California Sports Betting Hearing Offers Glimmers of Hope For 2020 Vote

Written By Derek Helling on November 7, 2019
California Sports Betting Hearing Offers Hope

Just about a year out from a statewide election, the possibility of an amendment to expand gambling in the Golden State looks good. A California sports betting hearing that might take place this month is a positive sign.

Members of the Legislature plan to gather potential stakeholders in Los Angeles on Nov. 20. It could be a preliminary step in forming a compromise.

Details on the California sports betting hearing

Although a list of exact attendees hasn’t been confirmed, there are strong likelihoods. If representatives of these parties don’t participate, there isn’t much point in holding the hearing.

That includes legislators sponsoring bills, like Assemblyman Adam Gray and Sen. Bill Dodd. While it’s possible other legislators may attend, those are the two most likely to appear.

It’s also possible to see a representative of California Gov. Gavin Newsom’s office or the California Gambling Control Commission. By all accounts, Newsom’s administration hasn’t been active on this matter yet.

If the organizers can get sportsbook operators like DraftKings to attend, that would provide the attendees with a vital perspective on both the brick-and-mortar and online aspects of the industry.

Representatives of professional sports leagues and/or teams are other potential attendees. In every other state considering such measures, such parties have been active in lobbying legislators for official data mandates and sportsbook royalties.

Three more likely participants are representatives of California card rooms, race tracks and California tribal casinos. These key stakeholders will likely have a strong influence on what forms sports betting might take in California.

The hurdles to passing a sports betting amendment

Simply put, the relationship between the state’s tribal casinos and card rooms can be volatile. The casinos maintain the card rooms illegally operate games state law gives them exclusive license to offer.

The card rooms insist they are operating within the law, however. Because of that, the casinos have pursued legal action in the past to force the state to enforce their interpretation of the law.

So far those lawsuits have failed. Despite that, it’s unlikely the casinos will support any expansion of gambling in the Golden State unless concessions are made to them.

Those concessions can’t go too far in restricting activity at card rooms, however. If that happens, the state will likely lose the support of those operators when it comes to gambling expansion.

Other concerns include what tax rates to levy upon sportsbooks and who could apply for licenses. Some states allow a wide array of facilities to offer sports betting while others restrict it to brick-and-mortar casinos.

All that would be determined at a much later date, however. Before any of that is decided upon, the state’s voters have to give their approval.

That’s why the focus of this hearing will likely not be on getting to a consensus for a framework but rather gauging support for a possible constitutional amendment. That’s the crucial first step.

Why the state needs support for an amendment

As the state’s constitution is currently written, the state government can’t authorize new forms of gambling. With each successive expansion, an amendment is necessary to grant that power to the state government.

Amending the constitution is an intentionally arduous process, however. It requires both the state’s Assembly and Senate to pass identical bills by a two-thirds majority.

After clearing the governor’s desk from there, the potential amendment would then undergo a ballot measure. If a majority of California’s voters approve it, only then would it become part of the state’s constitution.

Optimistically, such a measure could appear on the ballot next November in California. The process to make that a reality starts with this hearing.

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Derek Helling

Derek Helling is a lead writer for PlayUSA and the manager of BetHer. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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