The Push to Legalize Gambling in California is Now on Hold

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Highway and roads are seen near Los Angeles International Airport May 7, 2014 in Los Angeles, California. AFP Photo/Brendan Smialowski

If you thought the Golden State was on the verge of legalizing sports betting, you’re California dreaming.

The latest attempt failed after Kasey Thompson, one of the ballot initiative’s leaders, said they would no longer pursue the effort due to opposition from Native American tribes.

Let’s review Thompson’s recent endeavors and explore the implications of the tribes’ rejection for online sportsbooks.

Time to Quit

Thompson and Reeve Collins, the two business people behind the effort, say they’re not moving forward to get at least 874,000 signatures necessary to get the question of legal sports wagering before voters on the 2024 election ballot.

The decision is due to insufficient support from the California Nations Indian Gaming Association (CNIGA) and various tribes across the state. As a result, the prospect of legalizing sports betting is on hold until the next legislative session, which won’t happen for another two years.

Two Sports Betting Initiatives With One Goal

There were two initiatives created, Propositions 26 and 27, that would have allowed California’s governor to negotiate agreements with tribes and set up a framework for both in-person and online sports betting.

One of the initiatives included a proposed amendment, which would move tax funds for homelessness initiatives to both gaming and non-gaming state tribes. On top of that, over $600 million was raised to support the two ballot measures through fundraising efforts.

Despite all of this, CNIGA offered significant resistance and publicly expressed disapproval of sports betting initiatives. CNIGA went as far as releasing a public statement formally opposing these proposals.

Thompson says without tribal support, neither initiative has much hope to pass.

“We tried everything until the very end, but it looks like there would be money from the three big tribes against it, making it impossible to pass in a public election,” Thompson told Play USA. “The only thing I would create from here is a civil war.”

This isn’t the first time something like this happened. Similar measures failed two years ago.

Why CNIGA Opposes the Sports Betting Initiatives

Despite the amendment, CNIGA’s 52 tribes vehemently opposed the initiatives. Partly because it included requiring participating tribes to pay up to 25% of sports wagering profits to non-participating tribes and up to 1% to the state for regulatory costs.

In a statement, CNIGA Chairman James Siva said, “We are pleased that in the face of widespread tribal opposition, the backers of two initiatives have kept their word and withdrawn what we could only regard as a cynical attempt to legalize sports wagering and online betting in California. These initiatives attempted to use tribes’ good names to cleanse illegal offshore, online gambling corporations with an appalling track record of malfeasance.”

Siva also warned anyone thinking about trying to create similar measures. “Let this failure also be a warning to others that seek to dubiously enter the California gaming market. Using tribes for your own gain will get you nowhere.”

What Is Next for the Sports Betting Fight in California?

Californians are now unlikely to see sports betting on the ballot until at least 2026. However, Siva thinks it will be longer. He has said publicly that he doesn’t see it happening until at least 2028.

We’ll continue to follow the developments. Stay tuned.