Sports Betting Gaining Traction In California
Sports betting in California was considered a dead issue just a few months ago, but the coronavirus pandemic has changed things. With the state now facing a budget deficit of $54 billion for the next fiscal year, lawmakers are looking to find ways to bring in more revenue.
Senators Bill Dodd and Assemblyman Adam Gray introduced a sports betting bill in 2019, but that bill stalled out before ever coming to a vote in either house. Now, Dodd and Gray have made some changes to their bill in hopes that the ultimate decision will come down to the voters in November.
To legalize sports betting in the state of California, an amendment would be needed to the state constitution. The state calls for a petition of nearly 1 million signatures before a referendum can be placed on the ballot, but lawmakers can work around that rule.
California Governor Gavin Newsom has introduced several major budget cuts to help lower the deficit, and that has left some lawmakers upset. Dodd and Gray have reportedly been gaining many supporters over the last few weeks, but it’s unclear if they have enough lawmakers on their side to make a change.
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Two-thirds of the legislature would have to vote in favor of the California Sports Wagering and Consumer Protection Act for the issue to show up on the ballots in November. If it does make its way to the ballot, a simple majority vote will legalize sports betting in the state.
There are 16 professional sports franchises in California, and these teams would drive the industry. Industry experts have estimated that California could generate more than $30 billion in wagers during the first full year that the industry is launched.
The legislature is running out of time to discuss and take a vote on this matter, and it’s unclear if the bill will get approved in 2020.
State Needs to Find Way to Grow Industry
If sports betting is on the ballot in California in November, experts expect it to pass easily. That would make the industry legal in the state, but that doesn’t guarantee that the launch will go as smoothly.
Other states were also expected to get sports betting passed easily, but that hasn’t always been the case. Colorado voters narrowly approved a sports betting referendum in 2019, although most lawmakers expected it to become a law by a huge margin.
If sports betting is passed by the voters, it will be up to the state to find a way to take advantage of the opportunity. Recreational cannabis was legalized in 2016 in California, but the black market is still more profitable in the state.
When recreational cannabis was legalized in 2016, the state immediately placed large taxes and fees onto the product, and the state has yet to see its full potential from the industry. Lawmakers will have to be careful not to do the same to sports betting. The top sports betting operators will turn away if they are forced to pay hefty fees.
Industry experts also caution that the sports betting industry will not take off if mobile/online wagering is not a part of the bill. Allowing tribal casinos to take bets on sports is a start, but many of those casinos are located away from major cities in the state.
The bill that is proposed by Dodd would allow for racetracks to offer sports betting, and they could also partner with online sportsbooks. California could become a sports betting giant if the state implements the proper rules, but there is still plenty of discussion that needs to take place.