When Will Betting Be Legal in California?

You might have heard the news that starting December 31, 2016, sports betting will be legal in California. The bill to allow this new form of wagering was signed by Governor Jerry Brown on August 1, 2016, and took effect on September 28, 2016. The new law allows for any of the 43 NCAA sports to be wagered upon, including football, basketball, and baseball. It also permits parlay betting and online betting. While this is certainly great news for the hundreds of thousands of Californians who regularly place bets and follow sports, there are still a few unanswered questions.

When Will Legal Sports Betting Be Available For California Residents?

According to the California Legislature, legal sports betting will start on December 31, 2016. The initial rollout will be available at casinos and racetracks, but online betting will be available as soon as September 28, 2016, the day after the law takes effect. However, you must have a business license to operate as an online sports bookmaker. If you don’t have one, then you cannot legally operate an online sportsbook in California.

Additionally, there is a cap on the amount of sports betting that will be available to people in California. The state government has set the cap at 5% of all gambling revenue, which, according to the state’s budget office, is around $250 million per year.

What Are The Most Popular Sports In California?

Of the 43 NCAA sports, 22 are available for betting in California. The most popular ones in the state are, in order of popularity, as follows:

  • Football
  • Basketball
  • Baseball
  • American Football
  • Auto Racing
  • Hockey
  • Golf
  • Tennis

It should be noted that while horse racing is legal in California, there is no such thing as ‘legal sports betting’ in the state. Since 1994, it’s been legal for race tracks to accept wagers on horse races, but the state government still controls the legality of wagering on sports.

What States Have Legalised Sports Betting?

The first state to legalize sports betting was Nevada in 1993, and since then, nine other states have followed suit.

In 2014, the Supreme Court ruled in New York State Bockting Association v. Ice that states could legally force sports books to accept wagers from New York residents, even though the sports books were physically located in another state. As a result of this decision, 11 states, including California, now allow for legal sports betting. There are currently 33 states where legal sports betting is available.

How Will This Affect The Las Vegas Market?

The legalization of sports betting in California will cut into the hundreds of millions of dollars that are bet on sports in Las Vegas annually. In 2015, the total amount of money wagered in Nevada on sports was $16.7 billion. That’s 80% of the state’s entire gross domestic product. The only other state with a comparable economy to Nevada is New York, which accounts for around 12% of all wagers placed in the country.

With the passage of Assembly Bill 204, California residents will now have access to over 200 million dollars worth of sports betting opportunities, which is a huge impact on a state that is already heavily reliant on gambling for its economic well-being. The new law will also provide a revenue stream to the state, which can be used to fund various social programs.

What About Parlay Betting?

In some states, such as Nevada and Massachusetts, parlay betting is allowed, but in other states, it is not. California is one of the 12 states where parlay betting is legal, and under the new law, it will be available to residents, starting on December 31, 2016.

Parlay betting allows for multiple wagers to be made on the same game. For example, a gambler could place a wager on the outcome of the game, as well as on the team’s score. In Nevada, parlay betting is available at casinos and racetracks, but it is not possible to place such bets online.

What About Online Betting?

While there are significant restrictions on online betting in California, i.e. you must be physically located in the state to place bets there, the law does allow for remote wagering. Under the new law, online betting will be available in 41 states, including California. However, only certain websites that are licensed as online sportsbooks can accept wagers from residents of California and other restricted states. Hence, it is still not possible to place a wager online from a casino or a racetrack in California, assuming that you do not live in one of the 11 other states where such wagering is currently legal.

Where Can I Place My Sports Bet?

In addition to the above uncertainties, there are also restrictions on where you can place your sports bet within the state of California. You must bet at a casino or racetrack near you, assuming that you reside in the state. You also cannot bet at a foreign-owned property, like a hotel or restaurant, or at a business that is owned by someone outside the USA.

Do I Need To Register With The State To Bet On Sports?

In most states, including California, you are required to register with the state to bet on sports. In California, this must be done online through the state’s Sports Wagering Internet Registry. In other words, in California you cannot legally operate a sports book, or take any wagers, whether online or at a casino, without first registering with the state.

How Does This Affect My Friends Or Family Who Live In Another State?

If you have friends or family who reside in another state and would like to be able to bet on their favorite sports teams, then the answer is you can no longer do so. Allowing for legal sports betting in California will, in most cases, require that the state’s officials monitor and regulate sports betting, including ensuring that the funds are safeguarded and handled correctly. Since 1994, when New York State Bockting Association v. Ice was decided by the U.S. Supreme Court, allowing for legal sports betting has resulted in a patchwork of regulation that varies from state to state. Now that California has followed suit and allowed for legal sports betting, it’s time for the federal government to step in and set standards that will ensure fair play and honest practices throughout the industry.