Today, State Treasurer Deborah B. Goldberg joined the Massachusetts' Gaming Commission for a virtual hearing to discuss the recent legalization of sports betting in Massachusetts. Treasurer Goldberg provided testimony requesting the continued collaboration on the many areas of intersection between the work of the Gaming Commission and the work of the Treasurer’s Office, including the Lottery, financial literacy, and unclaimed property. Below are the Treasurer's remarks prepared for delivery:
REMARKS OF TREASURER DEBORAH B. GOLDBERG:
Gaming Commission Hearing
Thursday, September 8, 2022
Thank you for the opportunity to speak with you today. I appreciate the Commission’s deliberate and transparent approach to the regulation of sports wagering.
I am joined by Mark William Bracken, the Interim Executive Director of the Massachusetts State Lottery, who also serves as Assistant Treasurer and Executive Director of the Unclaimed Property Division.
We look forward to discussing the many points of intersection between the work of this Commission and our work, including the Lottery, financial education, and this might surprise you, unclaimed property.
Turning first to the Lottery, one of my primary responsibilities as Treasurer is to ensure a consistent and growing source of unrestricted local aid for all 351 of our cities and towns.
As you draft sports wagering regulations, I urge you to incorporate provisions that will enable the Lottery to continue to deliver consistent revenue and, as a direct result, valuable resources for every community in the Commonwealth.
While lawmakers project that sports wagering will generate $60 million in state revenue each year, only $16.5 million [27.5%] will be earmarked for unrestricted local aid.
By contrast, the Lottery produced approximately $1.1 billion for our cities and towns just last year.
Simply put, the Lottery plays a vital role in generating unrestricted local aid for our cities and towns, and it is imperative that we work to ensure it continues to do so.
We already face mounting headwinds. In fact, we are actively monitoring a concerning trend. Sales of the Lottery’s top two product categories, scratch tickets and Keno, which together make up nearly 88 percent of all Lottery sales, were down 6 and 5 percent respectively last month.
Combined with new entertainment options soon- to- be available to consumers who have increasingly limited resources, I am concerned that this trend will negatively impact the Lottery’s ability to deliver unrestricted local aid.
To help hold local aid harmless, I seek sports wagering provisions that mirror the regulations governing the existing gaming licenses, specifically, requiring that prior to receiving a license applicants present a plan to mitigate any impacts on the Lottery and requiring that licensees’ partner with the Lottery on cross-promotion, both in-person and online.
So far, we have found that this framework has resulted in a productive, not to mention profitable relationship with existing licensees.
The Plainridge slot parlor is one of the Lottery’s top performing retailers. And we are building toward similar results at MGM in Springfield and Encore in Everett.
I am confident that implementing this same framework for the Lottery’s relationship with respect to sports wagering will prove beneficial both for operators and for the local communities that depend on the Lottery.
Looking further down the road, I strongly encourage the Commission to include the team of experts at Treasury and at the Lottery as part of the required study of the feasibility of allowing retail locations to operate sports wagering kiosks. Many of the interested locations are licensees of the Lottery and/or the Alcoholic Beverages Control Commission (“ABCC”), which also falls within the purview of my Office.
I would also like to note how much I appreciate and value our partnership when it comes to financial education.
My team at the Office of Economic Empowerment has enjoyed working with you to train GameSense Advisors on all of the tools and resources that we have available to benefit players. We also look forward to incorporating casino gaming and sports wagering modules into our Credit for Life Fair programming.
I welcome the opportunity to build upon and expand this partnership to meet needs as they change.
Finally, I encourage you to look to the example of other states, Iowa, in particular, when it comes to abandoned accounts.
I recognize the Legislature specified that unclaimed winning sports wagers shall be deposited in the Sports Wagering Control Fund if no claim is made for the winning wager 1 year after the relevant game or event.
However, the legislation does not speak to abandoned or stagnant accounts.
Currently, the leading sports wagering firms do not treat these accounts as Unclaimed Property, when unregulated. Instead, they take them into revenue after a certain amount of time through draw downs and fees.
While my office would consider these accounts “miscellaneous accounts” and reportable as unclaimed property as defined by state statute, clear definitions and administrative rules will protect consumers, enabling enforcement through the Treasury’s Unclaimed Property Division.
Left unaddressed, I am concerned that operators will continue to implement business practices that we would deem inappropriate and in violation of state law.
Thank you again for the opportunity to speak with you all today. I am sure that it will be the first of many conversations!