California is one of the most highly coveted sports betting states in the US.
Its population base is over 40 million, there are 19 professional sports franchises, and it has a rich history of collegiate sports. Not to mention the state is a tourism hot spot.
If ever there was a state primed for legal sports betting it would be the Golden State.
Is sports betting legal in California?
No. There is no legal sports betting in California. States, on the West Coast and the East Coast and everywhere in between, have legalized sports betting. But California still can’t decide what to do. The problem is that legislators can’t pass any laws to allow sports betting in California until after the matter has been voted on in a referendum.
It appeared as if Californians would voice their support or opposition in November 2020. But a proposal to legalize online and retail sports betting met its demise due to contention from tribes. Speaking of, a coalition of tribal gaming leaders amassed enough signatures to get their proposal on the 2022 ballot, though they are pushing for the referendum sooner. That ballot measure authorizes retail wagering only, and only at tribal casinos and racetracks.
Why California needs sports betting
Americans do love to bet on sports. And other Americans do love to try to stop them. The tension between the two sides of the argument came to a head in 1962 with the passage of the Wire Act and the Professional and Amateur Sports Protection Act (PASPA) in 1992.
The first created a federal ban on using telegraphic communications to place sports bets across state lines. The second banned any states from introducing new sports betting legislation if they didn’t already have it in place. In 2011, the Department of Justice (DOJ) changed its opinion on what the Wire Act meant, restricting it only to sports betting. The upshot was that states were allowed to introduce online gambling so long as it was not sports betting. California online gambling is not yet a reality.
In 2018, the Supreme Court ruled that PASPA was unconstitutional since it contravened states’ rights guaranteed by the 10th Amendment. States were free to legalize sports betting, both live and online, so long as it didn’t cross state borders. New Jersey was one of the first to take advantage, launching sports betting mere weeks after. Other states have rapidly followed.
The reasons given for this enthusiasm are twofold: consumer protection and increasing state revenue. When gambling is regulated and legal, the operators must put in place consumer protection measures or lose their license. While it may look like legalizing sports betting is the liberalization of gambling, in practice, it is actually a restriction of gambling. Players can bet in a safe casino environment and at-risk gamblers can get support. Also, financial protections are in place. And, as a legal activity, sports betting is taxable, which could close the vast hole in California’s public finances.
Online sports betting is an essential part of legal sports betting
Legal sportsbooks, as a taxed industry in the state, raise revenues for the state. Regulated markets, in turn, protect consumers. It cannot be done without also legalizing online sports betting. More than 80% of sports betting is now done online or on mobile devices. If mobile sports betting is not legal, then bettors will continue to place wagers at unlicensed unprotected, unregulated offshore sites.
State revenues will be much lower than desired because the legal industry is not capturing much of the market.
Are there plans to regulate sports betting in California?
Short answer — yes, there are plans to regulate online sports betting in CA. However, the road to legalization might be a long journey. The legislative route made it appear as if a bill would reach the 2020 ballot, which, if approved by voters, could have allowed lawmakers to get the gears in motion for a 2021 launch of online and retail sports betting.
While California cardrooms approved, tribes very much opposed the measure as they have long fought against cardrooms and their offerings. As such, the bill’s sponsor killed the measure, bringing an end to state-backed hopes. Now only the tribal plan remains in play.
There are estimates that a tribal-state sports betting compact would generate between $250 million and $500 million a year to the state coffers, depending on the final tax rate.
Who will regulate sports betting in California?
This question requires a bit of context involving tribal conflicts in California. There are 109 officially recognized tribes in California, and 60-plus of them operate tribal casinos. Between them, they generate revenues of more than $7 billion a year. They include casinos, casino-resorts, and mini-casinos. Between them, they offer more than 70,000 slot machines and 2,000-plus table games, which is more than any other state in the union.
Not unnaturally, the tribes are extremely protective of their interests. They generally oppose internet gambling since they think it may reduce the number of visitors to their casinos. They guard their right to offer casino games in California and take all available measures to prevent the state’s card clubs from expanding into their casino space.
Overall, the tribes want sports betting, but they want it on their terms. With this information in mind, it’s hard to imagine a scenario where only the state of California regulates sports betting. Everything points to a joint compact between the tribes and California.
How old do I have to be to bet on sports in California?
The legal minimum age to gamble in California is 18 years. However, in practice, most casinos set the minimum age limit at 19 or 21 years. CA law allows casinos, card rooms, and other gambling locations to set their age limit as long as they are at least 18 years. Particularly, where alcohol is for sale, the age is often 21 years.
The same spread of minimum ages will be there for sports betting. If you are planning to visit a casino or cardroom, it is wise to check the minimum age on the website or call customer service. Future legislation will likely determine the minimum age for mobile sports betting. It may be 21 years or older. We will just have to wait and see.
Which sportsbooks will offer legal sports bets in California?
California is such a significant potential sports betting market that every big brand operating in the US will want to take a piece of the action. However, predicting which operators will launch when the time comes can be quite challenging.
