Priciest Legal Sports Betting Ballot Prop in US History Doesn’t Pay Off in California

Voters overwhelmingly rejected sports betting initiatives by Native American tribes and the gaming industry

Bets being placed during the NCAA Men's College Basketball Tournament.
California won't be getting on on legal sports betting in 2022.
Ethan Miller/Getty

A bet of more than a half-billion dollars by Native American tribes and the gaming industry that voters in the nation’s most populous state would go all-in on legal sports betting and other gambling initiatives failed to cash at the polls on Tuesday.

Californians caused the most expensive ballot proposition gamble in U.S. history to come up bust as voters in the state overwhelmingly rejected initiatives to legalize sports betting at tribal casinos and legalize online and mobile sports betting that would have been operated by companies like DraftKings and FanDuel. According to The Associated Press, nearly $600 million was raised to help support the competing efforts and both got less than 30% of the vote.

“They are spending hundreds of millions because billions are on the line,” Democratic consultant Steven Maviglio told The AP before Tuesday’s vote. “Both sides stand to really get rich for the long term. [It could become] a permanent funding source for a handful of companies — or a handful of tribes.”

Although wagering on horse races, at Indian casinos, in cardrooms and on the state lottery is legal in California, the Golden State’s nearly 40 million residents were apparently uninterested in legalizing sports betting, which has been spreading across the country.

“Our internal polling has been clear and consistent for years: California voters do not support online sports betting,” said Yocha Dehe Wintun Nation tribal chairman Anthony Roberts. “Voters have real and significant concerns about turning every cellphone, laptop and tablet into a gambling device, the resulting addiction and exposure to children.”

Had the measures passed, they would have created the biggest sports betting market in the U.S. with annual projected revenues in the range of about $3 billion, according to projections by Eilers & Krejcik Gaming.

“I have never seen anything in my career that’s this big of a flop,” Macquarie Grou gaming industry analyst Chad Beynon told The Financial Times. “If they barely managed 30% [of votes] with hundreds of millions spent, how much more are they going to have to spend to get it passed? We are arguably further away from legal sports betting [in California] than we were before the campaign.”

Democratic Governor Gavin Newsom, who easily won reelection, didn’t take a position on either of the competing proposals. For now, backers will have to regroup and wait until they can attempt to get legal sports betting on the books in California in 2024.

Win the Ultimate Formula 1® Miami Grand Prix Experience

Want the F1 experience of a lifetime? Here’s your chance to win tickets to see Turn 18 Grandstand, one of Ultimate Formula 1® Miami Grand Prix’s most premier grandstands!