Another window to legalize California sports betting in 2024 could be a one-horse race. Will state tribal leaders consider another shot at a retail-only sports betting initiative?
The tribes’ attempt at passing similar legislation last year (Proposition 26) fell well short of passing, with just 30% voter support. But even more tribal money went to defeating Proposition 27, which would have made online sports betting legal. Prop 27 received less than 18% of the vote.
With both sports betting proposals failing in spectacular fashion, it was thought that both tribes and national sportsbooks would wait several years before asking voters to approve sports betting in California.
Out-of-state sportsbooks still licking their wounds
Despite the failure of the two sports betting proposals on the ballot in 2022, it’s still a question of when, not if, California sports betting becomes legal. Until then, Californians can use apps like Fliff to make sports wagers using virtual cash that can later be redeemed for real dollars.
In the 2022 election cycle, tribes spent almost $250 million to defeat Prop 27, which DraftKings, FanDuel and BetMGM strongly supported. And certainly, they will spend hundreds of millions of dollars to do it again if necessary.
DraftKings CEO Jason Robins heard the message loud and clear, saying there was too much tribal opposition to attempt another California campaign in 2024 – and maybe in 2026, as well
Without the nation’s largest sportsbooks trying to enter the market, the tribes have a clear path to gain ballot access. There’s a lot of work to be done between now and then, though.
Tribes will face many obstacles if they seek another sports betting proposal
After losing at the polls in 2022, time continues to tick for the tribes to compose a new, and more importantly, improved initiative.
This requires tribal leaders to come together and agree on one unified plan that considers numerous complex factors, including past failures. If not, their efforts are doomed from the start.
Another factor must be the potential revenue difference between online sports betting and its retail counterpart. How much will it move the needle if operators want to keep wagers restricted to brick-and-mortar locations?
How much will it cost to try?
If the tribes come together, their initiative will need to collect more than 546,000 signatures in 180 days to qualify for ballot access. Then comes campaign funding and the biggest hurdle of all: Convincing the rest of the state why this time is different.
2024 may be too soon to approach voters again
Ultimately, tribal leaders would need to turn around a comprehensive proposal within the next few months to get the ball rolling on the 2024 election. Even with out-of-state operators on the sidelines, the tasks listed above are too much to tackle in a short timeframe.
Plus, the tribes have nothing to lose by maintaining their exclusive rights to California casinos, an industry generating billions of dollars in revenue annually.
Lastly, the tribes have too many pieces to pick up from their own defeat at the polls less than six months ago. Their measure flopped because it wasn’t good enough. Another half-constructed initiative will produce another failed result, which might open the door for out-of-state sportsbooks to try again.
Tribes should take as much time as they need to reconstruct a new plan, considering other states’ models in the process. They need to consider every angle and provide an attractive proposition for voters. Going from 30% to a passing majority will require it.
Future solutions exist if tribes and operators work together
Most likely, the earliest realistic chance at legalization will come in 2026. If tribes and sportsbook operators want in on the action, their best bet is to work together.
One solution could be allowing operators to provide the technology for tribal-owned sportsbooks. Online sports betting accounts for around 90% of all wagers nationwide and would be the biggest draw to Californians if included in a legitimate proposition.
Under these conditions, tribes, operators and the state could each claim one-third of all revenue, creating an attractive proposition for everybody.
At the end of the day, the tribes have the final say moving forward. They have the avenues to legalize sports betting if they want to. Until then, they can continue to cash in on their current gaming monopoly.