Massachusetts State Senator Eric Lesser announced on January 4, 2022, that he intends to run for Lieutenant Governor of the State of MA. A known supporter of legalizing sports betting, Lesser has expressed hope that legal sports betting will be put in place even before the election.
In December, Massachusetts Governor Charlie Baker announced that he would not be seeking a third term. Since then, candidates have emerged for the 2022 Massachusetts gubernatorial election in November, and legal sports betting will likely be a top issue.
The holdup in legalizing sports betting in Massachusetts
In May of 2018, the United States Supreme Court (SCOTUS) made waves in striking down the federal ban on sports betting. The ruling opened the door for states to legalize sports betting individually.
Since the SCOTUS decision almost three years ago, many states have already instituted sportsbooks. Massachusetts neighbors, Connecticut, Rhode Island, New Hampshire, and New York, are among states where sports betting is now legal.
While MA Governor Baker and the state House have expressed overwhelming support of the legalization of sports betting, no legislation has currently passed.
The House passed a near-unanimous vote back in July of 2021 to approve legal sports betting in Massachusetts. The state senate, however, has taken no action.
Lawmakers have struggled to decide which entities, like casinos and race tracks, would be able to participate in sports betting. Additionally, legalization has been struck down previously to include college sports in betting practices.
Sports betting study ordered by Massachusetts Gaming Commission
Back in November, the MGC ordered a study to be conducted by the Social and Economic Impacts of Gambling in Massachusetts (SEIGMA).
The hope is that the study would convince MA lawmakers of the economic benefits of legal sports betting in the state.
“I think this is going to be the issue that we’re going to be all dealing with in the future,” Commissioner Brad Hill said. “And the more information we can get, the better to help us as we come up and make our decisions.”
What would legal sports betting look like in MA?
Senator Lesser actually introduced his own sports betting bill, S.269, which may gain some traction in the Senate where it was previously lacking.
His bill proposes that the state’s three current casinos and racetracks operate in-person and online wagering for sports betting. His bill also prohibits betting on amateur sporting events and college sports.
The House’s original bill previously voted on also included privileges for the state’s two simulcasting facilities to take sports bets.
All three Massachusetts casinos, Encore Boston Harbor, Plainridge Park, MGM Springfield, have officially asked the state to legalize sports betting in all forms. Representatives of the state’s gaming industry have expressed concern that prospective revenue is losing to neighboring states.
Lessor has long been a supporter of legal sports betting in the state, and he said of his proposed bill:
“Pro sports teams want legalized gambling. Why don’t we get started where there’s a consensus?”
Learning from neighboring states
The sports betting study hopes to provide convincing data supporting legalized sports betting in MA. However, Massachusetts lawmakers that support legalization hope that reported revenue in neighboring states will sway their colleagues.
In New Jersey, for example, the highest number of legal sports bets are outside of Nevada. NJ taxes taken on sports betting in 2021 totaled $95.14 million.
Additionally, New Jersey reports that 93 percent of the sports betting tax revenue generates from online sports bets.
Is prospective Massachusetts tax revenue being lost to neighboring states?
MA lawmakers are certainly concerned that tax revenue is losing across state lines. Sports betting in neighboring states is legal for non-residents as long as they are physically in the state.
Some lawmakers are even concerned that revenue is being lost by illegal sports betting.
“It’s just another year where we lose out on the revenue,” said MA Rep. Andy Vargas, “and the black market continues to capitalize on the fact that we don’t have a regulated environment for sports betting.”
How sports betting will benefit the Commonwealth
Proposed bills to legalize sports betting stipulate that in-person and online wagers will be taxed at different rates:
- In-person bets will tax at 12.5%
- Mobile bets will tax at 15%
Early estimates for MA tax revenue on sports betting will base on the proposed bills and data from neighboring states. Estimates predict between $60 million and $70 million in annual tax revenue annually. In addition, at least $70 million in licensing fees would flow in every five years.
As lawmakers struggle to come to a consensus on legalizing sports betting in Massachusetts, Lt. Gov candidate Eric Lesser is hopeful.
“My hope is that we can get that done long before the campaign,” he said. “Keep in mind the election is 10, 11 months from now.”