California’s two sports betting ballot initiatives are facing an uphill challenge on Election Day, and the focus is already turning to what happens next.
Consider it a sure bet that the fight is far from over.
The Golden State is widely considered the Holy Grail of legalized sports gambling. Industry experts forecast California to be the largest and most profitable sports betting market in the U.S.
Long story short: No one is throwing in the towel just yet.
Petition efforts to get California sports betting on the 2024 ballot are already underway. State lawmakers could also pick up the issue in 2023 after failing to reach a compromise two years ago.
Long road ahead for legal CA sports betting
However, the likely rejection of Proposition 26 and Proposition 27 on Nov. 8 will make the process of enacting legal sports betting much more difficult going forward. The deluge of negative advertising during the 2022 campaign will leave a lingering impression in voters’ minds.
Adding insult to injury, the dueling ballot initiatives caused rifts among vested parties, and millions of dollars were spent on losing efforts.
Answers to complex problems rarely come from Sacramento, and yet…
So, where does the effort to legalize sports gambling in California go from here?
At this point, a compromise between out-of-state online gambling corporations and California tribal casino operators may not be possible.
The outsized influence of the tribes in state politics also means that lawmakers in Sacramento are more likely to side with a tribal vision of legalized sports betting should they decide to pursue the issue next year or beyond. The more prominent and more affluent gaming tribes would almost certainly push for retail-only sports betting to maintain their geographical and economic advantages, a source tells PlayCA.
Online operators vow to keep fighting, sort of
That does not mean online sports betting cannot happen in California.
An online sports betting proposal backed by the San Manuel, Rincon, Graton Rancheria and Wilton Rancheria tribes is already facing bureaucratic hurdles. If the proposal regroups and gathers enough valid signatures, it could qualify for the 2024 ballot.
On Tuesday, FanDuel CEO Amy Howe told the crowd at the Global Gaming Expo (G2E) in Las Vegas that the online operators backing Prop 27 want to “find a solution that aligns the stakeholders – the tribes, racetracks, government and ultimately consumers.” She suggested that 2024 could be a new target date, and they would “live to fight another day.”
DraftKings CEO and co-founder Jason Robins, whose company also supports Prop 27, told the G2E attendees it is hard to imagine California not having sports betting.
“That said, if the opposition is willing to spend more than $100 million, it’s just tough to beat,” Robins said. “It doesn’t matter what your issue is.”
‘Be reasonable, do it our way’
A large group of California tribal casino operators is pushing Prop 26, which would bring sports betting to their properties and a handful of California horse racing tracks. They oppose Prop 27 despite the initiative’s requirement that online operators partner with tribal casinos.
Prop 26 might be a bit of an overreach on the part of the tribes. Part of the proposal also allows dice and roulette games at tribal casinos, and it contains language allowing the operators to go after California cardrooms under the premise of state gambling law violations.
In all likelihood, the failure of 26 and 27 will lead to a more transparent and equitable proposal for legal sports betting in California. But when or how that will happen is unclear.