The Massachusetts Gaming Commission met recently to discuss the issue of legalized sports betting in Massachusetts in light of arguments heard by the Supreme Court in Christie v. NCAA in December of 2017. The justices of the Supreme Court are expected to reach a decision regarding this case as early as April 2018. At this meeting, the Massachusetts Gaming Commission released a white paper which detailed the effect that legalized sports betting could have in Massachusetts.
Christie v. NCAA challenges the Professional and Amateur Sports Act of 1992 (PASPA) which banned legalized sports betting in the United States. In 2014, New Jersey Governor Chris Christie signed a bill which legalized sports betting at casinos and racetracks statewide. Christie v. NCAA argues that PASPA infringes on states’ rights to choose if they want to allow legalized sports betting.
As the Commission’s white paper notes, the national illegal sports betting market generates somewhere between 100 and 150 billion dollars annually. Therefore, if PASPA is overturned, there could be significant economic opportunities within this industry in Massachusetts. The economic effect on Massachusetts will ultimately depend on who is allowed to obtain a sports betting license and the rate at which sports bets will be taxed.
If the Massachusetts legislature limits the distribution of sports betting licenses to brick and mortar institutions and if the gross gaming revenue (the amount wagered minus the winnings returned to players before paying taxes and operating costs) is taxed at a low rate of 6.75%, it is anticipated that revenue would only reach about 8 million dollars annually. However, if the legislature expands licensees to include online, retail and casino locations, accepts new license applicants who are not currently operating in Massachusetts, and taxes gross gaming revenue between 10 and 15%, revenue could be over 60 million dollars annually. Three currently licensed casino operators in Massachusetts, MGM, Wynn Resorts, and Penn National Gaming have already expressed interest in pursuing a sports betting license if PASPA is overturned.
Following in the steps of the fifteen states who have already acted on sports betting and developed legislation in case the Supreme Courts decides to strike down PASPA, Sen. Donoghue of Lowell filed SB 2273. This bill primarily deals with fantasy sports, but also includes a section to would create a commission to study and develop legislation relative to regulating online sports betting. The bill has been referred to the Joint Committee on Economic Development and Emerging Technologies. Due to the potential economic opportunities as outlined in the white paper, Massachusetts Gaming Commission officials are optimistic that the Massachusetts
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