Rolling the Dice

Rolling the Dice

Coverage of casino licensing and the gambling referendum

My bet is Vineyard gaming is coming

My bet is Vineyard gaming is coming

Legal challenges just delaying inevitable

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THE PURSUIT of a casino by the Aquinnah Wampanoag Tribe on Martha’s Vineyard may be one of the most under-covered stories in Massachusetts.

The tribe is trying to open a so-called Class II gaming facility, which is typically referred to as a high-stakes bingo operation. It is bingo, but not with balls dropping and people yelling out they’ve won. Instead, players sit at individual machines and play games that look and feel like those on regular slot machines, but they are programmed differently. Instead of playing against the “house,” as in a regular Class III casino, you are playing against other players in the same gaming facility, almost mimicking a card-based bingo game.

The tribe decided to construct a Class II facility because, under the Indian Gaming Regulatory Act of 1988, Class II gaming is allowed as a matter of right, and does not require a compact or agreement with the Commonwealth.

The tribe has been trying since the 1970s to get its facility up and running, and it’s getting pretty close despite the efforts of state and local officials to block it. My suggestion to state and local officials would be to get on board soon. Unlike the casino pursuit of the Mashpee Wampanoag Tribe, which revolves around the question of lands in trust and if the tribe will be able to open a casino; for the Aquinnah Wampanoags, the question is when they will be able to open a casino.

Here’s some background. In the late 1970s, the Aquinnah Wampanoag Tribe filed a lawsuit against the Commonwealth of Massachusetts and the town of Aquinnah (or Gay Head, as it was named back then) claiming title to certain aboriginal lands on the island of Martha’s Vineyard.  In 1983, the tribe and the Commonwealth, the town, and the Aquinnah/Gay Head Community Association entered into a settlement agreement, under which the town agreed to transfer ownership to several hundred acres of land in exchange for the tribe’s release of claims on other aboriginal lands on Martha’s Vineyard.  The settlement agreement was approved by the Bureau of Indian Affairs and, in 1987, Congress enacted legislation codifying the terms of the settlement agreement.

In 2013, the tribe received an opinion from the National Indian Gaming Commission that concluded the lands received under the settlement agreement were eligible for tribal gaming under the Indian Gaming Regulatory Act.  The tribe then informed the town and the state that it would be starting construction on a Class II facility.

The Commonwealth, the town, and the Aquinnah/Gay Head Community Association filed suit, and in 2017 they prevailed in US District Court. The tribe appealed, and won. The appeals court concluded that the settlement lands were eligible for gaming under federal law and that the tribe could move forward with its planned Class II gaming facility. The Commonwealth, the town, and the association appealed this decision to the US Supreme Court, but the court declined to consider the case.

The tribe then began construction of its gaming facility, but it didn’t take long before it encountered new roadblocks. When the tribe applied to the town for a routine electrical permit, the request was rejected and the local electric utility disconnected service to the construction site. The town went back to US District Court, seeking to assert its regulatory authority over the project.  The district court agreed with the town and placed the tribal lands under the Town’s jurisdiction for permitting and zoning authority. The tribe then appealed that decision to the First Circuit Court of Appeals, which recently held a hearing on the issue.

Scott Crowell, an attorney who represents the Aquinnah Wampanoag Tribe, said in his closing statement that unless the lower court ruling is overturned local officials would be able to kill the gaming facility with a 1,000 cuts. “There is no tribe operating a Class II gaming facility [in the United States] that is subject to county or local zoning laws, and this will make Aquinnah an aberration,” he said. “The ability for the town to interfere and do indirectly what it can’t do directly is the interference that makes the application of town laws inapplicable.”

Crowell’s argument seemed persuasive. One thing to keep in mind is that there is no agreement in place to siphon a portion of any future gaming revenue to Martha’s Vineyard or the state. An agreement was drafted back in the 1990s but never ratified because the Bureau of Indian Affairs deemed the proposed 25 percent revenue share with the state too generous.

If the tribe prevails, a gaming facility could open on Martha’s Vineyard and the state could end up with nothing. My advice would be to all parties would be to put the legal bickering to rest, and strike some sort of deal.

