Goodwin Gaming
July 7, 2016

Will Massachusetts Soon Need a Lottery Smartphone App?

In addition to scrolling through their email and reading the news, commuters on the T might soon be able to use their smartphones to play the state lottery. With only a matter of weeks remaining in this year’s legislative session, Massachusetts lawmakers are again considering the possibility of online gaming.  Two bills currently pending in the legislature, S. 2351 and H. 4417, would authorize the state lottery to sell tickets online. S. 2351, introduced by Senator Jennifer Flanagan (D-Leominster) and H. 4417, introduced by the State Treasurer’s Office, represent the latest effort to bring the era of online gaming to Massachusetts.  If adopted, the proposal for an online lottery would align Massachusetts with a small, but growing, number of states that now allow gambling over the internet.

As is usually the case with any significant legalization by the state, an online lottery would likely be accompanied by an extensive regulatory framework.  The Senate proposal’s current language offers a helpful look at what such a regulatory framework might address. Unsurprisingly, the legislation would require any online lottery service to include features that bar access to anyone under the age of 18 and protect the privacy of users’ personal and financial information.  The regulatory framework would also mandate that the online service only allow ticket sales to occur, geographically, within the state of Massachusetts.  Additional regulations would likely further limit an individual’s ability to purchase lottery tickets online.  The Senate’s language would result in rules setting maximum daily, weekly, and monthly purchases by any player, and it would also prohibit online lottery accounts from receiving funds through a player’s direct deposit.  As is the case in New Jersey and Delaware, a large bundle of regulations is likely to accompany any expansion of Massachusetts gambling to the internet.

Whether the online lottery legislation eventually passes and becomes law, however, remains uncertain.  S. 2351 is currently docked in the Senate Ways and Means Committee, where it could remain indefinitely, undergo serious amendment, or advance as is towards passage on the Senate floor.  The political forces influencing the bill’s fate are also complicating the likelihood that an online state lottery will soon become a reality.  The leadership of the state lottery strongly supports online expansion, arguing that online service is a way to keep the lottery—and its revenues—robust. State retailers and convenience store owners, however, view the lottery’s expansion online as a threat to their customer traffic. With only weeks to go until the legislature adjourns its formal sessions for the year, legislative leaders will need to swiftly balance these concerns and decide the fate of the proposal.

If Massachusetts moves forward and legalizes an online state lottery, it will be yet another step in the state’s recent path towards embracing the gaming economy.  Such an action should attract the attention of enthusiastic entrepreneurs and bored smartphone users alike.