What November’s Election Means for Casinos in California
The California Legalize Sports Betting on American Indian Lands Initiative has qualified for the November 8, 2022, ballot as a combined initiated constitutional amendment and state act.
For years, Californians have advocated for the legalization of sports betting in the Golden State. With the November election approaching, various distinct sports betting initiatives are battling for a seat on the ballot.
Sports Betting Definition
With the exclusion of high school sports and games featuring a California college team, the ballot initiative would define sports betting as gambling on the outcomes of professional, college, or amateur sports and athletic activities.
Bettors must be 21 years old to participate in authorized sports betting. The full list of current casinos in California provided by Casinos.us explains more about what to expect, from bonuses to payment methods.
The first initiative, filed by the state’s tribes, is the only one of the few that has already gained a seat on the ballot and Californians will vote for it in November. This ballot measure would allow sports betting at all state-tribal casinos and racetracks in California, taxing it at a 10% rate.
However, it expressly outlaws online sports betting. Indeed, supporters of the initiative have asked for a five- to ten-year prohibition on online sports betting in the state following its retail-only authorization.
The major aim for these tribes is to protect their gaming exclusivity in the state. However, prohibiting online sports betting was greeted with criticism since it is a critical component of the profitable potential of the California market. As a result, they proposed a follow-up measure that would enable online sports betting, but only at tribal casinos.
The second measure, known as the California Solutions to Homelessness and Mental Health Support Act, would establish online-only sports betting market in California, enabling only tribes and operators to provide online sports betting alternatives to California residents.
DraftKings, FanDuel, Penn National Gaming, BetMGM, Bally’s Interactive, Fanatics Betting & Gaming, and WynnBet are the coalition’s key supporters. These are likely to be the operators who obtain state licensure if the law is adopted since they will be the ones who can afford it. A $100 million licensing fee is proposed, with a $10 million renewal cost every five years.
Tribes, on the other hand, would pay a $10 million licensing fee, a $1 million renewal charge, and the option to develop their own branded sports betting app. The state would impose a 10% tax on both operators and tribes. Horse tracks, racetracks, and sports franchises would be ineligible to accept wagers.
There are hundreds of tribes in California, but considerably fewer operations. To include all non-participating tribes in the online betting market, these tribes would get 15% of the tax profits from online sports betting in California.
The remaining 85 percent would be used to address the state’s homelessness crisis, thus the bill’s name. However, this is all speculation until they collect the needed number of signatures to get it on the November ballot, which they are yet to accomplish.
The ballot proposition would also allow tribal casinos to offer roulette and dice games such as craps. However, the tribe-state compacts would need to be changed before these games could be provided.
Card rooms have been left out of the sports betting debate, so they are lobbying for legislation that would enable online and retail sports betting at tribal casinos, race tracks, horse tracks, and professional sports arenas.
Despite being the most inclusive of all initiatives, tribes have not well received it and have not garnered much traction in terms of signatures from Californians.
What it Means When the Measures Will Be Opposed
Taxpayers Against Special Interest Monopolies lead the fight against the idea. The campaign, together with a now-defunct PAC called No on Gambling Power Grab, raised $25.29 million.
The California Commerce Club, Hawaiian Gardens Casino, Park West Casinos, The Bicycle Hotel & Casino, PT Gaming LLC, and Knighted Ventures LLC were among the biggest funders of the opposition.
Non-tribal casinos that have been excluded from the lucrative sector are likewise vehemently opposed to the policies.
Dozens of people have come together to establish the “No on the Gambling Power Grab” political group, which raised about $1 million last year, including top contributions of $155,000 apiece from Bicycle Casino in Bell Gardens, Hollywood Park Casino, Parkwest Casinos, and Hawaiian Gardens Casino.
California Gambling Association President Kyle Kirkland blasted the proposal in a statement, calling it an extension of the sponsoring tribes’ “untaxed monopoly on gaming” in California.
A “no” vote means that sports betting in California, as well as roulette and dice games in tribal casinos, would remain illegal.
The Force Behind the Campaigns Ballot Initiative
The Coalition to Authorize Regulated Sports Wagering is in support of the ballot proposal. Several American Indian tribes have joined the alliance, including the top campaign funders, the Pechanga Band of Luiseno Indians, Yocha Dehe Wintun Nation, Federated Indians of Graton Rancheria, San Manuel Band who belongs to the Mission Indians, and Agua Caliente Band of the Cahuilla Indians.
The total amount raised during the campaign was $12.93 million.
California has sought to legalize online gambling several times. Daily fantasy sports (DFS), one of the popular forms of esports, are allowed in California, but they are not recognized as online betting. Despite significant progress, efforts to allow online sports betting are yet to materialize.
Given the state’s complex politics, it is unknown when increased gambling, including internet gaming, will take place. Since residents of the state are free to gamble at offshore casinos, the state is losing a significant amount of cash as a result of internecine fighting.
Eastern states such as New Jersey, Pennsylvania, and now New York took advantage of the opportunity and are reaping the advantages. Will California finally get its chance this year?
More states are riding on the bandwagon, which is brimming with much-needed income generated by sports betting. Will the pressure from other states getting online affect the Tribes and California legislators? We’ll see what happens.