California Could Turn to Sports Betting to Boost Revenue

California Could Turn to Sports Betting to Boost Revenue
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With California facing a massive budget deficit and billions in cuts because of the coronavirus pandemic, two state lawmakers are looking to legalize sports betting to help raise tax revenue.

Adam Gray, a state assemblyman from Merced, said the state could help add revenue by increasing gambling options.


RELATED: More on California gaming


“It certainly won’t solve our budget crisis, but given the incredible impacts of the coronavirus on our bottom line, these proposals provide some flexibility,” Gray said this week, according to calmatters.org.

Bill Dodd, a state senator from Napa, and Gray would like to see a constitutional amendment calling for a statewide sports betting referendum on the November ballot, according to the Associated Press. Their bills, first presented nearly a year ago, would allow tribal casinos and horse racetracks to offer sports betting. It includes retail and mobile wagering.

The state would tax sports betting gross revenue at 10% for retail gaming and at 15% for mobile or online, AP reported.

Dodd’s amendment is scheduled to be heard Tuesday in the Governmental Organization committee, which he chairs.

But increasing gaming in California has always been a tough road because of the intense competition between the tribes and card rooms, which have table games like poker and blackjack. In the legislation, each would receive expanded gaming options to try and appease the other.

The California legislature, which had recessed because of the pandemic, returned this week to work on passing a budget. It must do so by June 15. Gov. Gavin Newsom has to sign the budget before July.

It would take a two-thirds vote to put the sports betting measure before voters, according to AP. It would then have to be approved by a majority of voters.

“Revenue from sports wagering will help us avoid teacher layoffs and painful cuts. At the same time, it will allow us to regulate a practice that happens anyway,” Dodd said in a statement.

Tribes Trying to Get Measure on Ballot

The original California stay at home order has had an effect on the state's tribes getting enough signatures to have a sports betting measure on the November ballot. The tribes need about a million valid signatures to get the question on the ballot and the signatures need to be verified by the state.

With California residents banned from public contact, getting the required signatures for sports betting and other ballot initiatives could be difficult, according to the San Francisco Chronicle.

In addition to seeking sports betting to help the revenue crisis, the gaming market in California would likely be one of the largest and most robust in the country. California has a population of nearly 40 million (highest in the nation), 16 professional sports teams and a technology epicenter (Silicon Valley).

Three other states will have referendums on sports betting on the November ballot — South Dakota, Maryland and Louisiana.

The California proposal has a long way to go in the legislature before it’s in front of voters, but it’s a start.

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