Candidate for Massachusetts Lt. Governor Promises that Legal Sports Betting in MA is a Priority

On January 4, 2022, Eric Lesser, a State Senator in Massachusetts, made public his intention to campaign for the position of Lieutenant Governor in the state. Lesser, a well-known advocate for the legalization of sports betting, has voiced his optimism for the implementation of legal sports betting well ahead of the upcoming election.

Candidates have come forward for the upcoming November 2022 Massachusetts gubernatorial election, with legal sports betting anticipated to be a prominent concern, following Governor Charlie Baker’s announcement in December that he will not pursue a third term.

The holdup in legalizing sports betting in Massachusetts

The federal ban on sports betting was struck down by the United States Supreme Court (SCOTUS) in May 2018, causing a significant impact. This ruling paved the way for individual states to legalize sports betting.

After the SCOTUS ruling nearly three years ago, several states, including neighboring Connecticut, Rhode Island, New Hampshire, and New York, have embraced the legalization of sports betting by establishing sportsbooks.

Although MA Governor Baker and the state House are highly supportive of legalizing sports betting, there is currently no legislation that has been passed.

In July 2021, a nearly unanimous vote in the House approved the legalization of sports betting in Massachusetts. Regrettably, the state senate has yet to make any progress on the matter.

Lawmakers have faced challenges in determining the eligible entities, such as casinos and race tracks, that can partake in sports betting. Furthermore, there have been previous rejections to include college sports in legalized betting activities.

Sports betting study ordered by Massachusetts Gaming Commission

In November, the MGC mandated a study to be undertaken by the SEIGMA, focusing on the Social and Economic Impacts of Gambling in Massachusetts.

The study aims to persuade Massachusetts lawmakers about the state’s economic advantages associated with legalizing sports betting.

Commissioner Brad Hill stated that he believes this will be the predominant concern we will face in the future. He emphasized the importance of obtaining as much information as possible to aid in our decision-making process.

What would legal sports betting look like in MA?

Senator Lesser has recently presented his own sports betting bill, labeled as S.269. This bill has the potential to gain significant support in the Senate, where it had previously been lacking.

The proposed bill suggests that the existing three casinos and racetracks in the state should offer both in-person and online sports betting. Additionally, the bill prohibits betting on amateur sporting events and college sports.

In the House’s initial bill, which was previously voted on, there were provisions granting privileges to the state’s two simulcasting facilities to offer sports betting.

Encore Boston Harbor, Plainridge Park, and MGM Springfield, the three Massachusetts casinos, have collectively made a formal request to the state government for the legalization of sports betting in various formats. Members of the state’s gaming industry have raised concerns about the potential loss of revenue to neighboring states.

Lessor, a long-time advocate for legal sports betting in the state, expressed his support for the proposed bill, stating:

“Why don’t we begin legalizing gambling in areas where there is a consensus, as pro sports teams are in favor of it?”

Learning from neighboring states

The objective of the sports betting study is to present compelling evidence in favor of legalizing sports betting in MA. Nevertheless, proponents of legalization among Massachusetts lawmakers are optimistic that the reported revenues from neighboring states will influence their colleagues.

New Jersey, for instance, witnessed a greater volume of legal sports bets than any other state, surpassing even Nevada. The tax revenue generated from sports betting in NJ during 2021 amounted to an impressive $95.14 million.

In addition, it is reported by New Jersey that a significant 93 percent of the revenue generated from sports betting taxes comes from online sports bets.

Is prospective Massachusetts tax revenue being lost to neighboring states?

Massachusetts lawmakers are becoming increasingly worried about the loss of tax revenue due to residents crossing state lines for sports betting. They have observed that neighboring states allow non-residents to legally participate in sports betting as long as they are physically present within their borders.

There are lawmakers who express concerns about the financial losses resulting from illegal sports betting.

MA Representative Andy Vargas expressed his disappointment, stating, “Once again, we are missing out on potential revenue while the black market takes advantage of the absence of a regulated sports betting environment.”

How sports betting will benefit the Commonwealth

The proposed bills for the legalization of sports betting suggest that distinct tax rates will be applied to in-person and online wagers.

• There will be a 12.5% tax on bets made in person.
• There will be a 15% tax applied to mobile bets.

The initial predictions for tax revenue generated from sports betting in MA will rely on the proposed bills and information gathered from neighboring states. The estimates project an annual tax revenue ranging from $60 million to $70 million. Furthermore, over a span of five years, at least $70 million in licensing fees would be collected.

Eric Lesser, a candidate for Lt. Gov in Massachusetts, remains hopeful as lawmakers continue to grapple with reaching a consensus on the legalization of sports betting.

He expressed his hope to accomplish it well in advance of the campaign, emphasizing that the election is still a considerable 10 to 11 months away.