After months of debate and deliberation, it seems Massachusetts sportsbooks will be able to operate within the state in the near future.
The legalization of sports betting in Massachusetts has been a hot topic of conversation for some time as operators waited with bated breath to see if the nation’s 15th-most populous state would be added to the list of states to open their doors to the top online sportsbooks.
Deal Finally Struck
Early Monday morning, their prayers were answered. House Speaker Ron Mariano took to Twitter to reveal the decision. “I am proud to announce that the Sports Betting Conference Committee has reached an agreement on legislation that will legalize wagering on professional and collegiate sports in Massachusetts, bringing the immense economic benefits of a legal sports betting industry to MA”, he said.
“It’s also going to create a whole new industry and a whole new sector for our economy and a whole new way for people to engage with their favorite teams,” added State Senator Eric Lesser. “I think given the scope of what we’ve included here, including college that’s out of Massachusetts I think we’re probably going to see 60-to-65 million dollars a year.”
Following Monday’s decision, the bill will now be passed on to Governor Charlie Baker, who has 10 days to either sign the bill or reject it. Baker’s previous stance on sports betting in the state makes it appear likely that it will be signed.
“I’ve said before that with all that’s going on in other states and especially the ones around us with regard to sports betting, it’s important for us to pass legislation and legalize it here,” he said. “My hope would be that [the House and Senate] would both work to get something to our desk so that we can sign by the end of the session”.
There has been plenty of evidence of Massachusetts sports fans crossing state borders to place wagers on their favorite sports teams, leaving MA to miss out on revenue that could be generated in additional taxes. Massachusetts is one of the United States’ biggest sports states and is home to major professional sports franchises such as the Boston Celtics, New England Patriots, Boston Red Sox and Boston Bruins.
House and Senate Compromise
The House and Senate had to compromise on a number of issues, the biggest of all being taxes. Operators will be forced to pay 15% tax on retail sports betting revenue and 20% on mobile sports betting revenue. It is a rise from the 12.5% retail and 15% mobile rates proposed by the House, but is a drop from the 20% retail and 35% tax rates pushed forward by the Senate. The Senate was successful, however, in denying operators the opportunity to deduct promotional costs from taxable revenue.
The Senate was also keen to ban betting on all college sports, something we have only seen previously from Oregon sportsbooks. The House, on the other hand, was willing to accept bets on college sports and the two sides were again forced to meet in the middle.
A deal was struck on the basis that operators would be unable to accept wagers on games involving Massachusetts-based schools. This is something that we have also seen in Illinois sportsbooks, New Jersey sportsbooks and New York sportsbooks.
However, sports bettors are able to bet on their favorite in-state teams in post-season college tournaments such as March Madness, which is typically one of the biggest months of the year when it comes to sports betting revenue. Lesser said: “All 10 of the Division I programs in Massachusetts asked us to keep betting off their campuses”.
The Senate didn’t get its own way on its stance on advertising. They had put forth a potentially unconstitutional ban on gambling advertisements, but the Massachusetts Gaming Commission will instead enforce the following standards that all licensed operators must abide by and avoid breaking when it comes to their ads:
- Deceptive or ambiguous ads
- Unsolicited pop-ups or texts to those on the self-exclusion list
- Any advertising, marketing or branding the commission “deems unacceptable or disruptive” at sporting events
- Ads targeting anyone under the legal betting age of 21
- Billboards or any other public signage that breaks federal, state or local law
Professional sports teams in Massachusetts will not be able to be licensed sportsbook operators, but they can enter commercial agreements with licensed sports wagering operators. From these partnerships, franchises can take a share of the revenues derived from wagering on selected sporting events.