As part of an initiative that qualified for the November 2022 vote on Thursday, the Californians could legally bet on Lakers, Dodgers and Rams games in tribal casinos and racecourses, triggering an expected expensive battle with excluded card clubs against whom should benefit from the potential billion dollar market.
The constitutional amendment to allow sports betting was penned by Native American tribes who demonstrated their political power in 2008 when they spent $ 115 million to get approval of four electoral measures that preserved an expansion of the gambling that gave them their power Had been granted year earlier.
“This is an important step in enabling Californians to participate in sports betting while protecting against underage gambling,” said Mark Macarro, tribal chairman of the Pechanga Band of the Luiseño Indians, one of the 18 tribes to which they belong Coalition to approve regulated sports betting behind the electoral measure.
On the flip side, card clubs excluded from some of the sports betting are expected to spend a significant amount of money to oppose the new electoral measure they have described as an attempt to monopolize the gambling industry. The campaign committee, called “No on the Gambling Power Grab,” reported that it raised more than $ 1 million in cash contributions over the past year.
“This initiative does not help promote sports betting, but instead expands the tribal casinos’ tax-free gaming monopoly and rewards these operators for prioritizing their own assets over public health and safety,” said Kyle Kirkland, president of the California Gaming Assn.
California is late for the game. Three years after the US Supreme Court removed legal barriers to states that allow sports betting, wagering on soccer, baseball, basketball and other sports was legalized in 26 states, including New York, New Jersey, Michigan and Oregon. In November it was approved in Louisiana, Maryland, and South Dakota.
The stake in California is particularly high as voters decide whether to allow sports betting, said Chris Grove, executive director of Eilers and Krejcik Gaming, a research firm that advised lawmakers on the issue.
“California is by far the biggest prize in the US sports betting market,” said Grove.
Legalization could bring California roughly $ 1 billion in gross annual revenue excluding online betting – as the tribal initiative suggests – and $ 3 billion if the state expands it to include online betting, Grove estimates.
California is home to the most professional sports teams in the country, including five major league baseball teams and four National Basketball Assn. Teams, three National Football League franchises, and three National Hockey League teams. The state also has high-profile college teams, including those from UCLA and USC.
The State Legislative Analyst’s Office said the initiative would generate new spending regulating sports betting, but also a deluge of cash for state coffers.
“The magnitude of the increase in government revenue is uncertain, but it could reach tens of millions of dollars annually,” the LAO concluded in a financial analysis of the proposal.
The market could generate up to $ 500 million in tax revenue for the state annually, officials have estimated.
In other states, legalization is already paying off. According to Legal Sports Report, a sports betting industry news site, states that operate legal sports betting reported $ 54 billion in bets, $ 3.2 billion in revenue and taxes, and from June 2018 to May 2021 Generated $ 534 million in revenue with government agencies.
Pennsylvania generated the highest taxes and fees with $ 134 million, followed by New Jersey with $ 132 million and Nevada with $ 61 million.
In California, the coalition of 18 tribes filed 1.4 million signatures in October, and on Thursday the Secretary of State reported that the counties had reviewed more than 1 million to qualify for the constitutional amendment election.
The petition drive was successful despite government social distancing restrictions aimed at reducing the spread of COVID-19 since March 2020. However, she was assisted by a judge who extended the signature collection period to take account of the disruption.
The action started after the tribes successfully cracked down on state legislation last year that would have allowed sports betting more generally, including in non-tribal card clubs and state-sanctioned websites on the internet.
Grove said the chances of the legislature reaching an agreement with the various interested groups on a plan to allow online sports betting remain long.
“Online betting is a controversial issue and it will continue to be difficult to find consensus among stakeholders,” he said.
According to the constitutional amendment, sports betting would only be permitted in person in tribal casinos and state-licensed racetracks and only by people aged 21 and over.
Betting would be allowed on professional, extra-state college or amateur sporting events, but wagering would be prohibited on high school sporting competitions and sporting events attended by a California college team.
The measure would impose a 10% tax on gross gaming revenue derived from sports betting on racetracks, with the money being used for public safety, mental health programs, education and regulatory costs. Tribal casinos would provide some of the revenue to the state to at least cover the regulatory costs that need to be negotiated with the governor.
The measure would also make craps and roulette possible in Native American casinos.
The sports betting initiative is sponsored by the California Thoroughbred Breeders Assn. Supported, said spokeswoman Robyn Black, who said she would help racetracks become more financially successful.
“I think it will help keep jobs in California for brick and mortar businesses rather than just massively opening up the internet,” she said on sports betting.
A 1933 constitutional amendment allowed betting on the live sport of horse racing, the only sports betting allowed to date, noted Justin Fanslau, a circuit representative.
“The California horse racing industry attracts tourism, supports thousands of jobs, and preserves critical open spaces, family businesses and small businesses in the state,” he said, adding that the initiative “is well given in light of previous actions by California voters in granting racetracks Makes sense “Exclusive rights for sports betting and the tribes exclusive rights for casino betting. “
California voters have approved legalized gambling three times: by creating a statewide lottery in 1984 and by approving tribal casino operations with elections approved in 1998 and 2000.
In 2008, gambling interests and others spent $ 154 million to battle over the expansion of betting in Native American casinos. This is the third highest amount spent on California initiative campaigns in the state’s history.
Four Southern California Native American tribes spent $ 115 million in support of the state election campaign that sustained the expansion of gambling granted to them a year earlier.
The Pechanga gang of Luiseño Indians spent $ 46 million on the competition, the Morongo gang of Mission Indians $ 42 million, the Agua Caliente gang of Cahuilla Indians more than $ 20 million, and the Sycuan gang of Kumeyaay -Nation 6 million dollars. These four tribes and 14 others are behind the proposed new constitutional amendment.
To date, the tribal coalition has spent more than $ 11 million collecting signatures to qualify for the electoral measure.
In addition to the more than 50 non-tribal card clubs sponsored by the California Gaming Assn. Represented, the election measure is also likely to be rejected by the California Coalition Against Gambling Expansion, although the group’s board of directors has not yet taken a position.
“It’s an expansion of gambling and we just believe that gambling is a predatory industry that doesn’t improve communities,” said Fred Jones, the group’s attorney.