Sports betting slow in coming to California: Heres what it might look like – San Francisco Chronicle

A year and a half after a Supreme Court decision legalized sports betting across the country, California so far stands pat not yet letting state residents get in on the action and leaving potentially hundreds of millions of dollars in tax revenue on the table.

With the NFL season 7 weeks old and the NBA season starting this week, millions of football and basketball fans are unable to place bets on the 49ers, Raiders, Golden State Warriors or any other teams. While there are efforts to legalize sports gambling in the nations most populous state, its no sure bet, as concerns raised by established gambling industries stymie legislation.

Any plan to legalize sports wagers will require the cooperation of those interests and the approval of California legislators and, ultimately, voters.

A 2018 U.S. Supreme Court ruling struck down a provision in the federal Professional and Amateur Sports Protection Act of 1992, which prohibited states from authorizing sports wagers. Since then, more than a third of all states have rushed to cash in on the opportunity.

California is still not among them, but residents will get a chance to voice their opinions on sports betting in a series of hearings expected to be scheduled this month. State Sen. Bill Dodd, D-Napa, and Assemblyman Adam Gray, D-Merced, plan to announce hearings for later this year after introducing bills in June.

Casey Clark, a spokesman for the American Gaming Association, said the past year has been a time of monumental change in the sports betting industry. In a little more than a year, 17 states and the District of Columbia have legalized wagering on sports.

Theres been rapid, rapid growth, Clark said. Its been a remarkable time.

Gaming experts estimate that $150 billion in illegal sports wagers are made annually in the U.S. Legal sports wagers in California could generate a couple hundred million in tax revenue from about $10 billion in bets, said Paul Payne, a spokesman for Dodd.

So, whats the over/under on when California will allow fans to place bets on games? Where will these bets be placed? And who stands to win? Here are some possible answers to those and other questions.

What types of gambling are legal in California?

Californians can legally bet on numbers through the state lottery, card games at card clubs, horses at race tracks and most types of casino games at tribal casinos. Bingo games and charity raffles are also permitted. Bets between friends are fine; taking bets like a bookie is not.

Why would California legalize sports betting?

People betting on sports in California do so through bookies and offshore betting apps. Making sports wagering legal would give bettors better options and allow the state to collect millions in taxes and fees.

We know illegal sports gambling is happening, so why not bring it out of the shadows, regulate it and use it to raise money for educational programs? Dodd said. Its something that is now authorized under federal law and in other states, and I look forward to vetting ideas on how best to do it in California.

So far, there is no organized opposition to legalizing sports gambling in California. But groups that help problem gamblers are concerned that the spread of legal sports betting could worsen the problem. Online wagering, which would make gambling even easier, is a particular concern.

Where is sports betting legal?

In addition to Nevada, where sports wagering has been legal for decades, bettors can gamble on games in Oregon, Arkansas, Delaware, Indiana, Iowa, Mississippi, New Jersey, New Mexico, New York, Pennsylvania, Rhode Island and West Virginia. Lawmakers have given the go-ahead in Montana, Tennessee, Illinois, New Hampshire, North Carolina and Washington, D.C., but the details are still being worked out.

Online betting, with geofencing to prevent out-of-state bets, is legal in Nevada, Oregon, Indiana, Iowa and West Virginia, and Rhode Island is expected to roll out an app.

Active bills are in play in six more states, including California, and discussions are going on in nearly every state but Utah, which has historically avoided all types of legal gambling.

No one knows whether California will allow online bets or restrict players to brick-and-mortar casinos, race tracks or lottery kiosks. Mobile betting is considered likely, though.

What has to happen for sports betting to be legalized here?

California will require a state constitutional amendment before gamblers can legally bet on sports. Two-thirds of the Assembly and Senate would need to approve placing an amendment on a statewide ballot. Then a majority of voters would need to sign off. A 2018 attempt by Gray went nowhere.

The currently proposed amendment permits the Legislature to authorize and provide for the regulation of sports wagering. It makes no mention of who could take bets, what type of wagering could be allowed or how it could be regulated and taxed. Those details would be worked out by the Legislature after the amendment passes, but its more likely a plan would be negotiated beforehand to have better odds of winning approval.

Who wants in on the action?

At least three institutional players want a stake in controlling bets: tribal casinos, cardrooms and horse tracks. Pro sports leagues the NFL, NBA, NHL, MLB, PGA and Major League Soccer are also angling for a share.

A number of entities exist in the gaming space as well as in the sports space, said Adam Capper, a spokesman for Gray. The two worlds will have to come together and figure out how to exist.

Steve Stallings, chairman of the California Nations Indian Gaming Association, said the states 68 tribal casinos are interested in sports betting, but only if the state can properly regulate existing commercial gambling. The association is in a dispute with state regulators and card clubs over the types of card games and betting allowed in the clubs.

The tribes understand the industry and are positive about growth and expansion, but not expansion that would jeopardize tribes exclusivity (to offer casino games) or things we do now, Stallings said. We told the legislators we will discuss it, but we want details on tax rates, who would be eligible, how it would operate.

Becky Warren, a spokeswoman for the California Gaming Association, which represents the states 66 licensed card rooms, said her members are supportive, but the devils in the details.

The horse racing industry is interested as well, according to representatives of Golden Gate Fields in Albany. Enabling sports wagering could be as simple as the track reprogramming its race-betting machines to allow wagering on sporting events.

The machines are ready to go and so are we, said Ryan Hilton, a marketing manager for the track. Its the next step for us, basically.

But for anyone to take that next step, said Sam Spear, a Golden Gate spokesman, it will take an agreement among the tribal casinos, card clubs and horse tracks.

Weve been told that unless we get all three of the groups unified, it wont happen, he said. We shouldnt come to the legislatures until we have our act together.

What do the sports leagues think?

Most leagues used to oppose legalizing sports betting, fearing it would undermine the integrity of their games and leave fans uncertain the outcomes were real.

But as more states move toward legal sports wagering, the leagues have softened and said they want similar rules and regulations in each state. And, of course, theres money to be made.

The leagues have proposed integrity fees, which are essentially taxes on bets paid to the leagues, and theyre also looking at sales of data: everything from live statistics and information on betting lines at sportsbooks around the world to real-time information on bets being placed.

Such up-to-the-second updates would allow players to place bets continuously even play by play during games.

You could place a bet on whether the next player will get a hit, said Clark, of the American Gaming Association. That could be where were heading.

Will it be possible to legally bet on football in California next season?

Probably not. The proposed state constitutional amendment, if it passes the Legislature, would require an election in November 2020, deep into football season.

If the amendment passes as is, the Legislature will need to implement the new wagering scheme and get the show running. Any constitutional amendment would likely include operational details before going to voters.

What might sports betting look like in California?

Its safe to say it wont look like the sportsbooks of old, though some of those will still exist, perhaps inside stadiums and arenas.

Instead of strolling into a smoky, Vegas-style sportsbook with towering walls of oversize TV screens and electronic signs displaying the odds, many, if not most, sports gamblers will make bets from the comfort of their own homes or seats at, say, Chase Center or Oracle Park, using their mobile phones or placing gets with roving vendors, who might even have a new call: Popcorn! Peanuts! Place your bets!

Michael Cabanatuan is a San Francisco Chronicle staff writer. Email: mcabanatuan@sfchronicle.com Twitter: @ctuan

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Sports betting slow in coming to California: Heres what it might look like - San Francisco Chronicle