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    Casinos and daily fantasy industries get on same page about sports bets

    BOSTON, MA - 3/25/2019: The entrance from the elevators is suppose to resemble a tunnel as if you were entering a stadium. DraftKings is opening its new office in the Back Bay, where it says it will eventually grow its work force to about 600. The company, which made its name in daily fantasy sports, is moving into sports betting, an area where it sees big growth. (David L Ryan/Globe Staff ) SECTION: BUSINESS TOPIC
    David L. Ryan/globe staff/file
    DraftKings, headquartered in Boston, sees the potential for big growth in sports betting.

    Key players in the state’s gambling industry are aligning on major aspects of how legalized sports betting could work in Massachusetts, potentially heading off a fight over the spoils of a business that is rapidly expanding around the nation.

    The state’s three casinos say that they now support mobile sports betting and that both casinos and established fantasy sports firms should be able to run digital sports books. That’s a position casinos in other states have resisted, and one that online betting companies, including Boston’s well-connected DraftKings, have long been pushing.

    The management of MGM Springfield, Plainridge Park Casino, and Encore Boston Harbor plan to lay out their position Tuesday, when a legislative panel begins two days of high-stakes hearings that could set the scene for the state’s first major gambling expansion since casinos were legalized in 2011. The Boston Globe obtained a copy of the testimony they intend to deliver on Beacon Hill.

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    No clear consensus has emerged on sports betting in the Legislature in the year since the US Supreme Court cleared the way for the practice to expand beyond Nevada. Multiple proposals are on the table, including one from Governor Charlie Baker that would allow people to wager on professional games at casinos and online. Several influential lawmakers have not indicated whether they think the practice should be legal at all.

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    But the casinos’ willingness to share the mobile market eliminates what might have been a significant dispute with DraftKings, which has developed considerable influence on Beacon Hill and had been pushing for the right to operate sports betting products on its own. The casinos suggested that other companies could potentially run additional mobile games as part of business agreements with the casinos.

    “A reasonable number of market participants is good for consumers, driving providers to be innovative and to provide the best possible odds to customers,” the management of the three casinos said in a draft of the testimony they intend to deliver to the Joint Committee on Economic Development and Emerging Technologies.

    About a dozen states have legalized betting on sports games in the past year, and those that have allowed mobile betting have generally run the process either through local casinos or state lotteries.

    “We are glad that there appears to be a growing industry consensus around direct licensing of mobile operators, and believe there is a real opportunity for Massachusetts to . . . set a new national model that embraces a competitive mobile marketplace,” James Chisholm, DraftKings head of public affairs, said in a statement.

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    Baker’s proposal would open up the sports betting market more widely than the casinos are suggesting, allowing any company that can secure a license from the Massachusetts Gaming Commission to participate in mobile betting.

    The Republican governor’s office said he wants the bill passed quickly to maximize the benefits to state and local governments, which would get a cut of the proceeds.

    The administration has estimated that his measure would generate $35 million in taxes and licensing fees this year. Those pushing for legalization also argue that a well-designed program could limit the prevalence of black market sports betting, which savvy customers can already do through offshore websites.

    Still, leaders in both the House and Senate have indicated they’re in no rush.

    Senator Eric P. Lesser, a Longmeadow Democrat who is cochairman of the economic development committee, said here are still many complexities the Legislature will have to sort through.

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    “Massachusetts represents a high-profile and unique market. We have some of the best sports teams in the country. We’re also home to DraftKings,” he said. “We’re also home to three brick-and-mortar casinos, and we’re also a state that has a fairly stable fiscal [picture].”

    Lesser said he wants to hear the perspectives of the Massachusetts State Lottery and the horse racing industry, gambling interests that don’t have an obvious place in some of the concepts being discussed.

    That means sports bets, online or otherwise, would be controlled by a few established entrants: the casinos and daily fantasy companies.

    That would be a stark contrast to the legalization rollout of another business once considered a vice: marijuana. In that industry, the state has made efforts — albeit with sometimes disappointing results — to extend opportunities to small and minority businesses. “There’s an equity piece here that needs to be discussed,” said Michael R. Sweeney, executive director of the lottery. “A lot of small businesses that are convenience stores, restaurants, and bars are owned across multicultural backgrounds.”

    Sports betting could potentially be a source of foot traffic to those businesses, as games such as Keno have been, he said.

    Michael Mathis, president of the MGM Springfield casino, suggested that mobile sports betting could help small businesses by drawing people into restaurants and bars to watch games and play along.

    He said sports betting is indeed a good source of foot traffic. Casinos view it as an amenity to draw in customers rather than a major revenue driver on its own. That’s why his company is so eager to get a sports betting plan passed quickly, before more neighboring states catch up.

    Sports betting is already legal in Rhode Island, and Connecticut and New Hampshire are in advanced discussions on sports betting bills.

    MGM is already in a pitched battle for customers with Connecticut’s well-established casino business.

    “For a property like ours, with Springfield being right on the state line, that’s an important dynamic. I think it’s very important that we get to the market as quickly as we can,” Mathis said. “If we don’t get this legislation passed, Connecticut has the same opportunity to draw customers across the state line.”

    The Legislature on Tuesday will also be hearing from professional sports leagues, which have been warming to the idea of sports betting, which they once opposed. But the leagues also want a cut of the revenue from the contests, which they say wouldn’t exist without their product.

    Bryan Seeley, who oversees security and investigations at Major League Baseball, said in a recent interview that the league would be happy to see an approach that recognizes its role and provides resources to help prevent fraud.

    “It is very important to us that a state pass a bill that serves as a model for the rest of the country, and protects sports and sports fans, and maximizes revenue for the state,” he said.

    Another group that will be present at the hearing is offering perhaps the simplest approach to the problem. Les Bernal, national director of the group Stop Predatory Gambling, said the state doesn’t have to do anything at all.

    “There’s no grass-roots movement for commercial sports betting in Massachusetts. It’s being driven by very powerful financial interests who stand to make tens of millions if this gets done,” he said. “It’s only going to benefit the already wealthy people who are going to run these games.”

    Andy Rosen can be reached at andrew.rosen@globe.com.