Will Sports Betting Ruling Be a New Gold Rush for California?

Will Sports Betting Ruling Be a New Gold Rush for California?

That sound you hear is the rush of California politicians and various moneyed interests racing to try and take advantage of a recent Supreme Court ruling paving the way for sports betting in every state.

On May 14, the Court struck down a federal law passed in the early 1990’s that prohibited states – except Nevada, of course – from authorizing sports gambling.  At the time, it was thought that betting on sports interfered with the integrity of professional athletics in the U.S.

But how times have changed.  ESPN reports that U.S. professional sports leagues like the NBA and Major League Baseball, despite public opposition, are working behind closed doors to welcome legalized sports gambling – if they get a cut of the revenue.

Gambling has an interesting history in California.

Voters approved a state lottery in 1984 and a state constitutional amendment in the late 1990’s authorizing the Governor to negotiate compacts with Native American tribes to operate casinos on federally-recognized tribal land.

I remember visiting one of the early tribal casinos – the Chumash Casino in Santa Ynez.  Back then, it was literally a barn with slot machines, a few card games, and a bingo parlor.  Today, Chumash and several other tribal casinos are 5-star resorts, complete with gourmet dining and A-list entertainment.

Every now and I then, I enjoy taking a drive on a Saturday out to Cache Creek north of Sacramento or the Red Hawk Casino near Placerville.  Spending an afternoon at either of these casinos is a close facsimile of spending an afternoon at a Reno or Tahoe casino – and you don’t have to fly or drive several hours to get there.

One of the things that I enjoy most about the California State Fair is the thoroughbred racing that only takes place at Cal Expo during the 2-weeks of the fair.  It’s fun to read the racing form and make a $2 bet on some horse you know nothing about other than its colorful name.  Surely such facilities and other legal gambling establishments across the state could handle legalized sports betting, as well.

Assemblyman Adam Gray, who is the chair of the Assembly Governmental Organization committee, announced that he is drafting a constitutional amendment to legalize sports gambling.  During my time in the Assembly, I worked for the vice-chair of that committee, which despite its benign name oversees horse racing, gambling, alcohol, and tobacco issues.

Gray told the Sacramento Bee that “it’s time to bring this multi-billion-dollar industry out of the shadows.”  In other words, it’s time for state and local governments and those they approved of to get their share of a $150 billion per year industry.

State and local governments already get a cut of the revenue generated at California’s tribal casinos under the terms of the negotiated compacts.  They are drooling at the prospect of getting revenue from legalized sports gambling in California.

The looming debate will be an interesting one.  Everyone in the gambling world – tribal casinos, cardrooms, bingo halls, racetracks, and online gambling entities – will be lined up at the State Capitol in the coming weeks trying to get their cut of the pie.

If California can handle betting at racing tracks, gambling at tribal casinos, and the state lottery with few problems, it seems a logical next step that lawmakers and voters will be able to forge a path to legalized sports betting in the Golden State.

Tim Anaya is communications director for the Pacific Research Institute.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.