California remains the largest untapped sports betting market in the United States—and indeed, the world. This status is unlikely to change in the foreseeable future; a breakthrough is improbable, at least until 2026 or 2028.
Since the U.S. Supreme Court ruled the Professional and Amateur Sports Protection Act (PASPA) of 1992 unconstitutional in 2018, there have been numerous attempts to legalize sports betting. PASPA had effectively restricted sports betting to Nevada; the Supreme Court’s ruling opened the door for the other 49 states, 38 of which have since taken the plunge. The absence of sports betting in California’s existing casinos is not for a lack of effort—the issue has been, and continues to be, a subject of intense struggle.
Online gambling is also prohibited in California. Within the shifting political landscape, proponents of legalizing online gambling often—though not always—seek to bundle it with online sports betting. The Supreme Court’s decision triggered the most significant expansion of the U.S. gambling industry since the legalization of “Indian Gaming”—a process as intense and chaotic as the historic “Oklahoma Land Rush.” Yet, for the past seven years, California has remained a tantalizing but out-of-reach market for industry giants like BetMGM, Caesars, FanDuel, and DraftKings. This ongoing stalemate is equally frustrating for those within California who hope to tap into this revenue stream—including lawmakers looking to collect tax proceeds from wagers, and tribal gaming operators eager to capture a share of the market currently flowing to nearby Las Vegas.
Why has it not happened yet? Among California’s approximately 73 gaming operators, the major tribal gaming entities have been unable to reach a consensus on what the state’s sports betting market should look like. For any proposal to pass, it must first secure their approval; otherwise, it will go nowhere. This has been proven time and again, most recently in 2022. Furthermore, some tribal operators fear that allowing online gambling into the market—much like a “camel getting its nose into the tent,” where setting a precedent makes subsequent control difficult—could lead to a decline in visits to their physical casinos. Mobile sports betting.
A recent proposal backed by Native American tribes was originally intended to authorize only in-person sports betting. Currently, in the nation’s most populous state—home to nearly 40 million people—the only legal forms of sports betting are horse racing and “Daily Fantasy Sports” (DFS). DFS companies like FanDuel and DraftKings naturally aspire to offer sports betting services here, just as they do in other U.S. states where such wagering has been legalized.
This has also fueled the rise of “social casinos” in California; over the past five years, online platforms like Chumba Casino and Pulsz California have proliferated. California residents are frequently bombarded with advertisements for these types of casinos.
These websites offer free-to-play casino games with the chance to win cash prizes, all while remaining compliant with California’s laws prohibiting online gambling. More importantly, they have planted the seeds for gambling on mobile platforms—even though these games typically do not involve actual monetary transactions.
Caesars Sports
Shortly after a 2018 U.S. Supreme Court ruling, California Assemblymember Adam Gray—who had been anticipating such an opening—introduced a state constitutional amendment (ACA 18), but the effort failed. In 2019, Gray, alongside State Senator Bill Dodd, made another attempt by introducing a new constitutional amendment. To qualify for the 2020 ballot, the measure required a two-thirds majority vote in the state legislature. Ultimately, this attempt also proved unsuccessful. In November 2019, 18 Native American tribes involved in the gaming industry submitted a proposal titled the “California Sports Wagering Regulation & Unlawful Gambling Enforcement Act.” The proposal aimed to legalize in-person sports betting and impose a 10% tax on such wagers. However, the onset of the global COVID-19 pandemic in the United States early the following year forced these efforts to be put on hold for several years.
This proved highly unfortunate for a tribal coalition known as the “Coalition to Authorize Regulated Sports Wagering,” which had received authorization on January 22 to begin collecting signatures to qualify a measure for the 2020 ballot. The coalition included several of the state’s largest tribes that operate gaming enterprises: the Rincon Band of Luiseño Indians, Wilton Rancheria, the Federated Indians of Graton Rancheria, and the San Manuel Band of Mission Indians. The state’s near-total “lockdown” hindered their operations, making it impossible to gather the required 1 million signatures by the original deadline. The tribes sued the state, resulting in an extension of the signature-collection deadline to October 12. A subsequent lawsuit led to a further extension, pushing the deadline to December 14. Ultimately, the tribes submitted 1.4 million signatures, successfully qualifying their proposal for the 2022 ballot.
As a result, the “California Sports Wagering Regulation & Unlawful Gambling Enforcement Act” appeared on the November 2022 ballot as “Proposition 26.” Proposition 26 would limit sports betting to physical locations; this stems from concerns that allowing online sports betting could divert foot traffic away from brick-and-mortar casinos.
Proposition 27, meanwhile, was put forward by out-of-state gambling companies, including leading sports betting operators such as BetMGM and FanDuel.
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