Sportsbook Operators Fund Calif. Mobile Wagering Initiative

Written By Matthew Kredell on September 10, 2021

Sports betting operators followed through on their pledge to contribute $100 million to back a California mobile wagering initiative. And there may be more where that came from.

Last week, seven sportsbook companies announced a proposed initiative filed with the California Attorney General.

They filed financing for the Californians for Solutions to Homelessness and Mental Health Support campaign the same day. However, the contributions didn’t appear in the cal-access system until this week.

The operators wrote checks for nearly the same amount to reach the impressive $100 million figure.

DraftKings, FanDuel and BetMGM each gave $16,667,000.

Bally’s Interactive, Fanatics, Penn National Gaming and WynnBET each added $12.5 million.

Sportsbook operators prepared to put up more money

Initiative spokesman Nathan Click told PlayCA that $100 million is just a start.

“One hundred million is the floor, not the ceiling,” Click said. “We’re building a campaign to win in November (2022).”

The floor already is more money than nearly all initiative campaigns spend at the finish.

In the 2020 election, California had 12 statewide ballot measures. Of those 12, only Prop 22 on employment classification for app-based transportation and delivery drivers cost that much.

The transportation and delivery companies ponied up nearly $189 million only to have a California Superior Court judge rule the proposition unconstitutional last month. The next best-funded ballot measure totaled $56 million.

In Florida, a proposed sports betting measure funded by some of the same companies only started with $20 million.

Why such a large amount?

Understanding why sportsbook operators are willing to put up this kind of money starts with realizing California’s market potential.

As important as New York is to operators, California has twice the population.

With about 40 million people, California is primed to be the largest sports betting market in the nation.

By limiting the market to in-person wagers at tribal casinos or racetracks, the initiative backed by California Indian tribes keeps out the mobile operators. With the high $10 million entry fee for a license, the operators ensure they can split up the market without any surprises.

It’s also an acknowledgement that, even though the operator initiative tethers online sportsbooks to tribes and is presented in a way that both measures can pass, there is a battle brewing.

Only hotly contested propositions like Prop 22 spend over $100 million. It’s fighting money.

Click said the operators meant the $100 million as a statement.

“It shows our seriousness and how competitive this initiative is going to be,” Click said. “History shows that ballot measures can be expensive, and we wanted to show from the beginning that we are very serious. This is going to be a competitive race, and we’re going to do what it takes to win.”

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Matthew Kredell

Matthew has covered efforts to legalize and regulate online gambling since 2007. His reporting on the legalization of sports betting began in 2010 with an article for Playboy Magazine on how the NFL was pushing US money overseas by fighting the expansion of regulated sports betting. A USC journalism alum, Matt started his career as a sportswriter at the Los Angeles Daily News and has written on a variety of topics for Playboy, Men’s Journal, Los Angeles magazine, LA Weekly and ESPN.com.

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