Paul L. DeBole is assistant professor of political science at Lasell University.

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MGM Springfield lays off 1,000 employees

MGM Springfield lays off 1,000 employees

Number of workers cut in half, revenue down significantly

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MGM SPRINGFIELD is laying off 1,000 already furloughed employees as part of nationwide cuts by its parent company that resulted in 18,000 total layoffs on Friday.

The workers have been on a temporary furlough that started in March, when the coronavirus pandemic forced casinos to shut down.

“While we have safely resumed operations at many of our properties and have returned tens of thousands of our colleagues to work, our industry – and country – continues to be impacted by the pandemic, and we have not returned to full operating capacity,” wrote MGM CEO and President Bill Hornbuckle in a letter to employees.

The casino was shuttered from March until July, when it reopened with 700 hundred employees. Another 100 workers have been added since then.

The 2-year old casino had 2,000 employees in December, according to company data. MGM had initially told the state’s Gaming Commission that it would have 3,000 people on payroll.

The hotel for the casino remains closed, according to the company.

“Due to the mandated capacity restrictions and business demand, many of our amenities and venues remain closed for the time being. With these positions currently unavailable, it has not been possible to bring back all of our team members,” said Chris Kelley, president and chief operating officer at MGM Springfield in a letter to workers.

State rules intended to stem the spread of the virus have limited events and game availability that are usually big money makers.

The employees have been furloughed without pay since April. Friday is the legal deadline imposed by the federal WARN Act that requires furloughed employees to be updated on their positions or be formally laid off from their jobs.

A spokeswoman for the company said that the affected workers will still be on a call list in the event the economic situation improves. If they’re hired back before the end of the year, they can retain seniority and reclaim their former positions. Their health insurance benefits have been extended through Sept. 30.

The resort and casino are currently operating at about one-third of normal capacity, as tourism and gambling industries continue to be hit hard by the virus.

The gross gambling receipts for the casino were $10.7 million from July 10, when the casino reopened, to July 31. That figure was over $21 million in February 2020, before Gov. Charlie Baker began closing businesses.

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Casino slot revenues off to a strong start

Casino slot revenues off to a strong start

On a per-machine basis, Plainridge leads way

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GAMING IS BACK in Massachusetts and the casinos are open and ready for business and patrons appear to be ready, willing, and able to play.  Plainridge Park reopened on July 8 and both MGM Springfield and Encore Boston Harbor reopened on July 10.  We now have some gaming revenue numbers to examine and try to figure out what they mean.

When we talk about monthly slot revenue numbers, the first thing that we need to do is to compare apples to apples and oranges to oranges.  The only way to properly do that is to divide the total monthly slot revenue by the number of gaming days and then by the number of machines.  This gives you an average daily revenue per machine, expressed as pmd, or per machine day.

Both MGM Springfield and Encore Boston Harbor opened on July 10 and were in continuous operation for 22 days. Plainridge Park, a slots-only facility, opened on July 8, but closes from 2 a.m. to 7 a.m. on Sundays through Thursdays, and is open continuously on Fridays and Saturdays, which yields 20.46 days of continuous operation in July.  Because of social distancing concerns, a number of machines at each facility are closed.  For Plainridge Park, which normally has either 12,50 or 1,500 slot machines (depending on how you count multiplayer virtual blackjack, roulette, and poker machines), the facility has an average of 789 machines in operation.  Similarly, MGM Springfield, which normally has 2,550 slot machines, now has an average of 892 machines in operation (34.98 percent of the total) and Encore Boston Harbor, which normally has 3,158 machines, now has an average of 1,856 machines in operation (58.77 percent of the total).

