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Even with the NFL season underway, regulators in Massachusetts plan to take their time in crafting implementing rules for sports betting, including through consideration of new policy recommendations to ban in-play betting and limit advertising.
Massachusetts Gaming Commission (MGC) chair Cathy Judd-Stein reminded residents that presently there is no legal method to wager on sports in the Commonwealth.
“Our goal with this process is to make sure that such sports wagering is introduced correctly, operationally and legally, for the benefit of integrity and consumer protection,” Judd-Stein said as she opened a lengthy commission meeting on sports wagering on Thursday (September 8).
Judd-Stein said regulators would accomplish this goal by “working diligently to develop policy, establish a regulatory structure that equitably, fairly reviews … potential operators.”
Judd-Stein said that will she was aware that the NFL kicked off Thursday and that, due to the nature of sports betting, interest is piqued, “our process will play out as it would have whenever this law came to the commission to regulate, and we will not compromise getting this right for anything.”
Commissioner Bradford Hill expressed frustration at hearing a guest on a Boston sports radio show earlier on Thursday saying that some think the state would launch sports betting within the next three weeks.
“Obviously, that is not going to happen,” Hill said. “And it was frustrating because of the hundreds of thousands of people that listen … and think that they might be able to place a bet here in Massachusetts. It was frustrating.”
Massachusetts Republican Governor Charlie Baker signed a sports-betting bill into law last month, mandating the start of the rulemaking and regulatory review process by the commission.
The launch of retail and mobile sports-betting in Massachusetts may still be some months away, however, with some analysts having indicated that a launch is possible by late 2022 or early 2023.
“We’ll get there,” Commissioner Nakisha Skinner said. “We just ask for the public’s patience as we move forward.”
On Thursday, the five-member commission took action to advance several measures directly related to the implementation of sports wagering and heard from problem gambling researchers regarding policy recommendations during a six-plus-hour meeting.
A new study on the potential impacts of sports betting presented on Thursday by Dr. Rachel Volberg, principal investigator with the University of Massachusetts School of Public Health and Health Sciences, recommended the state prohibit in-play sports betting.
She said the study found in-play was disproportionately utilized by problem gamblers.
Another policy recommendation by researchers was to restrict advertising and celebrity endorsements of sports-betting in Massachusetts. The study found these messages tend to promote sports betting among young people and precipitate relapse in recovered gamblers.
In addition, researchers called for restricting player bonuses where rewards are associated with increased expenditure by players.
Volberg said Thursday that researchers also plan to release a study on sports-betting advertising by the end of the year.
In an earlier action, the commission approved MGC staff to start the process to draft regulations for sports betting license applications and related qualification criteria. Similar to the licensing process for land-based casinos, MGC executive director Karen Wells said regulators will propose two parts to the application.
One part would request information required by the Investigations and Enforcement Bureau (IEB) to conduct their suitability investigation into companies seeking a license, while the second part of the application would request information to assist the commission in conducting an evaluation of the various applicants.
Under the sports-betting law, sports wagering licenses are set aside for incumbent land-based casinos and racing facilities, with seven additional licenses available for mobile sports wagering.
Massachusetts' licensing process for casinos, which led to new properties being developed by MGM Resorts, Wynn Resorts and Penn Entertainment, was renowned in the gaming industry for the depth of its suitability investigation process.
The commission also took the initial steps on Thursday of signing off on emergency regulations to approve independent laboratory certification for sports wagering equipment, as well as approving a $2.19m budget to implement and regulate sports wagering, but sent proposed House Rules submission guidelines back to staff for several revisions.
Judd-Stein said the House Rules, which need to be in place before wagers are accepted, will be revisited on Thursday (September 15).
The initial budget, approved unanimously by the MGC, would fund 12 full-time employees and outside administrative, financial and legal assistance.
Wells and Derek Lennon, chief financial and accounting officer for the MGC, said the finance department plans to immediately draft emergency rules that address the collection of fees for operator applications and suitability reviews.
Those regulations will also deal with the collection of license and renewal fees for all three categories of operator licenses, and the collection of occupational license application fees.
Lennon said approval of the budget resolution also creates the Sports Wagering Control Fund, which the commission will use to support its regulatory oversight and other activities related to sports wagering.
Commissioner Hill said he thought that the $2.19m budget was too high a figure to ask for initially when staff could ask for less and then come back to the commission in the future.
But Skinner, who worked with Lennon and other staff on crafting the budget request, told her colleagues that “this is what the team (thinks is) the necessary funding to get this up and running.”
“The request is a starting point, we may need more,” said commissioner Eileen O’Brien.
State Treasurer Deborah Goldberg also testified before the commission on Thursday, asking gaming regulators to require that sports betting operators commit to cross-promoting the Massachusetts Lottery and present a plan to mitigate any financial harm the lottery might experience because of the expansion of gambling.
“We already face mounting headwinds,” Goldberg said. “In fact, we are actively monitoring a concerning trend. Sales of the lottery’s top two products, scratch tickets and keno, which together make up nearly 88 percent of all lottery sales, were down six and five present respectively last month.”
Goldberg added that when she looked at the latest numbers this week, the downward trend had continued.
“While lawmakers project that sports wagering will generate $60m in state revenue each year, only $16.5m will be earmarked for unrestricted local aid,” she said. “By contrast, the lottery produced approximately $1.1bn for our cities and towns just last year.”
“Simply put,” Goldberg told the commission, “the lottery plays a vital role in generating unrestricted local aid for our cities and towns, and it is imperative that we work to ensure it continues to do so.”
