California Sports Betting Legislation Introduced

  • Constitutional amendment proposal to legalize sports betting now in committee stage
  • One bill calls for retail sports betting at tribal facilities, racetracks; another for online sportsbooks
  • Both would need two-thirds support in Senate and House to make it onto November ballot
  • Public would also have to support motion with two-thirds majority to pass it into law
Two bills have been introduced in a state Senate committee aiming to legalize retail and online sports betting in California. [Image: Shutterstock.com]

Bills land in Senate committee

A constitutional amendment proposal in California that would legalize sports betting in the state has been sent to the Senate Governmental Organization Committee. Introduced Thursday, the amendments modify two bills put forward last June in order to fill in the implementation details those bills lacked.

Every licensee would be able to host a mobile sports betting skin

The bills would permit retail sportsbooks at racetracks and on tribal land. Every licensee would be able to host a mobile sports betting skin. 

The amendments need two-thirds support of both the Senate and the House in order to get put in front of voters. If this happens, they would likely be on the November 2020 ballot. 

A closer look

Each of the state’s four horse racetracks could have a single satellite betting facility.

The initial licensing fee would be $5m for online sportsbooks, with an annual renewal fee of $1m. Retail sports betting gross revenue would be taxed at a 10% rate, while online sportsbooks would be on the hook for a 15% tax. An additional 1% of sportsbook revenues would go toward funding problem gambling programs in California. 

One of the other key components of the proposal is to officially recognize the legality of player-dealer games in California card rooms. This is likely a necessary concession to the card rooms, as they are would not be included in the state’s sports betting industry. There has been no comment yet from the California Gaming Association, the card rooms’ representative organization.

Tribes are opposed to card rooms spreading player-dealer games as they believe these offerings are in violation of the tribal exclusivity deal for house-banked games in California. The state’s tribes also want exclusivity for roulette and dice games.

People would have to be at least 21-years-old to place a sports bet

Potential economic benefits

Assemblyman Adam Gray and Senator Bill Dodd believe that sports betting would generate between $500m and $700m in revenue for the state each year as the industry matures. They cited the economic fallout from the ongoing COVID-19 pandemic as a primary driver behind the need to take action as soon as possible.

it will allow us to regulate a practice that happens anyway”

Senator Dodd said: “Revenue from sports wagering will help us avoid teacher layoffs and painful cuts. At the same time, it will allow us to regulate a practice that happens anyway.”

The sponsors of the amendments say that revenue from sports betting could help support key programs that will struggle for funding because of the pandemic. Legalization would also remove money from the pockets of black market operators that handle billions of dollars each year. 

Bills date back to last summer

Amendment SCA 6, proposed by Senator Dodd, complements the ACA 16 bill of Assemblyman Gray. These two bills were originally proposed back in June 2019, at the time only outlining a plan to hold a state referendum on sports betting legalization. They would require a two-thirds majority of voters to become law. 

A separate sports betting legalization proposal from the state’s tribes looks like it will not get enough signatures to be part of the ballot in November. It needs to receive 997,139 valid signatures by June 25. The ongoing pandemic, however, has severely hampered this effort as residents have been under stay home orders. There has not been any announcement of an extension to this deadline.