Massachusetts Slot Revenues

July 2020

 

Gaming Venue Gaming Days Slot Revenue No. of Machines Machine Revenue (per day)
Plainridge Park 20.46 7,740,863.58 789 479.56
MGM Springfield 22 8,988,609.85 892 458.04
Encore Boston Harbor 22 16,266,468.65 1856 398.38

Using machine revenue per day as a yardstick, Plainridge Park leads the pack with $479.56 per machine per day, which is a great number.  Anything above $300 per machine per day, according to the gaming industry standard, is strong and an indicator of a healthy gaming market.  When pmd numbers get down around $200, operators get concerned about saturation in the region.  Similarly, MGM Springfield is in a strong second place with $458.04 per machine per day.  Encore Boston Harbor is still doing well, but it is in third place at $398.38 per machine per day.

These numbers seem to indicate a large degree of pent-up demand for gaming.  But there are other possible reasons for these high numbers other than the lack of operating gaming facilities for the last 3 ½ months.  For example, one reason for MGM Springfield’s high slot revenue numbers may be the fact that the upstate New York commercial casinos – except for some tribal casinos in western and central New York – remain closed due to COVID concerns.  The Massachusetts slot revenue numbers are still below those for the same period in 2019, but that could be due to the partial month of operations.

As a basis for comparison, Mohegan Sun – which reopened in early June – had $47.5 million in slot revenue in the month of July.  This amount is almost $800,000 above what it earned in July 2019, even though only 2,529, or 61 percent, of its 4,095 slot machines were available. That comes out to nearly $606 per machine per day, a very impressive number.

The major question is will this trend continue?  In the past we have seen huge revenue numbers when a new gaming facility opens, but the numbers tend to decline over time.  Will concerns over COVID and procedures designed to encourage social distancing and limit the spread of the virus cause a more precipitous drop in slot revenues?  Only time will tell.

Paul DeBole is an assistant professor of political science at Lasell University.

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Casino revenues, amid constraints, do fairly well in July

Casino revenues, amid constraints, do fairly well in July

Fewer games, fewer days – 56% of July 2019 revenues

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THE STATE’S THREE CASINOS performed fairly well in July, bringing in 56 percent of the revenue they did in July 2019 despite operating far fewer games and slot machines for fewer days.

The Massachusetts Gaming Commission said on Monday that Encore Boston Harbor in Everett, MGM Springfield,  and Plainridge Park Casino in Plainville brought in nearly $45.4 million in gross gaming revenue between July 10 (July 8 for Plainridge) and July 31 compared to nearly $81 million for the whole month of July in 2019. July 2019 was the first full month the facilities were open.

Encore Boston Harbor’s revenues totaled just under $27 million, or 59 percent of the total, with $10.7 million from table games and $16.3 million from slots. MGM Springfield’s revenues were $10.7 million, with $1.7 million from table games and $9 million from slots. Plainridge brought in $7.7 million from its slot machines.

All three facilities are operating with restrictions on the number of guests and gaming stations. Poker, craps, and roulette games are not allowed. Officials said the three facilities as a group are operating with less than half of their regular gaming positions and the number of guests has rarely hit half of the occupancy levels.

Even so, the facilities managed to bring in 56 percent of the gross gaming revenue they did in July 2019. The state’s tax take followed the same trajectory, as tax revenue of $13.2 million was 56 percent of the $23.3 million collected in July 2019. [CORRECTION: An incorrect tax revenue number was corrected.]

At Encore, the facility is operating with 60 percent of its available slot machines and 32 percent of its table game positions. A smaller percentage of slots and table game positions are open at the other two casinos. Encore’s $27 million in revenue represents 59 percent of the $48.6 million in gross gaming revenues in July 2019.

The three casinos were closed in April, May, and June and part of March due to COVID-19 restrictions. They reopened as part of the Phase 3 of the Baker administration’s reopening plan.

In a conference call with financial analysts on August 4, Matt Maddox, the CEO of Wynn Resorts, described the facility’s slots volume as good — up over last year even with fewer machines. Officials said table game revenue was off 30 percent even as the number of table game positions was down more than 50 percent.

Wynn officials said they have cut operating expenses at the Everett facility from $1.3 million a day to $830,000 a day and should be able to break even if they can bring table game revenue up. “There is more demand than supply for our table games there,” said Craig Billings, the company’s chief financial officer.

