AMHERST, Mass. (WWLP) – Legal sports betting in Massachusetts is expected to have “far less impact economically” than the state’s two other legal types of gambling, which are casinos and the lottery, according to a study by researchers with the University of Massachusetts-based SEIGMA project. SEIGMA stands for Social and Economic Impacts of Gambling in Massachusetts.
Massachusetts became the 36th state to legalize sports betting when Governor Charlie Baker signed the Legislature’s bill into law in August. The SEIGMA report, which was presented on September 8, was ordered by the Massachusetts Gaming Commission (MGC) as it creates the licensing process and the rules and regulations to move out sports betting in the Commonwealth.
“For the last several years, the Massachusetts Gaming Commission has been monitoring proposals that would legalize sports wagering and designate the MGC as a regulator in Massachusetts,” says MGC Chair Cathy Judd-Stein. “The MGC saw the potential of sports wagering and requested this study be undertaken in November 2021 in anticipation of being tasked with regulating the industry. This report will aid the MGC as we begin to regulate a sports wagering industry in the Commonwealth with an uncompromising focus on integrity and player safety.”
In the U.S. sports betting has developed rapidly in sweeping and diverse ways across the nation since being legalized in 2018 by a Supreme Court ruling. Its social and economic impacts are still largely unclear, however.
“We were trying to give a very broad overview of what is known at this point about the social and economic impact of sports betting, and it’s the first nationwide effort to do that,” says lead author Rachel Volberg, research professor in the School of Public Health and Health Sciences and SEIGMA’s principal investigator. “It also summarizes what we know about sports betting in Massachusetts.”
The tax revenue from legal sports betting in Massachusetts is anywhere between $8.6 million and $63 million annually, depending on the tax rate scenarios, which pales in comparison to the $1.1 billion in revenues from the lottery and $168 million from casinos in 2019.
Even though sports betting is not yet legally offered here in Massachusetts, the researchers found “a substantial increase” in sports betting participation in an online panel survey in March 2022, compared to eight years ago. Volberg, emphasizing that the online panel is not representative of the population, attributes the increase to the legalization of daily fantasy sports in Massachusetts and a nationwide flood of sports betting advertising.
“While it is likely that sports book operators, including land-based and online operators, will benefit from sports betting legalization in Massachusetts, it is difficult to predict whether sports bettors will add legal sports betting to their repertoire or simply substitute betting on sports for spending on other types of gambling,” states the report.
Volberg states that only four states have funded any kind of research about sports betting, while 12 have provided funding for problem-gambling services. Massachusetts is different because 9% of the tax revenue raised from sports betting will go into the Public Health Trust Fund which supports the rigorous research agenda and services to mitigate gambling-related harms.