To get in on the new licenses, a $100,000 application fee would be required under the proposal, and those approved for the license would pay a $500,000 licensing fee, which is renewable every five years.
The tax rate for in-person wagering would be 10 percent and online wagering would be at a higher, 12.5 percent, rate.
The revenue generated from renewals, in person and online wagering would exclusively go to the Gaming Local Aid Fund to finance local aid distributions, mirroring the current system for directing revenue from Plainridge. To level the playing field, a 12.5 percent tax rate would also be applied to daily fantasy sports contests, which are currently untaxed.
The administration anticipates revenues of $35 million in the upcoming Fiscal Year 2020, revenues that the proposal would call for going to local aid.
The legislation calls on the MGC to promulgate necessary regulations to implement sports wagering, including protections for people placing wagers, a cashless system for sports wagering and a verification system to approve age and identity of potential online users. The MGC will also be asked to include the impact of sports wagering on individuals, businesses and the economy in its annual research report.
Similar to the Commonwealth’s current regulations governing daily fantasy sports, wagers would not be permitted on high school, collegiate or amateur events. Wagers would also not be permitted on Esports.