Analysis: Differences In Three California Sports Betting Initiatives

Posted on October 25, 2021
1
Written By on October 25, 2021

Sports betting in California will be the biggest chip in US sports betting to fall if it is eventually legalized.

That could happen next November if voters want. There potentially are three ballot initiatives that would legalize CA sportsbooks, one of which is already on the ballot. The other two still need to collect signatures.

California sports betting would look and operate quite differently depending on which initiative voters hypothetically choose. The California state constitution needs to be amended to create legal sports betting, creating the need for the measures.

One proposal would authorize no mobile licenses while another would likely authorize too many. The third would charge a hefty $100 million fee for each non-tribal mobile license.

First California sports betting proposal from tribes

California’s gaming tribes submitted 1.4 million signatures for a proposition that would legalize limited sports betting in California.

Tribes wield a great deal of political power in California, where they own exclusivity over a variety of gaming activities. The 18-tribe coalition called for retail sports betting at tribal casinos and horse racing tracks.

Tribes want five to 10 years of that retail exclusivity before mobile would go live, California Nations Indian Gaming Association Chair James Siva said earlier this year. Launching mobile immediately could hurt tribes that cannot find a partner, he added.

There would be no betting on in-state colleges. Sports betting revenue would be taxed at 10%.

Plenty of CA sportsbook licenses in second proposal

Multiple cities with cardrooms formed a coalition and submitted a proposal in August that would create enough retail and mobile licenses to go around.

Pro sports teams, cardrooms, horse tracks and tribal casinos could launch sports betting under the proposal. Cardrooms and tribes are not aligned on this proposal, though, continuing a long-standing feud between them.

There would be 19 licenses available from professional sports teams alone.

Tax rate change

The proposal initially called for a 25% tax rate, but that changed. The original link to the proposal is dead but a new link includes a proposal that calls for a 15% tax. Also due is another 1% of an operator’s gross revenue up to $10 million for problem gambling programs.

Operators would pay $5 million for the first license and $1 million every other year for renewal.

There would be no collegiate betting ban, but official league data would be required for in-game betting.

Sportsbooks behind third CA sports betting push

Seven sportsbooks created a coalition of their own to legalize mobile sports betting in California:

While California tribes are broadly not in favor of mobile sports betting, those behind the initiative must know something.

The proposal calls for mobile betting only through licensed tribal partners. A spokesperson said there will be at least $100 million spent on the campaign, which also shows confidence.

Operators would pay $100 million for the initial license and $10 million every five years to renew it. Tribes that want to run their own mobile sportsbook get a significant discount of $10 million for the first license and $1 million to renew. Those fees are on top of the 10% revenue tax.

An internal poll found 62% of voters would support the measure, with 25% in opposition, according to the coalition.

Matthew Waters Avatar
Written by
Matthew Waters

Matthew Waters is a reporter covering legal sports betting and the gambling industry. Previous stops include Fantini Research and various freelance jobs covering professional and amateur sports in Delaware and the Philadelphia area.

View all posts by Matthew Waters
Privacy Policy