Massachusetts Governor Charlie Baker made big news in the national sports betting industry this week. On Friday, Baker had to make his annual state budget proposal to the Massachusetts Municipal Association.
He introduced HD 678 right prior to the meeting, which would legalize sports betting in the state.
The Details of HD 678
Massachusetts has a strong gaming economy even though sports betting isn’t currently present in the state. The state’s two largest licensed casinos are MGM Springfield and Encore Boston Harbor.
In addition to these properties, Massachusetts is the home to four major professional sports teams in the New England Patriots, Boston Red Sox, Boston Bruins, and Boston Celtics.
Charlie Baker revealed that HD 678 would allow licensed casinos and online sports betting providers to offer mobile betting throughout the state. Baker outlawed collegiate and Esports betting in the first draft of the bill.
This could change as the legislative process begins, but HD 678 exclusively legalizes professional sports betting.
Modeled After New Jersey
New Jersey has become one of the largest sports betting markets in the United States. The December betting handle in the state was nearly $1 billion.
Many legal betting states will not reach $100 million for a yearly handle, which shows the vast size of the New Jersey market.
HD 678 gives the Massachusetts Gaming Commission complete jurisdiction over the Massachusetts sports betting industry. The Massachusetts Gaming Commission would have the right to improve applications and enforce the government’s regulations.
Online providers wouldn’t have to be associated with a casino to operate in the state. This will allow a lot of platforms to operate in Massachusetts.
Casinos in Massachusetts would have the ability to apply for a retail sports betting license while offering online sports betting as well. In-person wagers would only be taxed at 10%.
Online wagering would have a slight increase in tax percentage under HD 678. Online revenue would be taxed at 12.5%.
The application fee would be $100,000, and the licensing fee would be $500,000 upon approval. The licensing agreement would need to be reapproved every five years.
The Impact of HD 678
Baker’s proposal of HD 678 made a big splash in the legal sports betting industry. The House approved sports betting in 2020, but the bill died in the Senate. HD 678 is more likely to pass because of the COVID-19 pandemic.
If HD 678 was passed, it could create $35 million in state tax revenue. This is the third year that Baker has included sports betting revenue in his annual budget proposal. However, he hasn’t had any luck passing the bill in the past two years.
Twenty states across the nation have legalized sports betting. Border states like New Hampshire and Rhode Island have legalized mobile sports betting. Connecticut is on the verge of legalizing the form of gambling in 2021.
This could force the hand of the Massachusetts legislature when it comes to HD 678. The state will continue to lose potential revenue to these border states if they don’t pass a sports betting bill.