Massachusetts lawmakers hail deadline busting compromise on sports betting

Massachusetts could legalize sports betting by the end of 2022, after state legislators forged a last-minute compromise deal to approve a framework for the vertical late last night.

In meetings yesterday at the end of the regular legislatory session, senate and house officials extended their initial deliberation deadline past 2am, before announcing an agreement at 5:10am this morning.

I want to thank @RepMichlewitz and @JerryParisella, all the conferees and my colleagues in the House, as well as our partners in the Senate for recognizing the incredible economic opportunity that legalized sports betting presents. (2/2)

— Speaker Ron Mariano (@RonMariano) August 1, 2022

Passage of the legislation comes amid a frenetic period of lobbying in the Bay State, with local casino operators, business associations and even state Governor Charlie Baker, who expressed his hope that an agreement could be reached last week.

SPORTS BETTING LATEST: "There are very significant conversations going on between the branches about this. So it's clearly still on people's radar. It is very much on people's to-do list." – Gov. Baker with less than four days left for formal sessions. #mapoli

— State House News (@statehousenews) July 28, 2022

? Massachusetts Sports Betting:

"3 proposals have back and forth in the last 24 hours and literally — literally — as we speak right now, our staffs are having meetings on the nuances and details of the bills," Sen. Rodrigues to @statehousenews Friday ?

Deadline Is Sunday https://t.co/cHvgPQq2fn

— Bill Speros (@billsperos) July 29, 2022

Central to the compromise agreement between house and senate was negotiations on issues including whether to allow betting on college events, taxation, the number of licenses and whether gambling related advertising would be allowed in the state.

In respect of taxation, house representatives pushed a 15% mobile sportsbook tax rate and a 12.5% retail tax rate, with operators allowed to deduct promotional spend from overall taxable revenue.

In contrast, their senate colleagues sued for less operator friendly tax rate of 35% on mobile and 20% on retail sportsbooks, with no promotional related deductions allowed.

Senate and house representatives differed on licensing, with senate restricting the market to nine mobile sportsbook licenses with a further three going to state-licensed casinos, while their house counterparts imposed no limitation on online licenses.

Legislators were also split on whether to allow college betting, with house favoring betting on the vertical in contrast to the senate which opposed the legalization.

The final bone of contention was a complete ban on TV advertising, as well as a number of other restrictions on operator marketing, which while favored by the senate, would prove controversial for the house and other interested parties.

Representatives from teams including the Boston Celtics, Bruins, Red Sox and the New England Patriots also entered the debate, jointly authoring a letter calling for the rejection of the senate’s proposals on the grounds it would be unconstitutional.

Initial reports have claimed that a tax rate of 20% will be applied to mobile sportsbook and a 15% tax rate on retail sports betting.  Credit card betting will be prohibited under the compromise deal.

In-person wagering will be allowed at casinos, racetracks and simulcast racing facilities. Each of the state’s casinos can operate up to two mobile betting skins, with racing facilities allowed one mobile skin.

A further seven so-called untethered licenses will be made available to mobile operators. Many of the advertising restrictions favored by the senate have been struck off, with the responsibility for ad restrictions left up to the Massachusetts regulator.

In a victory for the house, college sports betting will also be allowed in the state, however this will be restricted to all non-Massachusetts based colleges only.