Sports betting enthusiasts in Maine have reason to celebrate as the state’s Gambling Control Unit (MGCU) announced the official launch of sports betting on Friday, November 3. With Governor Janet Mills signing the legislation in May of 2022, Maine has taken a significant step forward in embracing the exciting world of sports gambling.
One of the key highlights of the legislation is the allocation of the mobile and online sports betting market to Native American tribes in Maine. Governor Mills extended an olive branch to the tribes after her previous veto threat, granting them a significant role in the sports betting industry. This move is expected to provide a conduit for revenue for the tribes, with mobile and online wagering projected to account for 85 percent of the sports betting market in the state.
Each Native American tribe in Maine has the authority to select its own vendor, allowing for a diverse range of options in the sports betting market. This means that there could potentially be up to four licenses granted to the Penobscot Nation, Passamaquoddy tribes at Indian Township and Pleasant Point, Houlton Band of Maliseets and Mi’kmaq.
DraftKings recently formed a partnership with the Passamaquoddy Tribe—the agreement is subject to licensing and regulatory approvals. Once approved, the DraftKings Sportsbook app will be launched, allowing sports fans in the state to legally wager online for the first time.
DraftKings has made a generous contribution to the Lewiston-Auburn Area Response Fund. The company has donated $100,000 to provide support for those affected by the recent shootings in Lewiston.
“We look forward to our continued collaboration with the Maine Gambling Control Unit as we become the official mobile sports betting provider of the Passamaquoddy Tribe and launch in our industry-leading 25th state,” DraftKings CEO Jason Robins said in a statement.
Caesars has also secured market access to Maine, through an agreement with three of the four access point tribes—the Maliseet, Mi’kmaq, and Penobscot tribes.
The launch of sports betting in Maine has been a long and controversial process. While other states that legalized sports betting around the same time have already launched their operations, Maine has taken its time to establish the necessary regulations for the market. The delay in launching has been accompanied by controversies surrounding the regulatory framework.
The American Gaming Association (AGA) President and CEO, Bill Miller, wrote a letter to the MGCU demanding the relaxation of advertising restrictions. Additionally, the director of the MGCU, Milton Champion, was temporarily suspended due to a social media controversy.
Maine’s sports betting legislation has a unique structure that sets it apart from other states. Under the current legislation, 50 percent of the revenue generated from sports betting will be given to tribal operators.
Additionally, the state will collect an additional 10 percent of the revenue as taxes. This revenue-sharing model aims to support and benefit tribal communities in Maine.
However, the revenue-sharing model and tax rate have deterred some operators from entering the online sports betting space in Maine. Operators like BetMGM and FanDuel expressed reservations about operating in a market with such a structure.
The introduction of sports betting is expected to have a positive economic impact on the state. Champion has estimated that sports betting could generate between $3.8 million and $6.9 million in revenue for the state. This revenue will be in addition to the $64 million already generated from casinos and other legal gambling activities in 2022.
While there is excitement about Maine’s sports betting launch, the state has recently cracked down on a particular wager that remains banned. The MGCUhas fined a New York-based fantasy sports betting company, Underdog Fantasy, nearly $400,000 for accepting “pick ’em” sports bets.
While fantasy sports gambling, where bets are placed on hypothetical teams and players compete against each other, is legal in Maine, the MGCU has deemed Underdog’s pick ’em bets illegal. The agency argues that these bets involve actual sports teams and wagers against the gambling operator itself, thus violating the existing regulations.
The MGCU began investigating Underdog’s pick ’em bets in May, as the agency was in the process of formulating rules to govern legalized sports gambling in Maine. By October 15, their investigation revealed that Underdog had accepted around 482,770 wagers from nearly 8,000 residents of Maine. In response, the agency fined Underdog $391,850 for their activities. While Maine law allows fines of up to $1,000 per violation, the MGCU opted for a relatively modest fine of $50 per violation.
