The march toward a legal sports betting platform in the state of California is picking up steam. Three proposals have emerged with a group of high-level gambling providers joining the state’s tribes and cardrooms as groups submitting proposals to launch what is sure to be a robust and lucrative legal sports betting platform.
California’s state attorney general’s office is preparing a petition on behalf of a group of seven elite gambling providers for the Secretary of State. That petition mandates one million signatures before a proposal can appear on the 2022 election ballot. The plan, called “Californians for Solutions to Homelessness and Mental Health Support” fancies itself as a hybrid model that will bring tribal entities into their mix, while at the same time directing profits to a hot-button social issue in the state of California.
Who Are the Providers Involved?
There is a group of seven that have thrown their immense weight behind the “Californians for Solutions to Homelessness and Mental Health Support” in order to get their sports betting proposal on the 2022 ballot. Bally’s, BetMGM, Fanatics Betting & Gaming, Penn National/Barstool Sportsbook, Wynn, and the two DFS giants have teamed up to start a process of legalization in the biggest-fish state in the nation.
The coalition has taken a measured approach in their proposal. Their plan has left off “betting” and “gambling” in their wording so as to not confuse it with the two other competing proposals. The Californians for Solutions to Homelessness and Mental Health Support aims to direct profits to an issue plaguing Californians with 85% of total revenue is to be dedicated to homelessness and mental health efforts under the proposal.
“Permanent solutions require a permanent funding source. The California Solutions to Homelessness and Mental Health Support Act will raise hundreds of millions of dollars annually to fight homelessness and expand mental health support in California by allowing regulated entities to offer safe, responsible, sports betting online,” Dana Williamson, a veteran political strategist who advised former Gov. Jerry Brown said.
The Prized California Market
The California market is viewed as the biggest prize in the US market. Immediately, 40 million Americans from the highest populated state in the country would be eligible to place a bet and all of the state’s fifteen professional sports teams would be put on an even playing field as a number of their counterparts.
Chris Grove, managing director for Eilers and Krejcik Gaming said, “California is easily the largest prize in the U.S. sports betting market.” Analysts from BetMGM called the state “one of the most important betting markets in the world.”
Altogether, California figures to bring in about $200 million in revenues for the state from taxes and licensing fees off the bat. Upon maturity, that number could swell to as much as $500 million per year.
Getting the Tribes in Board
It is no secret that California’s Native Tribes have a lot of say as to what a legal sports betting platform would look like in the state. They control gambling entities already in California – sports betting would be an extension of their current platform and build on their sports betting plan that as of now includes just retail sports wagering.
The “Californians for Solutions to Homelessness and Mental Health Support” aims to include the tribes as part of their mobile betting initiatives. The sports betting provider proposal hopes to compliment the tribes’ aspirations and build on them going forward.
“Any online sports betting operator seeking to participate in the California marketplace must do so by partnering with a California tribe,” Campaign Manager Dana Williamson told Politico. “A portion of the measure’s revenue is dedicated to uplifting Tribal communities.”
The plan includes a $100 million licensing fee for mobile providers with tribes that wish to “go it alone” is expected to ante up just $10 million. At the end of the day, a mobile sportsbook would have to belong solely to a tribe or would have to at least align with a tribe in order to be licensed.
The Chances
There are three reasonable proposals that will likely go before voters in 2022, each has merits. But the latest one by “The Seven” gambling providers appears on its face to be the most comprehensive, the most lucrative for all entities including tax coffers, and the most accessible for the wagering public.
The “Californians for Solutions to Homelessness and Mental Health Support” also recognizes and vows to help with what is a growing and identifiable problem facing Californians. It isn’t just a “betting proposal”.
With the question of US legal sports betting viability scheduled for a vote in 2022, the earliest Californians would be able to bet on their favorite team won’t come until 2023. The good news however is that things appear to be moving in that direction.
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