Bettors and sports fans are eager for legal sports betting to get up and running in Massachusetts. But regulators said Thursday that a quirk in the new law is preventing the state’s Gaming Commission from laying out a timeline for its start.
The sports betting law signed by Gov. Charlie Baker in early August allows the Gaming Commission to issue sports betting licenses for the state’s slots parlor, casinos and simulcast centers to take in-person bets. The law also allows those facilities to partner with mobile operators and for licenses to go to as many as seven other independent companies for mobile sports betting apps.
The law further indicates temporary licenses may be issued for sports wagering operations. While untethered mobile licenses are capped at seven, the Legislature did not include a limit on the number of temporary licenses.
With at least 30 operators expected to apply for those seven licenses, commission officials worry what will happen to dozens of operators that may qualify for temporary licenses. Those would last up to a year and cost the companies a $1 million fee each. After taking bets in Massachusetts, the companies would likely have to shut down once the seven official mobile-only licensees are chosen.
Executive Director Karen Wells said that as many as 76% of temporary license holders ultimately could be required to end their businesses in the state.
“This structure, and this disconnect, poses complications for both the regulator and the licensee themselves, and it also presents consumer protection concerns for the public,” Wells said.
On the consumer protection front, Wells said there would be “inevitable confusion in the marketplace” if or when betting platforms with temporary licenses suddenly cease operations.
She highlighted other possible issues: How could the commission ensure players get any money left in their accounts returned? What would happen if an operator is shut down before the outcome of a bet it accepted is known? Should companies be required to put up a bond to ensure they can pay out all wagers if they don’t secure a final license?
“The idea of having to issue notices to honorably operating businesses that just didn’t happen to make our final cut of up to seven is just untenable to me,” Chairwoman Cathy Judd-Stein said.
Judd-Stein hopes to get more information next Thursday when the commission holds a roundtable discussion with potential mobile-only applicants at the State House.
“Next Thursday, when we will hear from every interested operator on these matters, might shed some light, might shed some consensus and also may come up with a solution we’re not thinking about. And I’m crossing my fingers on that front,” Judd-Stein said.
Some commissioners hope next week’s roundtable will get them closer to an answer to the question on bettors’ lips: “When can I place a legal bet?”
Judd-Stein and Commissioner Eileen O’Brien both said they think the commission could have already produced a timeline for the start of legal wagering if it was not for the questions around temporary licensure.