Based on extensive research in other jurisdictions where sports betting is legal, we can piece together a general picture of which sportsbooks we think will launch in California. There are effectively two types of companies offering sports betting: ones that provide sports betting to customers under their brand, and those that provide the technology or software.
The names you will almost certainly see if they can get access to the market will be:
- DraftKings Sportsbook
- BetMGM Sportsbook
- FanDuel Sportsbook
- William Hill Sportsbook
- PointsBet Sportsbook
- Caesars Sportsbook
- BetRivers Sportsbook
All are already active in the US market, and all will try to find a California sports betting partner.
What would retail sports betting look like in California?
The California Gaming Control Board states that there are 59 tribal casinos and a number of racetracks, creating a large pool of locations where retail sports betting could take place. Traditionally, retail sportsbooks are located inside casinos complete with food and drinks. Some properties, like the sportsbooks in Indiana, have betting kiosks in addition to a physical betting window.
When sportsbooks do arrive in California, and they aren’t legal yet, the majority will be at the state’s tribal casinos. Any joint compact between the tribes and California’s government will focus on that.
How online sports betting might look in California
Taking a trip to a casino is a great day out. For many Californians, it’s an expensive trip, not worth it if you just want to place a small bet.
Online operators are happy to accept small wagers, which is one of the reasons why they are so popular in states with legal mobile sports betting. The other main advantage is that you can place bets from the comfort of your home, sitting in front of the game with a few drinks and some friends.
If online sports betting arrives in California, you can set up a sports betting account in a matter of minutes. In some jurisdictions, such as Nevada, the law states that you must set up your account in person at a casino. Since California only has tribal casinos, it is unlikely it will go this route. However, in places like New Jersey, customers have the freedom to sign up for sports betting accounts from anywhere in the state.
How to sign up for an online sportsbook account
Signing up for a sports betting account works the same way regardless of what state you are in. Personal details will be required to prevent any chance of underage gambling or placing a bet outside state lines. The personal info usually includes the following:
- Name
- Date of birth
- Address
- Social Security number or last four digits
After you have chosen a screen name and password, you are ready to place your first bets. If you open your account using a mobile device, you will need to download the sportsbook app. After that, the process is the same as signing up from your desktop.
Then when you want to bet using your mobile, you simply enter your login details and your app will automatically take you to your account.
Will you have to be in California to place a bet?
Yes. If and when California does legalize sports betting, you will need to be within the state when you place your bets. Online gambling is regulated at the state level, not the federal level, so California law no longer applies when you leave the state. One step across the border and you are no longer legally allowed to wager on your mobile device with a California licensed operator.
This means geolocation will most certainly be required in California. This technology not only prevents customers from placing bets outside of California, but also ensures that all the tax revenue generated from sports betting stays in the state. If you set up an online sports betting account in California, you can only use it to make bets inside the state borders.
Geolocation technology is accurate, so if you try to place a bet, the software will refuse to accept it.
Potential deposit options in California
Once live, the online sports betting operators will offer as many ways as they can to allow customers to make deposits. In some states, the laws even stipulate that operators must accept specific payment methods. Just like an online bank account, you can always check your deposit from the sports betting client.
When you place a bet, funds are taken from your sportsbook account, and any winnings will credit to it. The operators will provide a complete transaction history on request. There are several options to deposit funds in other legal sports betting states. They include:
- Credit and Debit Cards: This is the most popular way to deposit funds. It works like making an online purchase. Sometimes banks refuse to accept gambling transactions, which is why other methods of deposit are available.
- Prepaid Cards: Most online operators now offer a branded prepaid card. You first transfer money to the card and then use it like your debit card to deposit funds into your account. Much like a loyalty card, a prepaid card often comes with extra benefits.
- Wire Transfers: For bettors who want to deposit a large sum of money, some books recommend using a bank wire transfer.
- E-Checks: E-checks are like mini wire transfers and are extremely quick and easy to use.
- PayPal, Skrill and Neteller: The big-name payment processors are widely accepted at online sports betting sites. Deposits and withdrawals process quickly. A physical card comes with these accounts, so you can use a teller machine to withdraw your funds as cash.
- Cash: There are two ways to deposit using cash. If you are close to a casino, you can deposit funds into your online account from the partner casino’s accounts cage. Alternatively, the PayNearMe service offers deposits through kiosks at 7-Eleven stores.
- Check or Money Order: Handwritten checks and money orders are still popular with a few people. Although checks take longer to process than other methods, they are still accepted widely.
Placing bets on California sports teams
When and if sports betting is in California, the regulator decides what counts as a sport eligible for betting. Betting on the Oscars may or may not qualify, but being California, that would certainly add an extra frisson to the annual ceremony. In the end, California will likely allow bets on the major pro leagues as well as college sports.
Of course, the more contentious sports are those involving local teams. California is likely to make exceptions to ensure there is no betting on high school sports or any sports involving minors where they are the majority of participants. Esports are also unlikely to be on the agenda, but after that, most sports will qualify.
One restriction (that is as much operator-imposed as a regulatory issue) is that less popular sports are only likely to offer betting on significant events. Cycling and the Tour de France may be one example, or the Olympic Games, where there could be exceptions for the occasion. Bets on team sports in the Olympics may be OK, but judged events will not.
