California offers a variety of legal gambling options, but there’s potential for expansion, particularly in sports betting and online gaming. However, achieving this expansion will require a careful balance of interests among stakeholders and would likely provide significant economic benefits to the state.
The landscape of gambling in California is already being shaped by ongoing debates about the potential alignment of interests among various stakeholders. However, a recognition of the economic opportunities presented by the state’s large and diverse population cannot be ignored. As with many states that have recently legalized sports betting and iGaming, legislative action and referendums will undoubtedly play key roles in determining the future trajectory of gambling in California.
Here’s a quick look at the current options available to players within California, and what the future could hold for the industry in the Golden State.
Legal Gambling Options in California as of August 2023
First things first, is betting legal in California? The answer: Yes, kind of. Compared to states like New York (with a range of sports betting options) or Pennsylvania (one of the few states to have legal online casinos), players in California are quite limited in what they can gamble on. But that’s not to say it’s impossible; there are still a few events residents can bet on and some gambling games they can enjoy. For example:
Betting on horse racing is legal in California, and the California Horse Racing Board regulates this industry, ensuring the integrity of the races and overseeing licensing. The state is home to several prominent racetracks, including Santa Anita Park and Del Mar Racetrack. Pari-mutuel wagering is permitted both on and off the track through licensed operators. It’s the only form of sports betting that’s currently allowed in CA.
Santa Anita Park is actually home to one of the most famous races in the world: The Santa Anita Handicap (you might have heard of it colloquially called the Big ‘Cap). It was once won by the world-famous Seabiscuit, highlighting the importance of California in the US horse racing calendar.
Daily Fantasy Sports (DFS)
Though some legal ambiguity has surrounded DFS in California, it has generally been tolerated. Various companies operate in the state, offering residents the opportunity to participate in daily and weekly fantasy sports contests. These platforms take around $200 million annually in entry fees, despite never being formally legalized or outlawed. Interestingly, CA is the biggest contributor to DFS, which just goes to show how much could potentially be wagered on real sports betting if and when it becomes legal in the state.
Tribal gaming is a significant part of the gambling scene in California, with over 60 such casinos currently operating within its borders. Many Native American tribes operate casinos offering slot machines, poker, blackjack, and other table games under federal law and state compacts.
California has many licensed card rooms where poker and other card games are played, though house-banked games are typically prohibited. Instead, players play against each other, rather than against the house as they would in traditional casinos. There are strict regulations surrounding these card rooms, but there are currently close to 90 in operation throughout the state.
The California Lottery, created in 1984, provides various games, and the revenue generated supports public education in the state. Popular games include scratch-offs and number draws like Powerball. These can offer considerable prizes, with some scratch-offs having a top prize of $5 million.
Bingo and raffles for charitable purposes are legal under certain conditions. There are measures in place to ensure that the profits from these games are used appropriately.
Future Expectations: Will More Gambling Options Become Available in CA?
The conversation about legalizing sports betting has been a hot topic in California. Given the size of the state’s population and its strong sports culture, the potential market for legal sports betting is enormous. Last year, the US as a whole set a record in gambling takings, with just shy of $55 billion in revenue. As the most-populated state by a long way, it doesn’t take much to imagine how much this figure could grow with the inclusion of California.
Legislators and stakeholders have introduced various bills to legalize sports betting, but they have faced resistance, primarily from tribal gaming interests. The collaboration between various parties is crucial for creating a legal framework that would serve everyone’s interests.
Should sports betting be legalized, California could become one of the largest markets in the country. This could lead to increased state revenue through taxation and licensing fees, potential job creation, and further development of the gaming industry in the state.
The prospects for online casino gambling remain similarly uncertain, but could follow the path of sports betting. If online gambling is legalized, it would again tap into California’s vast population, leading to considerable economic benefits. Although it has only been legal for a few years, online gambling takings reached the huge amount of $185.8 million in Michigan in May 2023—and this is in a state with a population roughly a quarter of that of California’s.
But, at the time of writing, there’s no set timeline for when sports betting could become legal in California. Even next year, 2024, seems unlikely at the moment. A constitutional amendment would likely be required, meaning another trip to the polls for voters. Sports betting remains illegal in California after the failure of Prop 26 and Prop 27 in the November 2022 election. A complicated web of interests between lobby groups, Native American tribes, and government stakeholders has hindered swift progress in legalizing sports betting in the state.
Powerful tribal entities have been identified as significant players in the legalization process, and the alignment of interests between various stakeholders will be a crucial factor moving forward—strong communication will be needed on both sides. Recent developments include potential legal actions concerning cardrooms and the launch of social betting platforms, but the path to legal sports betting in California remains steep and fraught with complexities. The large population and potential market make the situation even more compelling and challenging.
Those eagerly awaiting legal sports betting in California might have to wait considerably longer, given the intricate and sensitive landscape of interests and the failures of the 2022 propositions.