Standing before a federal judge, David Nangle promised he would strive to protect others from venturing on to the path of gambling that he had taken.
A former state representative from Lowell, Nangle was indicted by federal prosecutors and arrested in February 2020, charged with using campaign funds to fuel casino trips in Connecticut and golf memberships and lying to banks about his debt to get mortgages and other loans. He lost his reelection bid in a September 2020 primary and a year later was sentenced to 15 months in prison and two years of supervised release.
Nangle returned to the State House Thursday to share his story on gambling addiction and oppose proposed bills to create an internet gaming, or iGaming framework in Massachusetts.
“But through a painful journey, I come to understand just how destructive, how uncontrollable addiction can be,” Nangle told the Joint Committee On Economic Development And Emerging Technologies. “That’s why I’m here today. Legalizing internet gaming is not progress. It’s a gateway to greater harm. It invites people, especially vulnerable individuals, into the same spiral of loss and devastation that I’ve experienced.”
After Nangle spoke, Rep. David Muradian Jr. laid out his proposal (H 4431) to create a structure for regulating internet gaming, while praising the former representative’s courage for sharing his story.
The bill would legalize online casino gambling including digital slot machines and blackjack, and make the new licenses available to the casinos already operating in Massachusetts. Plainridge Park Casino in Plainville, MGM Springfield and Encore Boston Harbor in Everett would each be able to launch three online gaming brands or “skins.” Regulation would fall to the Massachusetts Gaming Commission, which already regulates the state’s casinos, horse racing and sports betting.
The bill was filed in January and has made little progress, while also stirring a lot of debate – even sitting at the top of the “most popular bills” list on the Legislature’s website.
While iGaming would mark a new frontier, the Legislature and Gov. Maura Healey have agreed to let the state Lottery launch an iLottery product and it’s unclear if or where the state will draw a line on gaming expansion, which has grown the state revenue based and enable spending increases without raising taxes.
Dozens of people were drawn to a hearing room to offer their thoughts Thursday on iGaming.
Muradian (R-Grafton) highlighted the proposal as a form of consumer protection as many residents already participate in internet gambling on illegal sites. The bill “brings internet gaming out of the shadows into a safe, transparent and accountable system regulated by the Massachusetts Gaming Commission,” he said.
The bill requires players to be 21 years old or older, physically located in Massachusetts and “verified through secure technology,” he said. There are also deposit limits and operators would be required to monitor for signs of problem gaming and connect players to resources for help. Operators would also be required to pay a 15% state tax on their gross revenue from internet gaming.
Muradian said other states, including neighboring Connecticut and Rhode Island, have established iGaming.
“This is not an expansion of gambling for its own sake. It’s an expansion of accountability. It’s about taking activity that is already happening and making it safe, transparent and beneficial to our state and, most importantly, our residents,” Muradian said. “This bill reflects what Massachusetts has always done, thoughtful, responsible regulation that protects consumers, fosters innovation and ensures fairness.”
Rep. Adam Scanlon, a Democrat from North Attleborough and a self-identified skeptic of the industry, pressed Muradian and supporters of the bill who presented it with him on their argument about how residents are already participating in internet gaming, even though it’s illegal, making it beneficial to regulate the industry.
“You said a couple times that Massachusetts residents are already doing this on their own without it being legalized,” He said. “Should we apply that same argument for legalizing drugs such as heroin?”
John Pappas, state advocacy director with the iDevelopment and Economic Association, said that gambling is already a legal form of entertainment, unlike drugs.
“So the idea that we’re going to somehow equate internet gambling to illegal drugs is, quite frankly, just not a really legitimate argument,” Pappas said.
Legalized internet gambling in other states
Mark Stewart, with the National Association Against iGaming, told a cautionary tale of states that have already legalized internet gambling.
Almost 40% of those who internet gamble in Pennsylvania – where it’s legal – were “pathological gamblers,” he said. Also, studies show Pennsylvania lost 3,700 casino workers since the state launched internet gambling.
And he said Massachusetts should expect similar results.
Stewart said studies project a 16% cannibalization rate of the state’s existing casinos along with almost $100 million per year lost in gaming taxes as well as $62 million lost in non-gaming taxes because of the lost foot traffic in casinos. The social costs, including bankruptcies, homelessness and effects on the child services and the criminal justice system, come out to $260 million each year.
“IGaming does not help complement casinos, it cannibalizes them,” Stewart said.
Rebecca London, a senior government affairs manager at DraftKings, said Muradian’s bill could generate $170 million to $200 million in annual revenue for the state without additional taxes.
In New Jersey, where iGaming was legalized in 2013, officials brought in gross revenue of $260.3 million, marking a 21.8% increase compared to the same time last year, the state’s Attorney General Matthew Platkin announced Monday citing his office’s Division of Gaming Enforcement monthly gross revenue reports. New Jersey’s year-to-date internet gaming revenue was $2.39 billion through October, a 22.6% increase over last year. Casino revenue for the nine casino hotels was $234.7 million in October, a 12.5% increase over the same month last year. Year-to-date casino revenue came in at $2.44 billion, marking a 3.4% increase over last year.
Meanwhile, sports wagering revenue in New Jersey for casinos, racetracks and their partners reached $116.1 million for October — a 49.8% increase over October 2024, according to the report. Year-to-date revenue was $914.6 million through October, marking a 0.2% increase over the last year-to-date period.
In terms of economic effects, Nangle said internet gaming creates few jobs and every $1 spent at an online casino is $1 not spent at a local store for scratch tickets or on gambling the state generates revenue from.
Additionally, he said it doesn’t make sense to promote internet gambling – which is mainly done on cellphones – while there are ongoing debates surrounding whether to ban cellphones in schools.
“How can we ban cellphones in school on Monday and legalize gambling on them by Tuesday? That contradiction should concern every parent and policymaker in this building,” Nangle said.
Shawn Fluharty, the Minority Whip in West Virginia’s House of Delegates and president of the National Council of Legislators from Gaming States, noted that internet gaming has been a bipartisan issue across the country.
“It’s good policy,” Fluharty said, as to why internet gaming has earned support from both parties. “It shrinks the black market, it raises new revenue and it protects the consumer.”
Fluharty also praised the ban in Muradian’s bill on sweepstakes gambling, which are unregulated sites that allow players to buy virtual currency to play games, and can be redeemed for prizes or cash.
Research from the Massachusetts Budget and Policy Center and UMass Donahue Institute has shown that the state’s casino revenues have been fairly static since legal sports betting began.
Sports betting revenues are subject to a lower tax rate than casino gaming revenues are — 15% for in-person bets and 20% for mobile bets, versus a 25% tax on casino revenue and a 49% tax on slot facility revenue. Researchers have warned that while sports betting becomes more popular, it could cause trouble for the state, which relies on gambling tax revenues.
When asked by Scanlon about why internet gaming revenues would be taxed lower than casino taxes, Muradian said the proposed 15% is “fairly middle ground” as New York is proposing 30%.
“So I think that this is a fair number that is kind of respectful to the industry market, but also the consumers,” Muradian said.
Katie Castellani is a reporter for State House News Service and State Affairs Pro Massachusetts. Reach her at kcastellani@stateaffairs.com.