Massachusetts Senator Brendan Crighton.

  • Legal sports betting in Massachusetts could produce millions of dollars in annual revenue for the Commonwealth.
  • Senator Brendan Crighton will file a bill to make sports betting legal in the Bay State, allowing for collegiate and professional sports games to be gambled on.
  • The FY2022 is in need of new revenue streams because of the Coronavirus Pandemic and the approval of this bill into law in 2021 would serve as one of these new sources of revenue.

BOSTONSenator Brendan Crighton (D-Lynn) of Massachusetts will be filing a bill to legalize sports betting in Massachusetts in the coming days.

This is not the first time that the Senator has tried to get the approval of the Massachusetts Legislature to make wagering on sports legal. In fact, the proposal that he will be introducing to the Legislature is very much like that of House Bill 4559 from last year, having many of the same stipulations within it.

LegalSportsBetting spoke with the Senator about his thoughts on this legislation and what it would mean for Massachusetts.

Speaking to Senator Crighton

Massachusetts is home to so many terrific professional sports teams but the Commonwealth still does allow their citizens to gamble on sports matchups with state-affiliated sportsbooks. While sports betting is prevalent in the area, residents go about it through other means like that of offshore internet sportsbooks or traveling to neighboring states.

However, the Bay State does not receive anything from wagering in that manner, which is something that Senator Crighton would like to change.

“I think there is going to be a lot of difficult decisions in the upcoming FY2022 budget and we are certainly taking a look at revenue in general here in the state to make sure we will be able to maintain high levels of service and also help people in this recovery as well as the existing public health crisis in which this money again is just going to the black market as well as other states,” said Crighton. “I think that’s a compelling argument that folks will be able to get around in addition to the protections for consumers when considering legalizing sports betting for the state.”

Because the state is facing a very hard fiscal year for 2022, any revenue that would be made from legal sports betting in Massachusetts would go toward various valuable programs statewide that may have been impacted financially by the Coronavirus Pandemic. Although the new bill has a number of similarities from prior legislation, there are still a few differences of note according to Crighton.

“This time around we set the tax rate at 15% which we believe will help keep the operators very competitive against the illegal market as well as our neighboring states and we also have a licensing fee that is higher than previous legislation, set at $10 million per each license application,” said Crighton.

“The regulatory body for the industry would be the Massachusetts Gaming Commission. Consumer protection would stand as the main priority with this legislation and help to pull people out of the shadows as sports betting is very much alive and well in Massachusetts but unfortunately, it’s being done so through illegal markets or with our bordering states that have legal industries.”

Another change is with the inclusion of college sports. Before, all college sports were not part of the package but this time around they have been included just so long as those teams are not from schools in the state. All betting on Massachusetts collegiate sports will be prohibited.

Crighton said this is because the institutions themselves requested that they be excluded from the bill, not wanting to have their games open to wagers. Governor Charlie Baker, who has spoken in favor of a legal industry, is opposed to all collegiate sports betting.

“Having Governor Charlie Baker on board for legal sports betting over the past few years has certainly been important. There are a few differences between the legislation and his vision as he would like to exclude college sports altogether but I’m sure we can find a way to get to an agreement and have this bill passed,” said Crighton. “But it has been very helpful that legalizing sports betting for the state of Massachusetts has been a priority for the Governor.”

There will be quite a few benefits to be had from sports wagering legalization in Massachusetts. Those eligible to apply for a license include brick-and-mortar casinos as well as the slot parlor, existing racing license holders, horse racing tracks, and mobile sportsbook operators. Crighton believes the addition of college sports and the mobile sportsbook component will do wonders for the market as it makes for a more competitive model. And there will be a ripple effect in benefits from legalizing sports gaming.

“Overall, with just the economy, there are a number of brick-and-mortar facilities here, we are home to other industries that would benefit from legal sports betting because jobs will be created because of it so even though they may not benefit from the direct revenue from the tax rate or licensing fees, there will be an economic stimulus that will be felt throughout the state that will be helpful,” said Crighton.

The higher tax rate is expected to bring in a good amount of money while still not being too extreme where it would deter from the profits of operators.

At this point in time, there is no written cap as to how many operators will be allowed licensure in the state because the proposal was done to not be overly descriptive and appear more flexible for future debates in the House and Senate.

But revenue estimates have been looked at when comparing to other states with similar models for the Legislature to have a grasp on how much profit could be made by this new revenue stream.

“We have had the benefit of being able to see how other states have approached this over the past two years and we believe this policy is pretty sound and will definitely be given consideration by the Massachusetts Legislature which we look forward to,” said Crighton. “Structures not unlike the one we are proposing with a 10% tax rate have been able to generate annual revenue of $45 million so I think it’s safe to say that a 15% tax rate would produce greater than $45 million through a conservative estimate.”

Looking Ahead

The Massachusetts Legislature convenes this month. They will adjourn on December 31. Should Crighton’s bill pass as it’s expected to seeing as rumors have been swirling about including a legal sports wagering market in the FY2022 budget, a launch of the industry would be something that the Massachusetts Gaming Commission would be in charge of as they’d hold the final piece of the puzzle.

“It’s hard to say when a launch would occur if the industry were to become legal but I suspect that since it’s been a few years since the Supreme Court’s decision (repeal of PASPA) that most of the folks in the industry have been preparing for legalization,” said Crighton.

“I believe it would be the betting regulation process with the Massachusetts Gaming Commission that would serve as the only hurdle to get an industry up and running soon after the law has been enacted. But hopefully, it will be a quick turnaround. And it should be because other entities that are doing this in other states would be operating here so it is not as if they’d need to reinvent the wheel, which would allow a launch to happen pretty quickly.”

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