Maddox said a major challenge is to bring back non-gambling revenues, which have been hard hit by the pandemic. He said he was proud of the company’s efforts to create a safe environment at its resorts. He noted all employees were tested for COVID-19 before returning to work and 500 to 600 employees are tested every two-weeks as part of a surveillance testing program. He said the company employs 10 contact tracers. As of the conference call, Maddox said 16,750 employees had been tested, 98 percent were negative ,and 2 percent, or 300, were positive. He said contact tracing indicated 99 percent of those who tested negative were exposed outside the casino.

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Las Vegas-style casinos face uncertain future

Las Vegas-style casinos face uncertain future

Encore faces big challenges; slots will bounce back quicker

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THE MASSACHUSETTS CASINO industry faces a long and steep climb back as it prepares to reopen over the coming week, with its opulent centerpiece, the $2.6 billion Encore Boston Harbor, facing a particularly uncertain future.

MGM Springfield and Plainridge Park Casino, which rely heavily on less labor-intensive slot machines, are likely to see a rebound in revenue, but their once proud payrolls may not come back anywhere near as quickly, judging from the reopening experience in Connecticut and other states.

Encore may face more serious challenges, with its main revenue generators – table games and a sizeable retail, nightclub, restaurant and entertainment complex – showing far more vulnerability to the disruptions caused by COVID-19.

The business model of Wynn Resorts’ Everett casino, set to reopen Sunday, is much more akin to casinos in Las Vegas, where the reopening has not gone anywhere near as smoothly, with gaming revenue sputtering amid a fresh spike of coronavirus infections.

Table games are both harder to play amid the various coronavirus safety restrictions and more labor-intensive than slot machines, requiring hundreds of dealers or more.

“The biggest problem I see for Massachusetts is going to be at Encore, with no roulette and a reduced number of people at each table,” said Alan Woinski, president of Gaming USA Corp., an industry consulting and newsletter firm. “It is a table-game-centric market. That is why Las Vegas is having an issue.”

In contrast to most casinos outside of Las Vegas, Wynn’s Encore Boston Harbor relied on table games for at least half of its revenue, and at times significantly more than half, during its first eight months in business since opening late June of 2019, Massachusetts Gaming Commission numbers show.

But when Encore Boston Harbor reopens, table games will be severely restricted under new, coronavirus safety rules. No poker, roulette, or craps (a dice game) will be allowed, while blackjack tables will be limited to three players, with everyone separated by Plexiglas partitions.

Wynn Resorts has not yet offered any update on its revenues at its two Las Vegas casinos, which reopened in June, but a regulatory filing by rival Caesars Entertainment offers a glimpse at the challenges faced by more table-game reliant casinos.

Through June 10, revenue at Caesars’ five Nevada casinos plunged 56 percent to 58 percent from the year-earlier periods. Operating income took an even bigger hit, falling 110 percent to 120 percent, the company stated in a filing with the US Securities and Exchange Commission.

By contrast, regional casinos that rely on slot machines have seen a modest rebound in revenue, a development that may bode better for the bottom lines of the MGM Springfield, set to reopen on July 13, and Plainridge, slated to resume business on Wednesday.

Plainridge relies solely on slot machines, while MGM Springfield in January reported that roughly three quarters of the $20.6 million in gaming revenue it generated that month came from slot machines.

Both Mohegan and Foxwoods have reported seeing an influx of customers since they reopened at the beginning of June, despite plastic partitions separating players and dealers on table games, requirements that customers and employees wear masks, and temperature checks.

Mohegan Sun reported a 10 percent jump in slot machine revenue during the first two weeks in June, compared to the same period in 2019, according to an SEC filing.

Foxwoods has seen revenue comparable with the same period last year, and with a significant part of its gambling operations still shut down.

Through June 24, Foxwoods contributed $6.7 million to state coffers in Connecticut through its 25 percent slot machine revenue-sharing agreement. While Foxwoods has not reported overall slot revenue stats, that pencils out to overall slot revenue of $26.8 million for the first three weeks of the month and a projected $33.5 million for the entire month.

That is somewhat below the $35.3 million in overall slot revenue Foxwoods generated in June 2019.

