Despite a quartet of proponents that included daily fantasy giants DraftKings and FanDuel, MGM Resorts International, and the Boston Red Sox, a push for legal sports betting in Massachusetts ended Wednesday night.
The Massachusetts Senate removed language from a $459 million economic development package the would have made the state the 24th market in the U.S. to approve legalized sports betting. The measure, which was overwhelmingly approved in the Massachusetts House Tuesday, provides funding for nonprofits damaged by the coronavirus pandemic, several local projects, and language that would have legalized sports betting.
“As it relates to sports gaming, sports wagering, I believe that certainly, the time is close when we are going to be tackling this issue, but the time is not now,” State Sen. Michael Rodrigues, chairman of the Senate Ways and Means Committee, said as he spoke on the Senate floor Wednesday night according to MassLive. “Nor is this the proper vehicle to do so in.”
Sports betting could be revisited later this year.
Brendan Bussmann, a partner in the Las Vegas-based Global Market Advisors, who has been monitoring the Massachusetts debate, told CDC Gaming Reports Wednesday the current House bill “leaves an incredible amount of revenue on the table by appearing to focus on politicking instead of policy. The proposed structure is far from optimal.”
Bussmann said Massachusetts would be a “strong” sports betting market. He told MassLive that lawmakers should continue to take a thoughtful approach to craft a legal sports betting market, rather than tacking it onto a wide-ranging economic development bill.
“If Massachusetts wants to maximize the market opportunity, it should create a dynamic, competitive market by not artificially stifling competition (and) allowing suitable operators into a free market that will attraction innovation and investment,” Bussmann told CDC Gaming Reports.
Massachusetts Gov. Charlie Baker had publicly voiced support for sports betting to be legalized in the state.
“We consider (his support) the most critical factor,” Jefferies gaming analyst David Katz told investors in a research note on Wednesday.
The bill offered three types of sports betting licenses: online and in-person wagering at the MGM Springfield, Penn National’s Plainridge Park, and Wynn Resorts’ Encore Boston Harbor; in-person wagering at racetracks; and digital-only platforms for operators that have offered daily fantasy in Massachusetts for at least a year and are licensed for sports wagering in two other states.
Penn National has a partnership with sports media platform Barstool Sports to create both a mobile sports betting app and Barstool-branded retail sportsbook operations. MGM is partners with UK betting giant GVC Holdings in Roar Digital, which operates the BetMGM sports wagering platform.
Katz said the last category benefits DraftKings, which is headquartered in Boston and has operated in the state since 2013, as well as FanDuel.
An application fee of $250,000 covers the first five-year period and can be renewed for another five years for $100,000. Sports betting revenues will be taxed at 15% plus an additional 1% for events that take place in the state. That fee would be divided among the owners of those facilities, including Fenway Park, home of the Red Sox.
Currently, 18 states currently offer legal and regulated sports wagering through casinos, racetracks, and online. Washington D.C. legalized sports betting last year and currently offers a mobile-only product. Another four states have legalized sports betting but are still approving regulation and could launch this year.
In 2019, gamblers nationwide wagered more than $13 billion legally on sports, a figure that was easily on track to be crushed in 2020 until COVID-19 shut down all college and professional sports and the gaming industry.
Katz said if Massachusetts is successful in legalizing sports betting, it could put pressure on nearby Connecticut to legalize the activity. It could also compel New York, which already allows sports betting in upstate tribal casinos, to explore launching mobile sports betting. New Hampshire and Rhode Island have already legalized the activity.
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at firstname.lastname@example.org. Follow @howardstutz on Twitter.