California Assemblymember Adam Gray has filed a constitutional amendment to clear the way for the state to regulate sports betting, provided it is ratified by citizens in a statewide ballot.
ACA 16 would amend Section 19, Article IV of California’s Constitution of State to give the legislature the power to authorize sports betting regulation. This would clear the way for legislation to be introduced to establish a regulatory framework and tax system for the vertical.
Assembly Governmental Organization Committee chair Gray explained that the amendment was filed in response to the Supreme Court’s decision to strike down the 1992 Professional and Amateur Sports Protection Act (PASPA) in May last year.
“The US Supreme Court has shouldered the burden of bringing legal clarity to the issue of sports wagering and the rights of states under the Constitution,” he said. “Now it is the responsibility of the Legislature to determine the most prudent way forward.”
He noted that eight states currently allow legal wagering, with more than 35 considering legislative proposals. Sports betting was widely popular despite legal restrictions at federal and state level, with around $150bn bet on sports illegally each year.
“Whether we like it or not, Californians are already betting on sports through illegal and often unscrupulous websites in foreign countries,” Gray continued.
“It is time to shine a light on this multibillion-dollar industry. We need to crack down on illegal and unregulated online gaming and replace it with a safe and responsible option which includes safeguards against compulsive and underage gambling, money laundering, and fraud.
“All other gaming activities in California are subject to regulations that ensure the safety of consumers. Sports wagering should be treated no differently.”
The measure would have to be ratified by a two-thirds majority in a statewide referendum, with Gary aiming to have the measure put to voters at the state’s November 2020 elections. This would suggest that work on developing a regulatory framework would not begin until after this date.
A complementary amendment will be filed in the upper house of the California legislature by Senate Government Organization Committee chair Bill Dodd.
“I look forward to working with stakeholders in a collaborative effort to help bring this out of the shadows,” Senator Dodd said. “By legalizing sports wagering we can avoid some of the problems associated with an underground market such as fraud and tax evasion while investing in problem gambling education.”
After the bill was filed yesterday (June 27), the Assembly and Senate Governmental Organization Committees will conduct a series of informational hearings on sports betting throughout California. This will be used to give committee members the opportunity to gather a range of views on the matter from interested parties and external experts.