These States Unlikely to Legalize Sports Betting Any Time Soon

A recent 50-state review of sports betting found that California, Florida and Texas are not likely to offer sportsbooks any time soon. 

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The Associated Press reveals that legalization efforts are nonexistent or very unlikely to happen anytime soon in the nation’s three most populous states, which together hold more than a quarter of the U.S. population.  Those living in any of these states can still access internationally licensed online sportsbooks, many of which have been in business for 20 plus years now.

The three most populous states in the nation - California, Texas and Florida - account for 27 percent of all franchises in four of the top professional sports leagues.

The sheer number of teams and their relative success make them fertile territory for legalizing sports gambling now that the U.S. Supreme Court has allowed every state to offer it.

“These states are the brass rings given the size of the populations and the potential opportunity,” said Sara Slane, a spokeswoman for the American Gaming Association.

A 50-state review of sports gambling legislation by The Associated Press reveals that legalization efforts are nonexistent or very unlikely to happen anytime soon in the nation’s three most populous states, which together hold more than a quarter of the U.S. population.

In California, the powerful tribal interests are reluctant to reopen their agreements with the state and potentially share the gambling market with other players, including card rooms and race tracks, according to the AP.

In Texas, a combination of political clout from out-of-state casino interests and social conservatives who are morally opposed to gambling have effectively killed any prospects for legalized sports betting.

In all three states, any attempt to allow sports gambling would likely require a statewide vote to amend the constitution — a high hurdle for any issue, much less an expansion of gambling.

“The dynamic at work here is the larger the state, the larger the market, the larger the opportunity — the more complex the stakeholder environment and the more political stasis sets in,” said Chris Grove, managing director of gambling research firm Eilers and Krejcik.

So far heading into the month of March, eight states have legalized sports betting.  Arkansas, New York and the District of Columbia also have legalized sports gambling in some form and are working on regulations before bets can be placed.  22 other states are considering some form of legalization that may or may not include online wagering.  Mississippi was among the first states to offer sports betting, but doing so online is only possible on the casino property whereas states like New Jersey offer a full suite of Internet sports betting options within state borders.  States like Rhode Island do not yet offer online betting.  There are two sportsbooks in operation in America's smallest state, both of which offer limited wagering opportunities.

When all is said and done, most experts believe that half the U.S. states will offer some form of legalized sports wagering.

California, which alone accounts for one-eighth of the U.S. population and has 17 teams among the four major professional leagues, will not be joining the sports gambling states anytime soon.

Gambling there is largely controlled by casino-operating tribes that have compacts with the state. The tribes that are part of the California Nations Indian Gaming Association oppose an expansion of gambling even though it could bring more traffic to their casinos, said Steve Stallings, the group’s chairman.

The group is in the midst of a dispute with the state’s card rooms and doesn’t want to see more competition for the tribes by opening a debate over sports betting.

A similar dynamic is in play in other states, including Arizona and Minnesota, where bills that would allow tribes to operate sports betting are in danger, partly because many of the tribes oppose them.

In Florida, a major casino-operating tribe also is a key factor.

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Last year, voters agreed to make it tougher to expand gambling with a constitutional amendment that requires 60 percent voter approval for any future expansion of gambling in the state. The measure’s supporters included Disney, whose Orlando resort is a major economic force, and the Seminole Tribe, which owns seven of Florida’s eight tribal casinos.

State Senate President Bill Galvano, a Republican, said he believes sports betting could be legalized without voter approval, although he said he might ask for it, anyway. He said broader gambling legislation is being developed that would allow wagering, likely at racetracks, tribal casinos and perhaps in some form at sports venues.

“Sports betting has been taking place here, as it has other places, just not regulated and taxed,” he said.

Any attempt to push through legalization in Florida without voter approval would hit opposition and likely trigger a lawsuit, said John Sowinski, who led the campaign for last year’s constitutional amendment and leads the group No Casinos.

“Any sort of sober analysis of any type of gambling finds it doesn’t add anything to the economy,” he said. “It’s basically parasitic.”

In either case, Galvano said his bill is not likely to be a top priority during the 60-day legislative session that begins on Tuesday. Seminole Tribe spokesman Gary Bitner said in a text message that the tribe would not comment on the status of sports betting in Florida.

In Texas, there is a different dynamic taking place.  Social conservatives assail it as a regressive tax on the poor, and the official Texas Republican Party platform opposes expanded gambling in any form.

The biggest winners if Texas maintains the status quo are casinos in neighboring Oklahoma and Louisiana, whose operators are major contributors to Texas politicians.

Billionaire Tilman Fertitta, owner of the Golden Nugget casinos, has donated more than $500,000 to Texas Gov. Greg Abbott. Two Oklahoma casino empires, the Chickasaw Nation and Choctaw Nation, have given more than $5 million combined to Texas officeholders and candidates since 2006.

Rob Kohler, a lobbyist who opposes gambling as a consultant for the Christian Life Commission, said the consistently winning argument in Texas has been that gambling preys upon the poor.

“Dollars don’t come from the sky,” he said. “They’re coming out of people’s pockets.”

- Aaron Goldstein, Gambling911.com (The Associated Press was used for this article)