Massachusetts Set To Explore Comprehensive Online Gambling Expansion In 2016

January 4, 2016
Massachusetts Set To Explore Comprehensive Online Gambling Expansion In 2016

With daily fantasy sports now on the radars of lawmakers, there is a movement afoot in statehouses across the country to pass comprehensive online gaming reform packages.

California is the latest state to switch to this comprehensive approach, instead of the piecemeal approach states have previously adopted, and it looks like Pennsylvania will be doing the same in early 2016.

Yet another state that appears to be taking this approach is Massachusetts.

Massachusetts has been flirting with online poker, online casino, and online lottery expansion for several years, but these efforts haven’t progressed much beyond the talking phase, with only a handful of bills (none of which were acted upon), and a couple of informal hearings to show for their efforts.

However, now that the state is leading the way on daily fantasy sports regulation, some of the pro-online gaming forces in the state are trying to roll DFS, iGaming and iLottery into one neat package and kill two, or maybe three, birds with one stone.

“Would it make sense for the Legislature to try to craft an omnibus regulatory bill for all of these new electronic gaming technologies – because there’s so many of them?” Massachusetts Gaming Commission Chairman Stephen Crosby at a December forum. “If they could craft a bill, which incorporated regulatory priorities, fundamental values, whatever, that could be applied to all of these games – e-sports, [daily fantasy sports], online poker, whatever all the new ones are – maybe then they could give it to some agency to implement, and the agency does the grunt work every six months making it apply to whatever the new technology is.”

What could be tackled by the Massachusetts legislature in 2016

DFS is already on the agenda, and regulations should be crafted and ready to go sooner rather than later. Attorney General Maura Healey’s proposed regulations provide a solid regulatory framework, but the finished product will require input from the DFS industry, as well as considering the findings of the Massachusetts Gaming Commission’s white paper authorized in 2015, which expected to be submitted in early 2016.

Unlike the efforts in Pennsylvania and California, and despite Crosby’s thoughts on an omnibus package that includes DFS, because it’s nearing the finish line, it’s likely DFS will be handled individually in Massachusetts. Any other gaming expansion efforts the state considers could be combined into an omnibus package and piggyback off of DFS’s progress.

Online poker and casino games

With the attention DFS is now receiving, there has been a renewed push by State Senator Bruce Tarr to introduce legislation that would allow the state’s three casinos (two of which are still in the construction phase) to offer online poker and online casino games.

Tarr is still in the preliminary phase of floating the legislation around the statehouse in order to gauge its potential level of support. But with DFS regulations in the pipeline, and the lottery making a serious push to take some of its offerings online, the timing could be perfect for Tarr’s bill to finally move past the talking stage.

The lottery’s omnibus approach

As noted above, the idea of an omnibus style bill was first raised by Chairman Stephen Crosby at a DFS educational forum hosted by the Massachusetts Gaming Commission in December. The chatter has only increased since then, culminating with the state lottery commission soliciting proposals from iLottery providers last week.

According to a report in the Lowell Sun, the Massachusetts Lottery Commission formally requested potential applicants to, “submit proposals for the development, implementation, operational support, and maintenance of a Massachusetts Lottery iLottery System … and the development and integration of digital versions of existing and new lottery games (‘Lottery Games’), including but not limited to social gaming and daily fantasy sports options.”

The Lowell Sun is also reporting that the request is looking for, “gaming systems that allow for cross-pollination between online applications and physical retailer space and any other progressive gaming opportunities that may be available.”

Earlier in December the MLC proposed adding a daily fantasy sports-style game to its offerings, as MLC Executive Director Michael Sweeney called DFS, the “biggest current challenge” the lottery is facing.

This is a pretty dramatic shift from previous positions and concerns held by Massachusetts lawmakers and many at the MLC that online would have a cannibalistic effect on the state’s brick & mortar lottery retailers. State Treasurer Deb Goldberg, whose office oversees the lottery, has warned lawmakers that the current level of lottery sales (particularly keno and scratch tickets) is unlikely to last if the lottery doesn’t adapt to the changing landscape and bring in younger players.

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