A visit on a recent Tuesday night found the casino doing a brisk business.

An older couple from Rhode Island sipped coffee on a bench by a row of shops, taking a break from playing the slots, while nearby, Richard Lane, a business major at Curry College in Milton, fretted over people gambling away unemployment checks while marveling at his own luck.

“I am up $2,000 and I am not going to stop,” Lane said.

But whether they rely on table games and high rollers, or slot machines and the mass market, casinos across the board are employing far fewer people than they were a few months ago, and with no signs of any imminent rebound in staffing levels.

When Encore opened last June, it had a staff of 4,800 and was still on the hunt for hundreds of additional employees.

Encore Boston Harbor recently put 3,000 employees on indefinite furlough.

MGM Springfield informed state labor officials in May it might have to lay off nearly 1,900 of its 2,500 workers over the summer.

Officials at MGM Springfield declined to comment on staffing plans at the casino.

Plainridge’s employees were furloughed in April, along with 26,000 other employees at racinos and casinos around the country owned by corporate parent Penn National. The relatively small casino on the Rhode Island border in Plainville had just over 500 employees, according to a report filed last year with the Massachusetts Gaming  Commission.

The experience of casinos in Connecticut and other states that have been open for the past five weeks point to no immediate rebound in payrolls, which remain a shadow of what they once were.

Foxwoods has said it has recalled 2,000 employees, roughly a third of its pre-pandemic workforce, according to a spokesperson for the casino.

Mohegan Sun has brought back roughly half of its workforce, or roughly 2,500, said Mario Kontomerkos, president and chief executive officer of Mohegan Sun’s corporate parent, Mohegan Gaming & Entertainment.

Kontomerkos was not able to give a timeline for when, or if, Mohegan Sun would return to its pre-pandemic staffing levels

While encouraged by the results so far of reopening, Kontomerkos said bringing back additional staff is linked with reopening amenities. While restaurants and shops have been reopening, and the casino’s hotel is operating at two-thirds capacity, the timeline for reopening the 10,000-seat Mohegan Sun Arena remains unclear and will likely be part of the last phase, he said.

“We are definitely seeing an increase of visitation,” Kontomerkos said. “We are looking forward to bringing back as many of our employees as we can and to the extent the market dictates.”

Overall, the hospitality and leisure sectors, of which casinos are one part, have been the hardest hit by the coronavirus and the economic downturn, noted Victor Matheson, an economics professor at Holy Cross and an expert on gaming and lotteries.

“It’s leisure and hospitality that has been the one sector that has been decimated more than any other sector, losing half of its employment nationwide,” Matheson said. “That has been one sector that has been crushed.”

And so far, many regional casino operators aren’t facing heavy pressure to ramp back up to their pre-crisis payroll levels, having managed to significantly boost profit margins by relying on fewer staff, something made easier by their reliance on slot machines.

At Mohegan Sun, operating income rose faster, at 15 percent, than overall gaming revenue.

Caesars Entertainment’s regional casinos, scattered across the Gulf Coast, Missouri, and Iowa, reported revenue for the first 10 days of June that was flat to up 2 percent, even as operating income soared 60 percent to 70 percent over the year-earlier period, the company reported.

“This is a permanent change for the industry,” Gaming USA’s Woinski said. “We are going to see lower staffing levels going forward.”

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Tribe says US took its land out of trust

Tribe says US took its land out of trust

Cromwell: Action by Interior secretary cruel and unnecessary

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Following is a statement posted on the Mashpee Wampanoag Tribe website on Friday.

At 4:00 pm today — on the very day that the United States has reached a record 100,000 confirmed cases of the coronavirus and our Tribe is desperately struggling with responding to this devastating pandemic — the Bureau of Indian Affairs informed me that the Secretary of the Interior has ordered that our reservation be disestablished and that our land be taken out of trust.  Not since the termination era of the mid-twentieth century has a Secretary taken action to disestablish a reservation.

Today’s action was cruel and it was unnecessary. The Secretary is under no court order to take our land out of trust.  He is fully aware that litigation to uphold our status as a tribe eligible for the benefits of the Indian Reorganization Act is ongoing.