With all this information in mind, there is a high probability residents and guests to California will be able to place bets on all 19 professional sports teams located in the state.
Those include:
- Los Angeles Angels (MLB)
- Los Angeles Dodgers (MLB)
- Oakland Athletics (MLB)
- San Diego Padres (MLB)
- San Francisco Giants (MLB)
- Los Angeles Chargers (NFL)
- Los Angeles Rams (NFL)
- San Francisco 49ers (NFL)
- Los Angeles Lakers (NBA)
- Los Angeles Clippers (NBA)
- Los Angeles Sparks (WNBA)
- Golden State Warriors (NBA)
- Sacramento Kings (NBA)
- Anaheim Ducks (NHL)
- Los Angeles Kings (NHL)
- San Jose Sharks (NHL)
- LA Galaxy (MLS)
- Los Angeles FC (MLS)
- San Jose Earthquakes (MLS)
Common bet types we expect to see in California
Some of the types of bets on offer in California will be:
- Moneyline: These are wagers on which team or player will win. They are the simplest bets in the bookmaker’s arsenal and the easiest to understand.
- Spreads: These take moneyline bets a step further. In a spread bet, you don’t bet on the winner of the game; you bet on the difference between the final scores of the two teams involved in the game. The bookmaker decides the most probable outcome, and you bet on whether the team will beat the spread. This happens when they win by more than expected or lose by less.
- Totals: Which team will win is irrelevant in a totals bet. Here, you are betting on the combined total of both teams’ scores. The bookmaker sets a line; then, you bet that the total score will be above or below the line. That’s why these bets are also called over/under bets.
- Futures: You can argue that every bet is about a future outcome, but a futures bet takes it further. A futures bet is on something a long way off, such as who will win the NBA championship or which player will score the most home runs in a season.
- Parlay: These wagers are a great way to get a lot of entertainment and the chance of a big payout from a small initial bet. In a parlay, you select the winners of several games, usually all taking place on the same day. If you get one winner wrong, you lose your stake. The odds of getting five, six or more winners correct are very low, so if you do pull it off, you get a big multiple of your original wager.
- Round Robin: These bets are a lot more complicated than parlay bets, but work on a similar principle. In essence, a round robin ties together multiple parlay bets. To make this bet, you choose a list of teams and determine how many legs you want in each parlay. Your bets are on every combination of parlays among the list of teams. You don’t have to win every leg of the round robin to win some money. You win when each combination wins regardless of what happens to your other combinations.
- Teaser: This is just like parlay bets, but the legs of the parlay are only on totals bets or spread bets. The twist is that the bettor can adjust the totals or points spread lines to make a bet easier or harder to win. Of course, the odds then change, so again, big payouts can come from small wagers.
Will in-play betting be allowed?
In play betting or live betting is rapidly becoming the favorite way to bet. When you have a bunch of friends watching a game together, a few small in-game bets can enhance your enjoyment of the game and give everyone a stake in the outcome.
The data that sports betting operators have now is so good — at least for major events — that they can adjust the odds of bets in response to the action on the field almost instantly. Sports bettors gain a lot of advantages. If you place a bet on your home team to win, but it looks like they are going to lose, you can now bet on the opposing team to hedge your original bet.
Events during the game are now the subject of betting, such as what the total score will be at the end of the next quarter. Instead of placing a bet in advance of knowing the final team line-up for a game, you can wait until after it has started, secure in the knowledge that unforeseen injuries haven’t turned the odds against you. It’s with complete certainty that live-betting will be a part of California sports betting. However, the odds of in-play betting on collegiate sports is highly unlikely.
Background on California sports betting
California voters approved the expansion of legalized gambling three times. The California lottery was created in 1984, and tribal casino operations became legal after ballot measures in 1998 and 2000. A year later, cardrooms successfully lobbied to expand from only offering poker games. The state gave them the authority to offer card games, such as blackjack and Pai Gow, with one caveat: Players must act as the bank, not the house. There are now approximately 89 cardrooms, according to the California Gaming Control Board (CGCB).
Since 2001, not much else has happened for gambling or sports betting in California. Over the last few years, there have been several attempts to get legislation through. As a result of political disputes or the efforts of the cardrooms and tribal gaming lobbyists, progress has stalled.
November 2020 ballot measures and other legislative options
Assemblyman Adam Gray, who chairs the Governmental Organization Committee that is responsible for gambling, introduced a sports betting bill and a constitutional amendment in 2017. Both attempts went nowhere.
Last year, Gray tried again by filing ACA 16 in June. State Sen. Bill Dodd filed the Senate equivalent bill SCA 6, the measure that ultimately fell to the wayside. Meanwhile, 18 tribes that own central casinos put into progress their plans that would limit sports betting to tribal casinos and racetracks.
To get on the ballot, the California Legalize Sports Betting on American Indian Lands Initiative needs 997,139 valid signatures verified by June 25. This effort should be easy given the resources the tribes have at their disposal. That will get their measure on the ballot paper in 2022.
