Two additional sports betting bills filed in Massachusetts

18 January 2019

Massachusetts lawmakers will discuss at least five sports betting bills during the 2019 legislative session after Governor Charlie Baker and Senator Michael Rush introduced two separate bills.

Baker’s bill sets out proposals to legalise retail and online sports betting, with a provision for operators to set up a stand-alone sportsbook without partnering a land-based casino in the state.

The Massachusetts Gaming Commission would manage the licencing process. Companies interested in operating in Massachusetts would have a range of licences to apply for, depending on the channels through which they plan to offer wagering.

In-person sports betting licences would include a tax rate of 10% on gross sports betting revenue, while online-only licences would see operators pay a rate of 12.5%. Baker would also introduce a new 12.5% tax on fantasy sports contests, which are currently taxed in the state.

Companies seeking a new licence would also need to pay an application fee of $100,000 (£77,200/€87,800), as well as a licensing fee of no less than $500,000. Operators would be required to renew their licences every five years.

Should the bill pass into law, Baker’s administration has forecast that it could generate an additional $35m in revenue for the state during the 2020 fiscal year.

Rush’s proposal (SD.1110), meanwhile, joins only a handful of sports betting bills in the US to offer royalty fees to US professional sports leagues.

A number of leagues have called on states to include this measure as part of their new sports betting laws - often referred to as an integrity fee - but many bills and subsequent regulations have opted against such a scheme.

However, Rush’s bill aims to pay the leagues 0.25% of the total amounts wagered each quarter. Sportsbooks would also be required to purchase official betting data from the leagues.

Rush’s bill would also legalise both retail and online sports betting, but online-only companies targeting the state would need to establish a partnership with a land-based gambling facility.

Operators would need to pay an initial $100,000 application fee as well as $10,000 in renewal costs each year for the licence. However, the bill does not specifically set out the tax rates that companies would face after securing a licence.

The two bills join three other bills that were also filed earlier this week, each of which sets out a different vision for legalised sports betting in Massachusetts.

Senator Brendan Crighton’s SD 903 would legalise retail and mobile operations in the state, with gross revenue taxed at 12.5%. Operators would also face an initial application fee of $500,000 followed by a $100,000 annual renewal fee.

Senator James Welch’s SD 882 is less detailed but does outline plans to enable casinos in the state to begin sports betting operations. The bill sets out a 6.75% tax on sports betting revenue for both Category 1 and Category 2 licensees.

Elsewhere, Senator Bruce Tarr’s SD 908 would not legalise sports wagering but would establish an 11-person commission to consider the impact of legal sports betting in Massachusetts.

All five bills are yet to be assigned to a Senate committee to be examined further. Any other bills that are to be considered during the 2019 legislative session must be submitted before today’s (January 18) deadline).

Massachusetts has a population of 6.9 million and is home to major sports teams such as NFL franchise the New England Patriots and MLB outfit the Boston Red Sox. In addition, daily fantasy giant DraftKings is based in the state.

Image: Keith Allison