California Sports Betting Likely Delayed Until At Least 2022

The nation’s largest potential sports betting market won’t start taking bets until at least 2022 after a campaign to put legal wagering on the 2020 ballot was suspended due to the coronavirus outbreak. California’s constitution requires a statewide voter-backed amendment, which now can’t come until the 2022 midterm elections at the earliest.

Sports betting in California faced long odds even before the 2020 ballot measure efforts were suspended. Now it will be years before the most coveted market in American sports betting can begin.

Stakeholder Conflicts in California

California’s commercial card rooms, Native American casinos, and elected officials have sought legal sports betting since even before the Supreme Court struck down the federal ban in May 2018. Nearly two years later, after nearly half the state legislatures in the country have passed sports betting bills, the divisions between the gaming stakeholders have kept California sports betting Illegal, despite popular and political support for the concept of sports betting in general.

The tribes and cardrooms have battled over online poker and in-person card games for more than a decade. Sports betting is just the latest front in those clashes.

Under California law, the tribal casinos would first need to earn nearly 1 million voter signatures for a constitutional amendment referendum question to appear on the 2020 ballot and that would then need a majority of voters to approve the question. The tribes introduced that ballot measure last year that would exclusively allow in-person betting at Native American casinos statewide – and not at the more than 80 cardrooms across the state.

That effort ended with the state’s shelter in place restrictions enacted due to the coronavirus. Referendum backers needed to collect the signatures by April for the legalization question to appear on the ballot, but that initiative was suspended before they reached that total.

That means the tribe’s incentive won’t appear on the November 2020 ballot. The next scheduled statewide elections aren’t until 2021.

As Native American gaming interests advanced the petition, lawmakers were working on a rival measure that would amend allow cardrooms to take sports bets. That too would require a ballot measure, but referendum originating from the General Assembly requires a two-thirds majority vote in both chambers instead of voter signatures.

It faced an uphill climb from its inception due to the tribes’ influence in Sacramento. With the 2020 legislative session also suspended indefinitely, it seems politically implausible for a legislature-backed ballot measure to make this year’s ballot.

California Sports Betting Future

Even when the legislature reconvenes and ballot initiatives are permitted to continue, California sports betting still has an uncertain future.

With laws that give the tribes the rights to wagering options such as sports betting as well as major financial and political influence, it’s difficult to imagine a situation where they allow other entities to pursue sports betting without a fight. Tribal interests will likely restart the signature collection process to get a similar referendum as the 2020 measure on the 2022 ballot.

The cardrooms will likely continue supporting the legislative route, as difficult as that might be. Passing the supermajority threshold for any vote is a challenging endeavor. This becomes even more daunting against tribal interests in the General Assembly that, for now, seems strong enough to block any legislation. Backers of cardroom sports betting access will likely continue pushing lawmakers, but the multi-year legislative stalemate will likely continue.

Native American groups behind the ballot measure told the San Francisco Chronicle that before the shelter in place restriction, they were on pace to reach the signature mark ahead of the April deadline. There are good odds a similar effort will make the 2022 ballot, but the ensuing public vote is hard to determine. Gambling in any form still remains a difficult proposition to advance in a country where it remains taboo for many. Meanwhile, cardrooms, horse tracks or other gaming interests left out of the measure would likely seek to campaign against the referendum, putting its fate in jeopardy.

Should voters approve sports betting in November 2022, it would still take months before the tribes could begin taking bets, even though some casinos and sportsbook operators already have deals in place if, or when, sports betting is legalized.

These agreements underscore the interest in California, the world’s fifth-largest economy, even when the prospects for sports betting in the near future remain dim. Online wagering proposals in Texas, Florida and New York have all stalled, meaning California remains arguably the single major target for global gambling interests. The blow to what seemed like an inevitable ballot measure means those interests will have to wait for at least several more years.