It begs the question, what is driving our federal trustee’s crusade against our reservation?

Regardless of the answer, we the People of the First Light have lived here since before there was a Secretary of the Interior, since before there was a State of Massachusetts, since before the Pilgrims arrived 400 years ago.  We have survived, we will continue to survive.  These are our lands, these are the lands of our ancestors, and these will be the lands of our grandchildren.  This Administration has come and it will go.  But we will be here, always.  And we will not rest until we are treated equally with other federally recognized tribes and the status of our reservation is confirmed.

I will continue to provide updates on this important issue in the coming days as we take action to prevent the loss of our trust status.

Kutâputunumuw

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Sports betting bill in play on Beacon Hill

Sports betting bill in play on Beacon Hill

Gambling on pro, college games would be allowed

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STATE HOUSE NEWS SERVICE

Adults in Massachusetts would be able to bet on professional and Division I college sports in person and through web or mobile apps under legislation released Friday by a legislative panel that’s been studying sports betting for a year.

The Massachusetts Gaming Commission would be given the discretion to write the actual rules for sports wagering, but the Joint Committee on Economic Development and Emerging Technologies envisions a betting ecosystem that could include the state’s resort casinos, the lone slots parlor, tracks with live horse racing, and as many as five online-only operators.

Bettors would have to be at least 21 years old and be physically present in Massachusetts.

While 17 other states, including neighboring Rhode Island and New Hampshire, have already authorized gamblers to place legal bets on sports, Massachusetts has been considering whether to similarly legalize betting since the US Supreme Court in May 2018 ruled that the nearly-nationwide prohibition on sports wagering was unconstitutional and gave states the ability to legalize the activity.

“We didn’t rush this process. We took a very deliberative approach, recognizing that there were goals to this legislation and above all else was to protect the consumer and the taxpayer. We always said that we wanted to be in the black on this bill and not suffer losses like other states have done,” Rep. Ann-Margaret Ferrante, House chair of the committee, said on Friday.

“The second thing was that we wanted to make sure we put protections in for athletes and recognizing that bets are usually taken on horses and, in some states, dogs and other animals. With people, we really stepped back and said, ‘what provisions can we give the people who participate in these sports and especially for the college athletes?'”

Gov. Charlie Baker last year proposed a bill that would allow betting at licensed casinos in Massachusetts and through online platforms like Boston-based DraftKings. A slew of lawmakers proposed similar legislation.

With four months remaining for the Legislature to conduct significant business, the issue of sports betting could now vault onto lawmakers’ to-do lists alongside the state budget, a tax-hiking transportation bill, health care legislation and an expected economic development bill.

The legislation, crafted after a two-day hearing last May and months of research on betting laws and regulations in other states, is expected to net the state about $20 million in annual revenue, Ferrante said, after accounting for the costs associated with enforcement.

It would allow wagers on professional and major college sports, though bets on individual college athletes would be prohibited. Bets on amateur sports, the Olympics, eSports, or fantasy sports contests also would be prohibited.

Whether bettors should be allowed to place wagers on collegiate sporting events and whether legalization would be successful without collegiate betting emerged as a key consideration during the committee’s hearings last year.

“It’s a huge piece of the market, so if you prohibit college betting you are ignoring an active black market,” Gaming Commission Associate Counsel Justin Stempeck told the committee last May. “On the other hand, if you allow college betting on sports, you have to be cognizant of the added pressures it puts on student athletes and they’re perhaps the most susceptible to these pressures because they’re not making millions of dollars on a professional league contract.”

Baker’s bill would not have allowed betting on any college contests, a decision his secretary of housing and economic development said was made in an attempt to take a “measured approach” to introducing betting.

Ferrante said the bill also establishes a Collegiate Health, Wellness, and Education Fund into which 5 percent of all sports betting revenues would be deposited to help shield college athletes from some of the possible pressures that could come with legal betting.

“If there’s a threat, if there’s a security issue, if there’s an educational issue, we would put aside revenue into a fund to provide them with the extra support that they would need,” the chairwoman said.

