US Sports Betting Update – Massachusetts governor signs sports betting bill
Massachusetts Governor Charlie Baker officially legalized sports betting in the Bay State when he signed a bill on Thursday. The Massachusetts Sports Wagering Act paves the way for up to 15 online sportsbooks to launch, creating the most competitive market in New England. Regulators must now nail down the rules, consider license applications from leading operators and set a launch date for the new industry.
State senators and representatives finally agreed on a compromise bill following intense negotiations earlier this month. The House favored a 15% tax on online sports betting revenue and a 12.5% retail tax. It also wanted college sports betting to be permitted. The Senate took a more draconian approach, pushing for a ban on college sports wagering, a 35% online tax and a 20% retail tax. At one point, it seemed like they would never be able to resolve their differences. Gov. Baker, a keen proponent of sports betting, urged them to come to an arrangement, and they eventually worked it out.
It means that there will be a 20% tax on online revenue and a 15% retail tax. College sports betting will be permitted, but not on games featuring teams based within the state, such as Boston College, Harvard or UMass. Betting on in-state teams would only be available if they reached an NCAA Tournament. As another concession, credit card deposits have been prohibited, so Bay State bettors will need to use debit cards, bank transfers, e-wallets like PayPal or services such as PayNearMe to fund their accounts.
A Market with Vast Potential
Massachusetts is the 15th largest state by population, but it has the 12th largest GDP in the country. That is because the Bay State has the second highest median household income in the United States, trailing only Maryland. There are four major pro sports teams in the state – the Patriots, Celtics, Red Sox and Bruins – while the New England Revolution are also growing in popularity. It all points to Massachusetts becoming one of the country’s largest sports wagering markets.
“Our administration first filed legislation to legalize sports wagering in the Commonwealth several years ago, and I am glad to be able to sign this bill into law today,” said Baker after signing the bill. “We appreciate the dedication and compromise that the Legislature demonstrated on this issue, and we look forward to supporting the work of the Massachusetts Gaming Commission on the responsible implementation of the law over the next several months.”
When Will Massachusetts Sports Betting Start?
Regulators have not yet provided a definitive launch date for sports betting in Massachusetts. Sen. Michael Rodrigues, who was part of the legislative committee that agreed the compromise bill, sparked excitement when he said sports wagering might be ready in time for Week 1 of the NFL season – which begins in less than a month. Another member of the committee, Sen. Eric Lesser, said he felt October was a realistic goal.
However, Brad Hill of the Massachusetts Gaming Commission sought to temper expectations when he gave a press conference this week. “I want the public to understand, as we as commissioners are starting to understand, that this isn't something that's going to happen
overnight,” he said. “I just want the public to be clear, at least from my view — I’m not speaking for the whole commission — but from my point of view, this is going to take a little longer than people probably anticipate, and I’m okay with that, because I want to do it right.”
The Massachusetts Gaming Commission will host a roundtable discussion with current gaming licensees – Encore Boston Harbor, MGM Springfield, Plainridge Park Casino, Raynham Park, and Suffolk Downs – to gain opinions on the best way to proceed. The commission will need to finalize regulations, conduct software testing and issue licenses before setting a launch date. It is likely to come before the end of 2022, but Week 1 of the NFL season looks unlikely.
Which Sportsbooks will Launch in Massachusetts?
Fifteen online sportsbooks can launch in Massachusetts. The bill allows seven standalone licenses. The three casinos – Encore Boston Harbor, MGM Springfield and Plainridge Park – can each host two online skins on their master licenses, while the two racetracks can each host a single online sportsbook.
That will create the most competitive market in the region. New Hampshire and Rhode Island are monopoly controlled, so bettors only have one option. There are just three sportsbooks in Connecticut – DraftKings, FanDuel and PlaySugarHouse – and sports betting is not yet available in Maine and Vermont. New York only permits nine sportsbooks.
The most obvious candidates to launch are BetMGM and WynnBET. BetMGM’s co-owner, MGM Resorts International, owns MGM Springfield. Wynn Resorts owns Encore Boston Harbor, so both sportsbooks gain easy market access. During a 2021 earnings call, Craig Billings – the chief executive of Wynn Resorts – said that “we’ve always viewed Massachusetts as an important boot-strapping event for WynnBET” and that “we’re preparing to be there day one, and that will be an important event for the business.”
DraftKings is a Boston-based business, so it is also highly likely to launch. “Massachusetts, I think, is going to be a great market for us,” said co-founder and chief executive Jason Robins on an earnings call this week. “Obviously, it's our home base. We have a really strong brand here because people know we're a Boston based company. And those who've grown up or lived in New England know that New Englanders tend to really love their own.
“So I think that we'll do quite well. I also think our big DFS database in Massachusetts will be very helpful. So I think we're really well set up here. I'd also add that for at least a little while, we've had an app in New Hampshire, which is the only one. And so I imagine some Massachusetts customers have already crossed over the border and have the app already on their phone. So we think we're in a great spot and Massachusetts is going to be an awesome market for us.”
Barstool also started out in Boston, so it is all but certain to launch in the Bay State. Other major players such as FanDuel, Caesars Sportsbook, BetRivers and PointsBet are also very likely to move into Massachusetts as soon as possible, so it should have a vibrant market.