Sports betting initiative basics
Online sports betting
Backed by gaming companies
- Allow adults 21 or older to bet on sports events online outside of Native American tribal land
- Enable tribes to offer online sports betting under the tribe’s name and branding. Tribes would have to pay a one-time $10 million licensing fee to the state and $1 million renewal fee every five years
- Allow gaming companies such as Fanduel and DraftKings to offer online sports betting if they strike a deal with a tribe to access the California market, pay a one-time licensing fee of $100 million plus a $10 million renewal fee every five years, and they are also licensed to operate in 10 states/territories (or are licensed to operate in five states and operate 12 casinos)
- Impose a 10% tax on all companies or tribes offering sports betting. After covering the state’s regulatory costs, most of the revenue from the tax and the licensing fees would be used to address homelessness and create interim and permanent housing. Of the funds, 15% would go to Native American tribes that aren’t involved in online sports betting.
- Create a new division within the state’s Justice Department to regulate online sports wagering
- Applies a 15% tax to people who place illegal sports bets online, and gives the justice department additional powers to address illegal sports betting.
Fiscal ImpactCould generate funds in the mid-hundreds of millions for the state annually. It could cost the state tens of millions in new regulatory costs. (Source)
Tribal sports betting
Backed by tribes
- Expands betting games tribes can legally offer to dice games — like craps — and roulette
- Allows tribal casinos and the state’s 4 horse race tracks to offer sports betting. At race tracks, sports betting could only be offered to people over 21, while restrictions on sports wagering at tribal casinos would depend on the terms of the casino’s tribal-state compact.
- Levies a 10% tax on sports bets placed at race tracks, and requires tribes to reimburse the state for the cost of regulating sports betting
- After covering the cost of tax collection, the funds generated would go to the department of public health for problem gaming and mental health research, to the department of justice for enforcement of gaming rules, and to the state’s general fund.
- Creates a new civil enforcement tool for certain gaming laws, allowing anyone who becomes aware of certain violations to file a civil action and seek up to $10,000 in penalties per violation.
Fiscal ImpactCould generate tens of millions of dollars each year for the state. It would also create new enforcement and regulatory costs for the state, with the latter expected to be in the low tens of millions annually. (Source)
Credit: Grace Gedye & Erica Yee, CalMatters