Lawmakers caught up in collision of online gaming, gambling – SouthCoastToday.com

By Colin A. Young, State House News Service

BOSTON As the commission looking into online gaming and online gambling presses ahead in its study of ways to regulate and possibly make money from the developing industries, the Massachusetts Lottery is concerned that it could be left behind.

The Lottery is seeking authority from the Legislature to offer its current products scratch tickets, draw games, Keno and more to customers over the internet, arguing that its survival and the hundreds of millions of dollars it returns as local aid are otherwise at risk.

Meanwhile, a special commission formed by the Legislature is looking into legalizing and regulating fantasy sports, eSports and non-Lottery online gaming, and has been tasked with making recommendations for legislation by July 31.

The two interests collided Tuesday: the Lottery Commission met at 10:30 a.m., and commissioners and staff noted that the Special Commission on Online Gaming, Fantasy Sports Gaming and Daily Fantasy Sports had scheduled a hearing for 11 a.m.

After the monthly Lottery sales report, discussion among the commissioners turned briefly to the possibility that Massachusetts could begin to allow online gambling. Keying off media appearances by Gaming Commission Chairman Stephen Crosby, Treasurer Deborah Goldberg raised concerns about that possibility.

"It's interesting. You're hearing about the Gaming Commission saying they want online gambling, and then the comment that I read in the paper was that there are only so many entertainment dollars," Goldberg said. "So literally ... if they get online gambling and we do not get iLottery, they would be trying to capture our money that goes to cities and towns for the profit of a profitable entity, like Wynn or MGM."

Crosby, who serves on the Special Commission on Online Gaming, Fantasy Sports Gaming and Daily Fantasy Sports, said Monday on WGBH that the Gaming Commission has no position on whether online gaming should be legal, but does have thoughts on how to regulate it if it's made legal.

"The Gaming Commission has been absolutely emphatic that there is a two-step process here. One is, should online gaming be legal in Massachusetts? That's not up to us, that's up to the Legislature, pure and simple," Crosby told Great Boston host Jim Braude. "If it is legal, then we definitely have opinions on how it should be done and we've made recommendations. But we're not lobbying in favor, nor are we against it. That's not a decision for us to make."

Crosby previously told the special commission that online gaming could become "another modest but real economic engine" for Massachusetts if "you have a stable legal environment, where the law was clear and the parameters were clear and the rules of the road were clear, people would come here to develop new games."

Though the special commission has until July 31 to make recommendations to the Legislature and the chairwoman of the commission said Tuesday she expects the commission to work up to that deadline, the notion that lawmakers could authorize online casino gambling but not online Lottery products struck a nerve with the Lottery Commission.

"As the apolitical and independent comptroller of Massachusetts, I have to tell you that that's enormously disturbing to me, from the standpoint that you have the most successful lottery in the nation, and what you're really doing is not only kneecapping it from the standpoint of not allowing it to participate in any kind of online way, but also you're literally, as the treasurer said, handing the keys over to private industry," Comptroller Thomas Shack, a member of the Lottery Commission, said.

Shack added, "To take those revenues away from cities and towns and to then share them in a significant way with private industry just goes against what we're designed to do as a commonwealth and as a lottery."

The special commission heard Tuesday from experts in online gaming legal and regulatory structures, online game technology and security, and from Marty "Lazerchicken" Strenczewilk, the owner and CEO of eSports team Splyce.

After the hearing, Chairwoman Sen. Eileen Donoghue said she thinks the commission has a lot of work left to do before it decides what it should recommend to the Legislature.

"The more we get into it, I think the more we can appreciate how enormous this task is, to look at all three sectors fantasy sports, online gaming and eSports and any one of them could be daunting," the Lowell Democrat said. "But my sense is we have a ways to go in terms of our research, in hearing the information and then deciding what is the appropriate action to take. And it may not be one size fits all, that's something...we'll see as we go forward."

When asked about the possibility that the Legislature could approve one form of online wagering but not another, Donoghue declined to comment, citing the fact that the Lottery is expressly excluded from the special commission's focus.

Last year, the Senate voted 22-17 to give the Lottery the authority to move online but the matter was never taken up in the House. This year, Goldberg has filed legislation (H 26) to allow the Lottery to sell online, and Lottery Executive Director Michael Sweeney has touted the importance of being online, especially if casinos or other private companies will be allowed to offer online gambling.

"If the Massachusetts Lottery is not allowed to take a significant step into that online world, we will never be able to compete with the advertising dollars that the private casino industry will pour into that effort, if they're allowed to go online," he said Tuesday. "So establishing the brand online, establishing the Lottery's presence online, to me it's really, really critical."

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Lawmakers caught up in collision of online gaming, gambling - SouthCoastToday.com