Massachusetts’ Joint Committee on Economic Development and Emerging Technologies held a hearing Thursday on legislation that would bring online casino gaming to the state, with proponents arguing the bill would regulate an activity already happening through illegal offshore sites.

Rep. David Muradian Jr., author of House Bill 4431, told the committee that Massachusetts residents are gambling online without any oversight.

“There are no consumer protections, no responsible gaming standards, and the bill will change that,” Muradian said at the hearing.

The legislation would allow the state’s existing licensed casino operators to offer online casino games under Massachusetts Gaming Commission regulation. It would establish a 15% tax on adjusted gross internet gaming revenue, with Muradian noting the money would fund “education, local aid and responsible gaming program dollars rather than being lost to said black unregulated markets.”

John Pappas, a gambling consultant, presented data showing the scope of illegal online gambling in the state.

“Residents conducted more than 250,000 monthly searches for online casino and poker content, and that’s resulted in 1.2 million visits to illegal online casino sites just here in the state every single month,” Pappas said.

More money

Pappas pushed back against concerns that online casinos would hurt brick-and-mortar properties, citing Pennsylvania as an example. Before iGaming, Pennsylvania’s gaming industry contributed $1.3 billion in tax revenue in 2018, he said, compared to $2.7 billion the past fiscal year with iGaming and other forms of gaming established.

Rebecca London, a senior government affairs manager at DraftKings, testified that the legislation “could conservatively generate $170 to $200 million annually without additional taxes on Commonwealth residents.” She noted that Massachusetts, with its large population and strong sports betting market, “has the potential to outperform early benchmarks by others.”

The bill includes multiple consumer protection provisions. Players must be 21 or older and physically located in Massachusetts. The legislation requires deposit limits, with a maximum of $20,000 in a 24-hour period, and mandates that operators monitor for problem gaming behavior.

Muradian emphasized the bill’s approach to responsible gaming.

“It establishes strong consumer protections,” he said. “Players can set their own limits or self-exclude entirely. Operators will be required to monitor for problem gaming behavior and to connect players to resources for help.”

The legislation would also prohibit online sweepstakes games, which operate in a legal gray area in the commonwealth. Violations would carry fines between $10,000 and $100,000, with repeat offenders facing potential imprisonment.

Massachusetts joins several other states in considering iCasino legislation. Connecticut, Rhode Island, New Jersey, Pennsylvania, Michigan, West Virginia, and Delaware are the seven states that offer online casino.