Could California Follow States like New Jersey in Legalizing Online Gambling?
Contrary to popular belief, gambling isn’t entirely prohibited in California. The Golden State permits Native Americans to run casinos on reserved land. These casinos can offer horse race betting, slots, table games and lotto.
California also supports card games as long as they are licensed. This means you can play poker legally in the state if you’re above 18 years. Another form of gambling that’s legal in Cali is charitable gaming.
So, why hasn’t the Golden State authorized online gambling yet? Are there plans to legalize the sector?
Californians Will Vote on Betting in November
Four years after the Supreme Court allowed states to regulate sports betting, California is ready to legalize the industry. Unlike some other states, California will put the decision to a vote this fall.
Voters in the state will be tasked to legalize or oppose two betting bills:
- Tribal Sports Wagering Act
- Solution to Homelessness and Mental Health Act
The first bill will ask voters to legalize in-person sports betting at tribal casinos. What’s more, citizens in the state will also have to wager on four race tracks, including the famous Del Mar.
According to its proponents, the Tribal Sports Wagering Act will help California generate millions of dollars it could add to its general fund. As already mentioned, casino gaming is legal on tribal land. So, permitting sports betting will only expand the betting options tribal casinos have.
The second bill seeks to legalize online sports betting through commercial casinos and sportsbooks. It was sponsored by FanDuel and DraftKings. The bill suggests that money generated from sports betting could be used in the treatment of mental health and solving homelessness.
The Threat of Black-Market Casinos
In the past few years, California has been contemplating legalizing online casinos for one reason: Ending black market websites. State laws do not categorically prohibit online gambling.
As such, plenty of foreign casinos accept gamblers from the state. These casinos and sportsbooks can’t get licensed in California, though. Legalizing online gambling would certainly elevate CA into the ranks of New Jersey and Michigan, states that generate over $1 billion from legal betting.
What’s more, legalizing the sector would encourage more people to spend their money at legal, regulated websites. Presently, offshore casinos that accept bets from Californians are based in Panama, Curacao and Costa Rica.
Although these websites have licenses, they are not as trustworthy as operators based in the US. Some of them also don’t have fair terms for bonuses or offer the fast banking many online casinos in New Jersey offer.
Will Californians Legalize Online Gambling?
As mentioned, California is taking iGaming legalization one step at a time. This November, the state will let its citizens decide whether to legalize sports betting or not.
If the people vote to legalize betting, there’s a huge chance the state will target online casinos next. Here’s why:
Massive Tax Revenues
Many states with legal online betting generate hundreds of millions or billions of dollars in revenues. Take New Jersey as an example. Last year, the state collected more than $1.4 billion from its online casinos and sportsbooks.
Both Nevada and Michigan also garnered over $1 billion in annual revenues last year. New York, which legalized sports betting earlier this year, is also on course to generate more than $1 billion from the same industry this year.
Given California’s huge population, a legal iGaming industry would likely also earn the state billions in revenues. Of course, the amount of money generated would be determined by several factors.
For example, New Jersey is successful in iGaming because it has licensed more than 20 gambling companies. Also, it taxes these companies at a flat rate of 13%. If California follows the same business-friendly measures, it will likely also succeed.
Support from the Public
Public sentiment towards online gambling has changed drastically in the past four years. Before the Supreme Court decision, people had different opinions regarding the industry.
Post PASPA, a majority of Americans agree that online betting can be provided safely and in a regulated environment. If that’s not enough evidence, statistics show that Californians make up a significant number of the 40M tourists who visit Las Vegas every year.
People in California are supporting legal online betting because they already do it. As stated earlier, you can play poker online in the state. You can also gamble on slots at tribal casinos. Additionally, you can participate in Daily Fantasy Sports.
Legalizing online gambling would only rubber stamp an activity the people of California love. Also, it would make it easier to find better games and betting odds.
Solving Homelessness and Mental Health
Another reason California will likely legalize online gambling is to help solve some of the problems in the state. Specifically, one of the bills voters will seek to pass in November comes with instructions on how to spend taxes generated from betting.
On the one hand, the taxes could be used to help reduce the problem of homelessness in the state. Some critics of the bill say money generated from betting will never be enough to end homelessness in California, though.
Still, both Fanduel and DraftKings believe California will have a chance to generate more than $30M in taxes per month. And this is money that could solve mental health and homelessness in the state, even if it’s by a small margin.
New Jersey’s online gambling sector accounts for 10,000 jobs. Now, this might not sound like a lot of jobs. But the figure accounts for only those people employed by sportsbooks and casinos directly.
When jobs created through software providers, independent marketers and suppliers are put into consideration, the sector could add up to 100,000 new employment opportunities.
California has been toying with the idea of legalizing online gambling for a few years. After facing a few roadblocks along the way, the state is putting the decision-making powers in the hands of voters.
This November, voters in California will have the choice to legalize one or more sports betting bills. If the bills are passed into law, the state will likely seek to expand betting options to include games of chance like slots and blackjack.