With the one-year anniversary of Massachusetts sports betting having just passed, Governor Maura Healey has submitted an FY2025 budget that would significantly reduce funding for problem gambling research, treatment and prevention.
In this Healey budget proposal, the governor’s office also calls for a statewide online lottery, which could help supplement the commonwealth with the tax revenue it sorely needs.
Gov. Healey proposes budget cuts to Massachusetts gambling addiction aid
Healey’s Fiscal Year 2025 budget proposal calls for a reduction in the portion of Massachusetts sports betting taxes allocated to the Public Health Trust Fund — a fund that provides money for gambling addiction research and treatment. The estimated loss would be $6 million annually.
Massachusetts has an annual budget of somewhere between $50-60 billion. Casinos and sports betting contribute approximately $300 million in tax revenue from their respective activities each year. Under this proposal, gaming fund distribution would be rearranged, cutting the Public Health Trust Fund’s typical 5% allotment to 2.5%.
It would be a one-time cut, with funds shifting to support various transportation, education, and economic development initiatives throughout the state.
The impact on problem gambling efforts wouldn’t be seen right away, though. It could take a few years for gambling problems to outweigh available resources in the commonwealth.
Budget assumes Massachusetts already has enough problem gambling funding
Evan Horowitz, Executive Director of the Center for State Policy Analysis at Tisch College, Tufts University, points out that the budget doesn’t technically call for a cut to problem gambling initiatives. The commonwealth has a “savings fund,” Horowitz says, that is used to pay for the gambling program funding. According to Horowitz, Gov. Healey’s budget merely removes the payments to that savings fund on the assumption that there is already enough there to fund research for some time.
The commonwealth — led by the gaming laws and leadership of the Massachusetts Gaming Commission, which regulates casinos and sports betting — has fortunately been diligent on the issues of gambling addiction, gathering almost $12 million for Massachusetts gambling addiction resources last year alone.
Marlene Warner, Chief Executive Officer at Massachusetts Council on Gaming and Health, appeared on Radio Boston hosted by Tiziana Dearing earlier this month. Warner said:
“Our funding sources [for gambling public health initiatives] are far and above any other state. A lot of states are just making sure there’s a help line, [but in MA there have been] conversations about advertising, [and] what can go on inside casinos. Those [efforts] are helping people in ways that we are measuring, and are seeing tremendous results with.”
Gambling addiction budget cuts pose harm to at-risk residents
Proponents of Healey’s proposal worry that this proposed reduction in problem gambling funding would still ultimately be harmful to residents. Warner noted that 2% of Massachusetts has a gambling problem, and “another 8.4% are at-risk for gambling addiction.”
During a recent Radio Boston segment, Chris Serres of the Boston Globe concurred:
“It is true that Massachusetts spends more per capita on problem gambling services than just about any other state. We don’t fully understand the prevalence of the problem.”
Economist Jay Zagorsky of Boston University says the amount Massachusetts spends on problem gambling research isn’t the main issue though. It’s whether the commonwealth should be spending at all. Zagorsky suggests Massachusetts shouldn’t simply be replicating efforts being undertaken by other states. Instead, Zagorsky says, states should pool their gambling addiction resources and research in order to produce the best data and recovery assistance.
Results from studies performed by the Massachusetts Gaming Commission are still pending. Once that data becomes available, it may become more clear how many citizens are actually suffering from problem gambling.
Online lottery would provide new source of tax revenue
The Massachusetts lottery, established in 1972, is a major tax resource for the state. Players spend a substantial $7 billion on the state lottery each year, with a record $1.112 billion in tax revenue going to the state in 2021. Gov. Healey sees the launch of an online lottery as a natural way to create even more tax revenue.
According to Radio Boston hosted Tiziana Dearing:
“Massachusetts residents spend three times more on the lottery than residents in other states.”
Some lawmakers, according to Horowitz, are advocating for massive budgets for advertising the lottery and a potential online lottery. That’s because the money is enticing.
Horowitz remarked:
“The state is addicted to gambling revenue.”
A legal online lottery would require legislation and new regulations from the Massachusetts State Lottery Commission.
Gov. Healey’s budget proposal will now head to the State House of Representatives for debate and any amendments. The State Senate will also need to provide a full vote before this FY2025 budget receives approval.