The three in-state casino operators — MGM, Wynn Resorts and Penn National Gaming — submitted joint testimony to the committee last spring in which they said they would support allowing some online operators, DraftKings or FanDuel, to get a piece of the sports betting pie.

The companies said they should be the only ones allowed to take bets at physical locations and that mobile betting should be reserved for themselves and “a limited number of daily fantasy operators with proven sports wagering experience.”

The committee appears to have followed a similar path. Only licensed casinos, the Penn-run slots parlor and live horse tracks could take in-person bets under the committee’s bill.

Because the slots parlor at Plainridge Park Casino is the only licensed live horse racing track for 2020, in-person betting could be limited to the three current casino operators. Each of the resort casinos could run up to three online pools and the slots parlor could run up to two.

The committee also adopted the idea of requiring mobile or online-only sportsbooks to have proven experience and to limit them in number. The legislation released Friday would allow up to five online operators and would require that they have at least one year of experience operating daily fantasy sports contests and experience offering online betting in at least two other states.

“This bill is an important step toward eliminating the pervasive illegal market, creating a safe and responsible sports betting experience for sports fans in Massachusetts and boosting the Commonwealth’s innovation economy,” a DraftKings spokesman said Friday afternoon. “We want to thank Chair Ferrante and the members of the House Economic Development Committee for their leadership and diligence on this issue. We look forward to working with Chair Michlewitz and all the members of the House Ways and Means Committee to move this legislation forward.”

In 2013 and 2014, 12.6 percent of Massachusetts residents had placed a bet on a sporting event in the last year, Gaming Commission Chairwoman Cathy Judd-Stein told lawmakers last year as they first dove into sports betting policy. By 2015, that percentage had climbed to 17.9 percent, but fell back to 16.9 percent in 2016, she said, citing the commission’s research into the topic.

People who might have influence over the outcome of a game or information not available publicly — athletes, coaches, umpires and officials, team or league employees and others — would be barred from placing bets, under the bill, as would employees of the Gaming Commission, sports betting licensees and vendors.

Under the committee’s bill, licensees would be required to pay a monthly tax of 10 percent of the gross revenue from sports wagers placed in person and 12 percent of the revenue from bets placed online or on mobile apps. The bill also levies a 12 percent tax on the monthly revenue for fantasy sports contest operators. The taxes would be deposited into the Gaming Revenue Fund.

Ferrante said the data her committee reviewed showed that about 85 percent of all sports wagering revenue is generated by mobile betting platforms. The difference in tax rates is meant to recognize the investments physical sportsbooks operators have or will have to make and the additional costs that hold down the profit margin at a physical betting location.

Sportsbooks tend to operate on small profit margins and the projections for state revenues under previously proposed legislation have hovered around roughly $30 to $35 million. Baker was confident enough about sports betting becoming legal to write $35 million in sports betting revenues into the $44.6 billion fiscal 2021 budget he filed last month.

The committee’s bill does not appear to include any compensation for the sports leagues, though the NBA and others have pushed for a 0.25 percent fee on all wagers placed on any specific league’s games.

“It is modest compensation that fairly treats the leagues as stakeholders and partners. If this happens in Massachusetts, it is new and exciting and a lot of people see a lot of opportunities. But you cannot escape the fact that absent our games, there is no new market to bet on or to be excited about,” Alexandra Roth, associate counsel for league governance and policy at the NBA, told lawmakers last year.

Ferrante said the issue of “integrity fees” is one that could become part of the conversation as her committee’s bill moves on to the House Ways and Means Committee, the House floor and possibly through a similar process in the Senate.

“It was important to us to put a bill out so that we could start this process going and that may be resolved later on in the process,” she said.

The bill also includes consumer safeguards to protect against problem gambling similar to those provisions put in place for casinos when Massachusetts expanded gaming in 2013, like allowing gamblers to add themselves to an exclusion list and requiring that operators implement responsible gaming programs.

Though much of the discussion during the committee’s consideration of sports betting revolved around how to structure and regulate bets, the committee also heard from people who think the Massachusetts should not further expand state-sanctioned gambling.

