Everything you need to know about California Sports Betting

Updated on July 12, 2019
[toc]It’s not hard to find a place to gamble in California. The state features almost 100 card rooms and more than 50 tribal California casinos.

However, California is a house divided when it comes to legalized sports betting. At this point, America’s largest state has no definite timeframe for the introduction of wagering on sporting events instate.

At the center of this interminable delay are the competing interests of three stakeholders in the Golden State. The three entities in question are:

  • Tribal interests
  • Cardrooms
  • Racetracks

At this point, California would have to pass a constitutional amendment in order to bring sports betting inside its borders. Due to language in a 2000 ballot initiative, the tribal casinos in California have claimed a de jure jurisdiction over all gambling types, including sports betting.

The largest sports betting market in the country

The AGA estimates Americans wagered $154 billion on sports in 2016. It also claims nearly all of those wagers were illegal.

Broken down by population, that would mean California’s approximately 39.14 million people bet an estimated $18.7 billion on sports in 2016. California is the largest state in America, so it would likely represent the largest sports betting market in the country.

According to Legal Sports Report, that activity would generate first-year revenues of around $100 million. While that figure is a drop in the bucket for California’s $180 billion state budget, it would still be a chunk of new income for a state with budgetary issues.

A state assemblyman from Merced has introduced two sports betting proposals in the last three years. Adam Merced, a Democrat, introduced an assembly bill in 2016 and a constitutional amendment in 2017, but neither bill ever made meaningful progress in the legislating body.

At the same time, an advocacy group called Californians for Sports Betting announced its intention to push for ballot initiatives that would repeal the constitutional language from 2000 that placed so much power in the hands of Native American groups. Needless to say, the tribal interests were not amused, and used their political power to kill almost any mention of sports betting legalization in 2018.

What would a legal sports betting market look like in California?

Based upon the various failed bills in the state, California sports betting would feature:

  • Licensed gaming facilities could take bets on sports. These facilities could accept telephone, computer, and electronic wagering.
  • Players wagering would have to be 21 or older as well as inside California’s borders to bet.
  • There would be licensing fees and taxes on revenues for operators.

According to some industry speculation, a release of a new version of Merced’s amendment may be imminent. The revenue potential is too great simply to let the matter drop.

However, the three stakeholder groups (particularly the tribes) have shown no hesitation about contesting these kinds of activities, no matter the cost. So, the road to a legal sports betting market in California is likely to be quite long as yet.

Sports betting laws in the United States

Of course, in times past, the proposed sports betting bills had to contend with the Professional and Amateur Sports Protection Act (PASPA). PASPA became law in 1992, making Nevada the only state allowed to offer legal sports betting.

In May of 2018, the US Supreme Court ruled that PASPA was unconstitutional and struck down the federal ban on sports betting. Now that the major hurdle is out of the way. California could be one of a number of states that tries to allow sports betting in the state.

Daily fantasy sports in California

Daily fantasy sports (DFS) can sometimes serve as an appetizer for sports betting in states. The relatively new industry shares many of the same characteristics. Its two main companies, DraftKings and FanDuel, are having little difficulty expanding their businesses into bona fide sports betting and gambling.

With regard to the Golden State, one half of the California legislature stood firmly behind a daily fantasy sports (DFS) bill in 2016. The bill breezed through committee hearings. It then came up one vote shy of passing unanimously in the California Assembly.

From there, the Senate sat on the bill. It added an amendment in June. The bill headed to committee, where it died. The San Manuel and Morongo bands of Mission Indians that own and operate a pair of Native American casinos in the state voiced opposition.

Even with the legality of DFS in California still an open question, major operators continue doing business. Lawmakers seem disinterested in stopping them either.

This means there is no legal framework, fees, or taxes associated with DFS operations in California. However, these operations still accept California players, albeit by functioning in what amounts to a grey area.

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