How To Lose $300 Million A Year Without Even Trying

This week, we're trying something new. Chas Filardi is an expert writing for VegasInsider and has decades of experience betting on sports, both in legal and offshore markets. (We do not recommend using offshore sites, but that used to be all that was available.)

Now that legal, online sportsbooks are the next big thing, Chas knuckled down and has made a name for himself as a full-time legal sports bettor, researcher, and sports writer. He lends his experience to Sports Betting Weekly, a thoroughly-researched show touting the benefits of being able to bet legally (and lamenting when he can't), and is contributing his wealth of knowledge to VegasInsider right here.

Let's see what Chas Filardi, a betting expert and longtime California resident, has to say about the Golden State's apparent inability to legislate betting:

California Sports Bettors Are Still Supporting Costa Rica

Current exchange rates show that for one US dollar you’re going to get 689.7 Costa Rican Colóns. Talk about an overlay! Probably one of the reasons why when gamblers from the Golden State make deposits into their offshore accounts it’s in crypto or dollars. 

Sure, you can send in your Colóns as a deposit, they just won’t accept it.

Considering the estimates of the California sports betting market, offshore books are getting a whole lot of those deposits– all made in US dollars. Those funds leave our economy lacking any tax liability and without the chance for any trickle down economics. In offshore sports betting, you don’t even get to pump up the local economy by tipping your ticket writer – and it might be that way for a while, too! 

There’s no changes available between now and the NFL season opener in Los Angeles. Sure, there’s some stadiums now that actually have a sportsbook in the building– just not in California. How can the largest state in the nation not have legalized sports betting? Other states are reporting over a billion dollars in handle every month. Some of them have less people than the city of LA alone!

We, and that’s an important aspect of this subject, should have never gotten to this point in history. It’s a story of greed and ignorance. You could even call it stupidity. When something is personal, maintaining the professionalism while writing through the anger is harder than it reads.

Stupid is a tough word to use effectively; there’s such a narrow range of parameters for something to deserve that description. The history of legalized sports betting in California comes close.

Who Bears The Responsibility For This Huge Case Of Ineptitude? 

Hey Google, what’s another word for monopoly?

It’s been two decades since California voters said yes to the tribes having casinos. Years later, it’s a billion dollar a year cash flow. Good for them! They have thriving businesses. 

Just like “it ain’t 1992 anymore” was a battle cry to overturn PASPA, maybe “enough is enough” should be on bumper stickers throughout the Golden State. Times change. Ask any small business owner that’s lost their business with a little help from Jeff Bezos. 

Many of the states where betting a couple bucks on your favorite team is already happening have legalized sports betting without needing the citizens to vote on it. Those elected representatives were actually able to do their jobs, move legislation through their state legislatures and put together something a governor would sign. 

When Will California Start Breaking Every Sports Betting Revenue Record Ever Recorded?

Sacramento, it seems, showed the power that lobbyists and special interest groups have in a democracy. The tribes have had a 20-year head start on helping candidates benefit from their revenue stream. If since the beginning of the century your party’s coffers have been padded by tribal offerings, which way would you vote?

Years of failed attempts to move sports betting legislation through the process meant any movement would have to come from the voter themselves. 

Local Indian tribes created a ballot measure to do just that; casino visitors helped to garner enough signatures and guarantee a place for a sports betting vote on the November 2022 ballot. The tribes' measure focused on their belief that they’ve been given an exclusivity on all wagering in California, and it should be the same thing with sports betting.

According to the tribal proposal for sports betting, you'd be able to bet on the Rams (but only on their reservations and you have to be there in person; mobile wagering is not included).

Enter the folks at DraftKings, FanDuel, BetMGM and a few more with a measure of their own. Focusing on funneling the taxes generate by wagers to fund homelessness, mental health, and addiction programs in the state. It also proposes large licensing fees, as much as $100m, that would eliminate all but the largest of gambling companies from entering the market.

What’s An Election If There’s Not Some Mud Slinging?

What happened next was a puzzler.

Rather than focus on promoting their measure that‘s on the ballot, the tribes spun a financial 180 and started pumping funds into defeating the other ballot entry. Google, Facebook; anywhere you have information on sports betting in California, you’ll see the ads bashing the gambling companies attempt for control of this billion-dollar opportunity.

Remember, the amount of money the State of California is losing every year that sports betting remains off the table is staggering (around $300 million per year by estimates). It’s already estimated to be in the billions since New Jersey stated taking wagers.

Countries around the world handle this same subject without much effort. This thing was a classic example of reinventing the wheel. England’s been doing it since 1960! It’s not rocket science.

Make it fair for everybody.

If you have a gambling business, you should be able to take sports wagers. Cardrooms, horse racing tracks, tribal casinos, established companies should all have an opportunity. If you have a $1m a year to give the state, shouldn’t that be enough? Make the barriers to entry reasonable for more than just the current market share leaders.

November’s ballot holds the answers to the question on when California will have legal sports betting. Will both measures pass? Is it possible they both get voted down? Is having to drive to a casino for your sports betting pleasures going to be a reality, or will your phone become a legal casino in your pocket? 

There are lots of possibilities. It shouldn’t be that way, but that’s where it’s at! 

Written by Chas Filardi, US sports betting expert and owner of Sports Betting Weekly. Opinions offered here do not necessarily reflect the opinion of VegasInsider.