Maine takes step toward launch of sports wagering, but betting still months away
Jan. 11—The head of Maine's Gambling Control Unit said it will be months — perhaps a year — before sports wagering is up and running in the state.
Milt Champion, the agency's director, set out the time line during a news conference in Augusta on Wednesday to introduce proposed rules regulating sports betting in Maine. Announcement of the rules, which provide a framework for how the business will operate here, marks the most essential step yet in the launch of sports wagering in Maine since it became law in August.
Sports betting is currently legal in 36 states and Washington, D.C. At least a dozen of those states went from legalization to launch in less than six months.
Champion, who last summer projected a live launch for sports wagering in Maine between April and January 2024, said Wednesday, "I don't think that's changed."
Champion stressed a desire for what he termed a "soft opening," as opposed to rushing and overlooking areas that can become problems later on. Ohio ran into such troubles, fining BetMGM, DraftKings and Caesars Sportsbook $150,000 apiece last week for breaking advertising rules.
"I know everybody wants (sports wagering) either out during the Super Bowl or out during March Madness, but let's face it, it's just not going to happen," he said. "We can look for next year. There's a Super Bowl next year. There is going to be March Madness next year."
Champion said going live later will allow for a smooth debut.
"I'd rather test the waters at a lower-volume type of situation, as opposed to blasting it out during the Super Bowl," he said. "Then you've got systems down or an underage gets processed. ... It allows us to get the kinks out."
Champion estimated Wednesday that the sports betting revenue for the state will be $3.8 million to $6.9 million annually, generated by in-person and mobile gambling. The mobile market is far more lucrative — 87 percent of bets in the country in 2021 were made online, according to the American Gaming Association — and the rights to that money will go to the Maliseet, Micmac, Passamaquoddy and Penobscot tribes.
The tribes will be able to choose their own management service provider, which would then need to be approved by Champion. The money will be split up with 10 percent of the gross going to the state after payouts to bettors, 0.25 percent going to the federal government in taxes, up to 30 percent (or up to 40, if Champion signs off) going to the providers and the rest going to the tribes. In-person locations also will be able to arrange deals with providers, pending Champion's approval.
Champion said he hasn't heard which providers could be coming to Maine. Messages to tribal leaders seeking interviews for this story were not returned.
"I don't know where they're at in those negotiations," he said. "I'll find out when they apply (for licenses)."
DON'T BET ON BIG PROVIDERS
Two of the most prominent providers are DraftKings and FanDuel, but Steven Silver, the chair of the Gambling Control Board, said the biggest names could be dissuaded from working with Maine by the maximum of only 40 percent of the revenue.
"It's unique to Maine, this 30-40 percent rule, and that makes it really difficult for anyone to make money off of the mobile side," said Silver, who also teaches sports betting law at the University of Maine School of Law. "Thirty percent is quite low on what is a small margin already. ... I think that's tempered the enthusiasm for (providers) to come into Maine. That's unfortunate for the consumer, in the end."
Silver said he doesn't have knowledge of negotiations, but wouldn't be surprised to see smaller names sign up.
"I think there's a sense out there that this is sort of printing money, and that's not true," he said. "I think you will see some recognizable names from the gaming industry, but maybe not from the top (providers) we see in other states."
Champion said he began working on the rules in 2019, before Mills vetoed a legislative effort at that time to legalize sports betting. The proposed rules will be discussed in a hearing with the public and industry representatives on Jan. 31, and the Gambling Control Unit will get written comments on March 3.
Champion and his staff will deliberate whether the rules are ready or if they should be revised, which would allow for another session of written comments. Once the rules are finalized, they will be brought to the Maine Attorney General's Office for approval within 120 days, at which point the state could go live.
The 56-page document covers rules for topics such as obtaining sports betting licenses, the amenities required to run in-person betting, house rules and the procedure to verify that mobile bettors are at least 21 years old.
WORKING WITH OTHER STATES
Champion said he and his staff, which includes sports wagering inspector Kyle Bourget and auditor Alex Joutov, worked with six to eight states to come up with the rules.
"We didn't want to reinvent the wheel," he said.
Scott Gagnon, who oversees the problem gambling division as the director of the Ad Care Educational Institute of Maine, said the rules are geared toward the well-being of the bettors. The rules allow for bettors to put themselves on an exclusion list, there are rules about advertising messages, and operators are required to make a hotline available for anyone developing problem gambling habits.
"More participation means potentially there's more people that enter that risk," he said, "but the rules set some good groundwork for addressing that."
While Maine has taken longer to release rules than other states did after legalizing sports betting, Champion said an earlier timeframe wasn't feasible for his small staff.
"We've all read it, there are other states that have knocked these rules out and gone live within 80 days, 90 days and all that," he said. "Well, give me 80 employees and I'll make that happen, too."
Gagnon said the wait has been worth it for a successful launch.
"I think the pace has been good," he said. "It really shows it wasn't just looking at the operators, it's looking at the population that's going to be engaging in this."