“Last year alone, the American people lost $118 billion of personal wealth to government-sanctioned gambling. Over the next eight years, the American people are on a collision course to lose more than $1 trillion of their personal wealth to government-sanctioned gambling,” Les Bernal, national director of Stop Predatory Gambling and a former chief of staff to former state Sen. Susan Tucker, said in May.

He added, “If you bring in sports gambling, particularly online, you’re going to make these financial losses to citizens even worse.”

Wynn slammed by Macau shutdown

Wynn slammed by Macau shutdown

Maddox sees some progress at Encore Boston Harbor

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WYNN RESORTS CEO Matt Maddox said the coronavirus shutdown of all the casinos in Macau for at least two weeks is costing the gambling giant millions of dollars a day in lost revenue even as the company continues to burn through $2.4 million to $2.6 million a day in ongoing expenses for employees.

Casino business in Macau was already off dramatically with previous travel restrictions, and is now shut down completely. Maddox said 2020 had been shaping up as an extraordinary year, given the opening of high-speed rail into Macau and light rail service to the casinos. For Wynn’s resorts in Macau, Maddox said, those good times will have to wait until the virus scare subsides.

“It’s a little early to say exactly when we will reopen,” he told financial analysts in a conference call after the company’s release of its fourth quarter results.

At Encore Boston Harbor, Maddox said the company is picking up some steam after a slow start. Earnings before interest, taxes, depreciation, and amortization doubled from $7.8 million in the third quarter of 2019 to $15.3 million in the fourth quarter. The operating loss declined from $41.6 million in the third quarter to $34 million in the fourth. Maddox said expenses at Encore were reduced 11 percent between the two quarters.

“Admittedly, it has opened softer than we thought, particularly on the slots side,” said Maddox. He said the company is adjusting to the Boston market, adding, for example, more quick-serve food options for daytime slots players.

“We feel good about the progress we’re making,” he said.

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Casinos continue sluggish performance

Casinos continue sluggish performance

Plainridge Park records worst full month since opening

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NOVEMBER FIGURES SHOW continued weakness in the Massachusetts casino industry, where fears of market saturation in the Northeast appear warranted and revenue projections for the state’s dive into the casino world look as though they were overly optimistic.

Plainridge Park Casino in Plainville recorded its worst full month since opening in 2015, with $10.9 million in gross gaming revenue at the Plainville slots facility.

MGM Springfield had its second worst full month since it opened in 2018, with $19.9 million in gross revenue in November from slots and table games.

Some of the decline in revenue at the two facilities can no doubt be chalked up to the opening in July of Encore Boston Harbor. The Wynn Resorts casino in Everett had $47.3 million in combined slots and table game revenue in November. That was an increase from $45.8 million in October, but was the second worst full month of operation for Encore since it opened. Based on its first five full months, Encore is on course to generate $583 million in gross gaming revenue over its first year, far short of the more than $800 million Wynn had previously projected.

 

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More ominous signs at Mass. gambling facilities

More ominous signs at Mass. gambling facilities

Encore revenues slide; Plainridge numbers near all-time low

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GAMING FACILITIES in Massachusetts continued to struggle in October, as gross gaming revenue continued to slide at Encore Boston Harbor and the Plainridge Park slots parlor saw its revenue fall to its lowest level since December 2015.

At Everett-based Encore, gross gaming revenue was $45.8 million in October, down $3.1 million from September levels. The October revenue figure, consisting of $22.3 million from slots and $23.5 million from table games, was the lowest month since Encore launched in June. The state’s tax take of $11.4 million was also the lowest level so far.

Slots revenue at Encore, which has been disappointing, made some gains, rising to its highest level yet on a monthly basis. But table game revenue, which started incredibly strong, continued to slide downward.

Gross slots revenue at Plainridge Park in Plainville was $11.2 million in October, down about $300,000 from the previous month. The total was the second-lowest level since the facility opened in 2015. The October number was only $20,599 higher than December 2015, the lowest month on record.

Revenue at MGM Resorts in Springfield edged up slightly in October, rising roughly $900,000 to $21.2 million.

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