Since the spring of 2018, when the US Supreme Court overturned the Professional and Amateur Sports Protection Act of 1992 (PASPA), the legalization of sports betting has exploded across the 50 states. There are currently 38 states offering legal and regulated sports betting action.
Among the 12 holdouts, though, remains the most heavily populated state in the union. The Golden State is still holding. California, the state that brought America the craze of the Gold Rush in the late 1800s, isn’t anxious to go all out in pursuing the sports betting pot of gold. There are currently no legal and regulated California betting apps in operation. And that situation doesn’t look as though it will be changing anytime in the near future.
With a population of 38 million, all of the leading sports betting sites currently operating in the USA are hopefully awaiting the doors to swing open in California. Such a development could be a massive boost to the state’s e-commerce economy. But will it ever happen? No one seems to know that answer.
People Rejected Sports Betting
As recently as November of 2022, a proposal to offer legal and regulated sports betting was on the election ballot in California. In fact, two separate pro-gambling initiatives gained the necessary 997,139 signatures required for placement on the November 8, 2022 ballot.
There was California Proposition 26 – the Legalize Sports Betting on American Indian Lands Initiative. This tribal-backed proposition would’ve seen legal and regulated in-person wagering on sports set up to operate at some 80 tribal casinos and horse racing tracks across the state.
As well as sports betting, this proposal would’ve also legalized roulette and craps to be added to the tribal casinos already operating in California. At the present time, California’s tribal casinos are only permitted to offer slots, lotteries and card games, all in-house. There is no legal and regulated online gambling in California.
There was also Proposition 27, the California Solutions to Homelessness and Mental Health Support Act. This was a straight up proposal calling for the statewide legalization of online wagering.
Some heavyweight players in the industry were the backers of this proposal. That group included major USA betting sites such as BetMGM, DraftKings, Bally’s, FanDuel, Penn National, WynnBET, and Fanatics. They stockpiled a war chest of $500,000 to support the initiative and bombarded the state’s airwaves, calling for people to back Proposition 27.
This initiative certainly would’ve proven a boost to California’s e-commerce economy. The proposal came with a promise that 85% of all revenue earned from online gambling would go directly into the government coffers as part of a new fund created to help with homelessness and mental health operations in the state.
There was also a tribal casino element to this proposal. Any online sports betting site launching in California would’ve been required to partner with a tribal casino in order to be eligible for an operating license.
Neither proposition came close to gaining approval. Proposition 27 got just 17% of the vote, with a resounding 83% of Californians voting against the plan. As for Proposition 26, it was also defeated soundly by a 70-30% margin.
“I’ve been in the industry from the jump, and I’ve never seen anything like this,” Bill Pascrell III, a veteran gambling industry lobbyist, told Calmatters.org. “The kind of money they spent and the results they got are just terrible.”
Tribes In Control Of California Gambling Market
The Viejas Casino in Alpine California is owned and operated by the Viejas Band of Kumeyaay Indians. (This file is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported license).
California’s 50 tribes and tribal organizations campaigned strongly against Proposition 27. They’ve held a monopoly on legal and regulated gambling in the state for decades and aren’t about to willingly surrender that dominance.
And, as the major betting sites would discover, they are a very powerful lobby in the state. “You don’t come and try to screw the tribes,” Victor Rocha, conference chairperson for the national Indian Gaming Association, told Calmatters.org. “Everybody knows this.”
For the state’s tribes, ensuring that Proposition 27 was defeated became a far more important mission than getting their own Proposition 26 approved.
“The reality is, we didn’t undertake any meaningful advertising for (the in-person measure)” said Jacob Mejia, vice president of public affairs for the Pechanga Band of Indians. He depicted the online sports betting measure as “the biggest threat to Indian gaming in a generation.”
In California, all of the state’s casino gambling is controlled by the state’s 69 tribal casinos. They operate in excess of 70,000 slot machines and some 2,000 table games.
What Online Sports Betting Could Mean To California E-Commerce
You only need to look at how much of a boom online sports betting and online gambling in general has been in some of the other major states in the USA to see what legalization could mean to e-commerce in The Golden State.
In New York, the third-most populated state in the union, a record $2.11 billion was wagered online on sports in November of 2023 alone. In 2023, Pennsylvania’s yearly online gambling revenue was in excess of $2.1 billion. Pennsylvania is the fifth largest state in the union.
According to the American Gaming Association, online casino gambling across the USA generates $8 billion in annual revenue.
Estimates are that online gambling could contribute $500 million annually in revenue to state government coffers in California. However, if that’s going to happen, it’s unlikely to be happening soon. Industry insiders believe it’s already too late to get a new Proposition to legalize online gambling in California in time for the 2026 election cycle. That would mean the earliest anyone in the state could hope to see legal and regulated gambling approved would be 2028.