Sep 26, 2022 - Sports

Massachusetts hits sports betting snag

Chris Cipolla of Draft Kings, right, speaks at a podium in front of members of the Massachusetts Gaming Commission, left.

DraftKings' Chris Cippola, right, speaks before the Massachusetts Gaming Commission. Photo: Steph Solis/Axios

Massachusetts regulators are wrestling with a gap in the new sports betting legalization law.

What's happening: The law allows for temporary licenses, but doesn't cap them or stipulate how they should be awarded.

  • Meanwhile, it limits the number of permanent sports betting licenses for casinos, simulcast horse race tracks and mobile sportsbooks to roughly a dozen.
  • Regulators are debating whether to issue more temporary licenses than permanent ones and are considering what would happen if a sportsbook were denied a permanent license and had to close post-launch.

Why it matters: The NFL season is in full swing and fans are eager to place bets in Massachusetts, which would bring in tax revenue.

  • But the gap in the law raises more questions for commissioners that need to be answered before they can start awarding licenses and letting people place bets.

Details: Karen Wells, executive director of the Massachusetts Gaming Commission, cautioned commissioners in a letter against issuing more temporary licenses than what they can issue permanently without a regulatory process in place.

  • It's not clear whether the commission can cap temporary licenses, says Massachusetts Gaming Commission chairperson Cathy Judd-Stein.
  • "It's a question that we have certainly raised. Ideally, if that was really what we wanted to engage in, it would require a legislative fix," Judd-Stein told reporters last week, adding that she was only speaking for herself, not the entire commission.
  • But the odds of getting lawmakers to do anything after July 31, the unofficial end of the legislative session, are slim.

By issuing an unlimited number of temporary licenses, everyone gets a chance to compete and work out the kinks while regulators decide who should stay, said Chris Cipolla, senior director of legal and government affairs for Boston-based Draft Kings, at a commission meeting Thursday.

The other side: Many customers place bets months in advance, and those wagers would be difficult to manage for temporarily authorized sportsbooks that are denied a permanent license, says Justin Smith, legal counsel for Bally's Interactive.

  • Representatives for Penn Interactive, Hard Rock Digital and FanDuel raised similar concerns.

Zoom out: More than 30 states and Washington, D.C., have legalized sports betting since the Supreme Court overturned the law restricting it in 2018.

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