How California’s Online Gaming Laws Differ from Other States

california gambling laws

In 2018, the U.S. Supreme Court overturned the federal retail and online sports betting ban. The decision led half the country to pass legislation that legalized some form of online sports wagering.

Before that, between 2003 and 2006, the gaming industry experienced a poker boom in the U.S. The trend ignited with Chris Moneymaker’s $1.2 million win at the World Series of Poker (WSOP).

Moneymaker had earned his seat at the WSOP via a satellite tournament he won online.

Gamblers looking to become the next big winner include those in California, one of the world’s largest economies.

Here’s how California’s gambling laws differ from other states.

Tribal Casinos

California Tribal casinos hold sway over dozens of land-based properties. Native tribes won autonomy after the Supreme Court decided in 1987 that the government couldn’t regulate Indian gaming.

The landmark case of California v. Cabazon Band of Mission Indians led to the passage of the Indian Gaming Regulatory Act in 1988. The Act created the National Indian Gaming Commission to regulate gambling on Tribal lands.

It also designated the following classes under its regulatory authority:

  • Class I – traditional Indian gaming; social gaming
  • Class II – games of chance (bingo); non-banked card games (against other players)
  • Class III – all other forms of gaming (blackjack, craps, roulette, slots, etc.)

As of 2016, Tribal casinos in California generated $8.41 billion in gross gaming revenue. 

By December 2022, the 85 casinos supported almost 125,000 jobs, with a tax impact and a Tribal revenue share worth $3.45 billion. California Tribal casinos impacted the state’s economy by nearly $20 billion.

Some of the top land-based properties include the Yaamava’ Resort & Casino. As the largest casino in California, it hosts more than 7,000 slots and 150 table games across 290,000 square feet of gaming space.

Sports Betting in California

Gambling laws in California typically rely on referendums and constitutional amendments. In 2022, voters rejected Propositions 26 and 27, which would’ve legalized in-person and online sports betting.

Tribal casinos sought to get first dibs on the state’s legalization of retail sports betting and California racetracks. However, opponents decried a monopolization effect, especially in the state’s low-income areas.

Prop 27 would’ve legalized online sports betting. While more than half the country already passed sports betting legislation, Prop 27 failed, with over 80% voting ‘No.’

Out-of-state operators, including some of the largest companies in the gaming industry, got behind Prop 27. In-state lobbyist groups contributed nearly double in political fundraising and advertising campaigns to oppose the amendment.

With stalled legislation into 2024 that could take years to launch, that makes online gambling sites in California an excellent option.

Online Gambling Options for California Players

California represents the world’s fifth-largest economy. Online players in the state must rely on offshore gambling sites to place their wagers.

International gambling licenses remain affordable in offshore gambling-friendly jurisdictions. Areas include Gibraltar, the Isle of Man, Malta, and Curaçao.

These areas license and regulate smaller gambling companies providing online platforms to players worldwide. Online gambling laws in California occupy somewhat of a legal gray area.

For that reason, online players must research reputable offshore gambling sites before making a deposit. Offshore oversight allows players to deposit and withdraw in various cryptocurrencies.

With crypto, California players at offshore gambling sites access faster deposits and withdrawals with lower fees. Some places even offer crypto welcome and reload bonuses.

Horse Racing

California offers some of the country’s most unique gambling laws regarding horse racing. Proposition 5 legalized pari-mutuel wagering on horse racing in 1933.

Pari-mutuel betting derives from the betting volume on any outcome. That style of betting gets used in various race tracks worldwide.

In 1971, Hollywood Park pioneered the exacta wager. To win an exacta, a bettor must correctly guess the first two horses to win the race—in that order.

Again, the exacta wager applies to modern horse racing as one of the most popular bets.

In the mid-1980s, California opened its first off-track betting (OTB) facilities. Live OTB telecasting started in 1985. Out-of-state bettors could place wagers on California horse races.

In July 1994, the Hollywood Park Casino opened as a “racino,” or a casino attached to a race track. The legal framework for racinos remains popular in the U.S. today.

Famous racetracks in California include Santa Anita, Del Mar, and Los Alamitos.

Card Rooms

Another way California gambling laws differ from other states comes from card rooms. Regulated by local governments, card clubs fell under the jurisdiction of the California Gambling Control Commission with the passage of the California Gambling Control Act in 1997.

Local card rooms must secure a gaming ordinance at the local level to become legal. They must then get approval from the state.

In the Gambling Control Act, the state implemented a moratorium on new card rooms from forming and previous ones from expanding. The state legislature extended the moratorium in perpetuity for decades.

On May 22, 2023, California Governor Gavin Newsom extended the moratorium until 2043.

The Future of Gambling in California

Tribal casinos continue to maintain a near-monopoly on gambling in California. The state’s unique gambling laws also helped promote horse racing’s prestigious history.

It’s difficult to tell if or when California voters might legalize in-state and online sports betting. Meanwhile, players get access to reputable offshore gambling sites.

In the future, California may continue to host one of the most unique gambling markets worldwide.

  • Post published:August 18, 2023
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