Metro
    Next Score View the next score

    Sports gambling case has Massachusetts casinos at the ready

    Said Stephen Crosby (above), chairman of the Massachusetts Gaming Commission, on sports gambling: “If the Legislature wants to move quickly, we’d like to tee it up for them and say, ‘Here’s what the issues are.’ ”
    John Blanding/Globe Staff/File 2016
    Said Stephen Crosby (above), chairman of the Massachusetts Gaming Commission, on sports gambling: “If the Legislature wants to move quickly, we’d like to tee it up for them and say, ‘Here’s what the issues are.’ ”

    The odds are fairly good that the Massachusetts gambling market could significantly change even before all of the state’s casinos are open.

    As resort casinos are being built in Springfield and Everett, gambling companies and regulators are preparing for the possibility that the US Supreme Court this spring will strike down a 1992 federal ban on sports betting, permitting all states to legalize — and tax — sports books.

    That would make legal sports betting, now almost exclusive to Nevada, the next front in the fierce regional competition for casino patrons and their money.

    Advertisement

    “There are a lot of states that are going to jump on this,” predicted I. Nelson Rose, an international expert on gambling law from Whittier Law School in Southern California.

    Get Metro Headlines in your inbox:
    The 10 top local news stories from metro Boston and around New England delivered daily.
    Thank you for signing up! Sign up for more newsletters here

    While not exactly jumping, officials in Massachusetts are closely following the Supreme Court case, brought by New Jersey. Even if the court opens sports betting to more states, Massachusetts would still have to approve legislation before sports fans could legally bet here.

    “There is a school of thought that there’s going to be a competitive situation,” said Stephen Crosby, chairman of the Massachusetts Gaming Commission, which regulates the state’s fledgling casino industry. “Which states are going to get going and try to get a piece of this action? If the Legislature wants to move quickly, we’d like to tee it up for them and say, ‘Here’s what the issues are.’ ”

    To do that, the commission’s staff is preparing a briefing paper for state lawmakers that will lay out the range of potential outcomes from the Supreme Court case, he said.

    Among the three casino operators licensed in Massachusetts, Penn National Gaming is the most enthusiastic about the prospect of taking sports bets here — or at least the company most open about its enthusiasm.

    Advertisement

    Penn National, which runs the Plainridge Park slots parlor off Interstate 495 in Plainville, has been part of a sports betting task force organized by the American Gaming Association, the casino industry’s trade group, said Penn National senior vice president Eric Schippers. Some states “that want to hit the ground running” are already working on legislation to be ready if the Supreme Court clears the way for sports gambling nationwide, he said.

    Schippers confirmed the company would be interested in adding a Massachusetts sports book if such gambling became legal here.

    Sports bets would not generate huge new profits for casinos or a tax windfall for the state, but they “can be an amenity for casinos to remain competitive in the regional arms race,” he said.

    Wynn Resorts, which is building a $2.4 billion hotel and casino on the Mystic River in Everett, is “watching the court case with interest,” said Robert DeSalvio, president of Wynn Boston Harbor, which is scheduled to open in about 18 months.

    “Our industry supports legalized and regulated sports betting, but the ultimate decision rests with the courts, state and federal lawmakers, and the Massachusetts Gaming Commission,” DeSalvio said in a statement.

    Advertisement

    MGM Resorts, which is building a $950 million casino in downtown Springfield scheduled to open in 2018, declined to comment.

    All three companies own properties in Nevada that take sports bets.

    While waiting for the ruling, Massachusetts officials are cooperating with gambling regulators from other states, in an informal group coordinated through the University of Nevada Las Vegas, Crosby said.

    “Everybody just agrees this is going to be a new hand grenade coming over the wall into their jurisdictions, and nobody knows how to handle it except for New Jersey,” which has been studying the regulatory issues for years, Crosby said. “We’re trying to figure out, ‘Can we piggyback on them?’ We don’t want to have, as we do in [casino] gaming, a whole bunch of different jurisdictions with different regulatory requirements. We’re trying to figure out if we can standardize going forward.”

    Crosby said he doubts the commission will take a formal stand on sports betting since the decision lies with legislators.

    The choice has clear parallels to the decision to allow casinos in the first place, he said. “It will boil down to the same thing, in a way, that it boiled down to with [whether to legalize] casinos. We had a billion dollars a year bet in other states. With sports betting, we have X millions of dollars — however much it is — and it’s all being done illegally.

    “Not only is the state not getting any of it, it’s not safe and it’s not regulated. The argument would be, ‘Is it better to be more aggressive in trying to stop it? Or it is better to legalize it, regulate it, and take a piece of the action?’ ”

    The case before the Supreme Court was brought by outgoing New Jersey Governor Chris Christie, who has been trying for years to bring sports gambling to Atlantic City casinos, which have been ravaged by regional competition. New Jersey has been stymied by an obscure 1992 law, the Professional and Amateur Sports Protection Act, known as PASPA, which essentially prohibits states — other than Nevada and three others that were grandfathered — from legalizing sports betting.

    New Jersey has argued that the law requires the state to do something it opposes: Keep sports betting illegal. That violates the 10th Amendment’s protection of state’s rights, it contends.

    Rose, the gambling law expert, said a majority of the court appears ready to do something with the Sports Protection Act, but exactly what is unclear. It could issue a broad ruling on states’ rights and federalism that affects issues beyond just sports gambling or a narrower decision that might work for New Jersey but would complicate the abilities of states to regulate sports gambling — or something else.

    “You could have five different decisions,” he said.

    Proponents of striking down the law, such as the American Gaming Association, estimate that Americans illegally bet $150 billion on sports each year. The ban on legalized sports books “thus had the perverse effect of pushing an enormous market underground by way of federal decree while stamping out state and local efforts to adapt their own laws pursuant to their own citizens’ wishes,” the AGA wrote in a brief to the court.

    Gambling opponents cast doubt on casino industry estimates on the size of the illegal sports betting market and warn that legalizing sports betting would have a corrosive effect.

    In other countries with pervasive legalized sports betting, kids “begin to see gambling and sports as one in the same,” said Les Bernal, national director of Stop Predatory Gambling, an advocacy group that opposes commercialized gambling.

    “It changes the experience of sports,’’ Bernal said. “It begins to turn professional sports into a fleecing operation.”

    In 2016, Americans lost about $117 billion on “government-sponsored gambling schemes,” Bernal said, which he called a massive transfer of wealth, in many cases from working people to wealthy casino companies.

    “Allowing states to license sports gambling would make it even worse,” he said.

    Mark Arsenault can be reached at mark.arsenault@globe.com. Follow him on Twitter @BostonGlobeMark.