Sports Betting Bills Pile Up During Massachusetts Legislative Marathon

Posted By Matthew Kredell on February 22, 2021

There’s no lack of interest in legalizing sports betting in Massachusetts, that’s for sure.

By the time Friday’s end-of-day deadline to file legislation passed, the Bay State had 14 sports betting bills.

That’s a record number of active sports betting bills in one state. They say all records are meant to be broken. But, in this case, let’s hope that’s not true.

While it’s nice that so many lawmakers feel passionate enough about sports betting to introduce a bill, the differing proposals leave a lot to be worked out this session.

For a state that spent the past two years discussing the issue at the committee level, the lack of consensus is disappointing.

Here’s an effort to make sense of the mass of sports betting bills in Massachusetts.

Not all Massachusetts sports betting bills are equal

These bills start on equal footing, but we all know that some will get more serious consideration than others.

Two bills from Bradford Hill really seek to regulate fantasy sports while setting up a study for sports wagering. That leaves 12 sports betting implementation bills.

Rep. Orlando Ramos and Sen. Adam Gomez filed companion bills, and both of those lawmakers are in their first year in office.

Rep. Daniel Cahill filed a companion bill to S 177, introduced earlier this session by Sen. Brendan Crighton. Crighton introduced the first sports betting bill in Massachusetts in 2019.

That makes 10 unique implementation bills. And Rep. Tom Walsh’s bill is very similar to Crighton’s.

The real one to watch of the new bills filed Friday comes from Sen. Eric Lesser. Lesser chairs the Joint Joint Committee on Economic Development and Emerging Technologies that handled sports betting hearings the past two years.

And, of course, there is a bill from Gov. Charlie Baker himself. That’s the guy who needs to put his signature on one of these proposals to make it law.

Three categories of sports betting licensees common

Nearly all of the Massachusetts sports betting bills create three categories of licensees: casinos, racetracks and online-only.

Encore Boston HarborMGM Springfield and the Plainridge Park slots parlor are the three facilities that qualify for a Category 1 license.

There are no racetracks currently operating in Massachusetts, but the bills anticipate that some will open if given sports betting. Most of the bills set up a minimum investment and race days required to hold a sports betting license.

Where the bills differ is in how many online-only licenses to allow. Lesser’s bill permits six, while Crighton’s is unlimited.

Some proposals try to limit the online-only market. Rep. David Biele’s bill appears to limit it to DraftKings and FanDuel. Sen. Paul Feeney’s bill, meanwhile, allows only one online-only license, likely to go to Massachusetts-based DraftKings.

The Ramos/Gomez bill also appears to allow lottery retail vendors to participate in sports wagering.

Sports betting license fees and tax rate trending up

At this point, it seems safe to discount any bill that doesn’t have initial fees of at least seven figures. That includes the bills from Gov. Baker, Senate Minority Leader Bruce Tarr, Biele, Sen. Michael Brady and Sen. Michael Rush.

The bills from Crighton/Cahill, Ramos/Gomez, and Walsh want $10 million upfront for a sports betting license.

Lesser creates a tiered license fee and tax structure:

  • Casinos pay $2.5 million for five years plus an application fee of at least $1 million (determined by commission) for retail sports wagering and three online skins. Taxed at 20%.
  • Racetracks pay $1.5 million for five years plus an application fee of at least $1 million for retail sports wagering and one online skin. Taxed at 20%.
  • Online-only licensees pay $7.5 million for five years plus an application fee of at least $2 million. Taxed at a higher rate of 25%.

Professional sports league support varies

All of the Massachusetts sports betting implementation bills include a mandate to use official league data for in-play wagers except the proposals from Lesser, Tarr and Baker.

Lesser actually requires that data suppliers pay hefty fees to get licenses of their own. Suppliers must pay $5 million for a five-year license, renewable for $2 million, with a minimum $1 million application fee.

Operators may then choose their data source from among the licensed options.

The bills from Ramos/Gomez and Biele add a 1% facility tax operators must pay on wagers made on games hosted at Massachusetts sports venues. Rush gives professional sports leagues a 0.25% royalty on all wagers.

To bet or not to bet (college sports)

Massachusetts university presidents asked lawmakers not to allow betting on in-state teams. All but Ramos/Gomez, Brady and Rush listened.

Gov. Baker asked for a ban on all college wagering, and Lesser and Tarr followed his lead.

In a presser Monday, Lesser explained why he prohibits wagering on college sports:

“Professional athletes are in unions; they’re protected by collective bargaining agreements. Student athletes are not. Professional athletes are paid, student athletes are not. Professional athletes have a structure and supports through their professional teams and their associations and their unions that again student athletes do not. All the Div. I schools in Massachusetts have been very clear that they’re completely against betting on college sports. So I thought for those reasons it’s better to at least get started with professional sports only, and then we’ll see where that goes.”

Lesser also prohibits wagering on the Olympics and instructs the Massachusetts Gaming Commission to study whether to allow wagering on esports.

Crighton/Cahill, Walsh, Brady and Biele allow wagering on esports. Tarr is the only one to specifically prohibit esports wagering.

Payment options for Massachusetts sports betting

Another area that needs to be worked out in Massachusetts is in what manner betters can fund their online betting accounts.

Most of the bills, including Crighton’s, leave that up to the gaming commission to decide.

Feeney’s legislation specifies a wide variety of funding options, including credit cards and PayPal.

But Lesser prohibits the use of credit cards. He explained:

“In talking to many of my colleagues and consumer advocates, a vast majority of people are just looking to have some fun. It’s a form of recreation, it’s a bet on their favorite sports team. But we do know there are some people who might have addiction issues, might have problems. We don’t want to see an issue where someone, with a swipe of their finger on their iPhone because of their addiction or another problem, is racking up massive credit card bills that they won’t be able to replay.”

 

Photo by AP / Mary Schwalm
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Matthew Kredell

Matthew has covered efforts to legalize and regulate online gambling since 2007. His reporting on the legalization of sports betting began in 2010 with an article for Playboy Magazine on how the NFL was pushing US money overseas by fighting the expansion of regulated sports betting. A USC journalism alum, Matt started his career as a sportswriter at the Los Angeles Daily News and has written on a variety of topics for Playboy, Men’s Journal, Los Angeles magazine, LA Weekly and ESPN.com.

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