A statewide ballot question in Colorado that paves the way for legal sports betting both in a casino retail setting and via online/mobile sportsbooks appears to have passed.
Proposition DD was too close to call in the early morning hours on Wednesday, but after additional vote counting the measure looks to be successful. Colorado should have legal sports betting.
With 58 of 64 counties reporting as of 9 a.m. EST on Wednesday, Proposition DD had 684,739 votes, finally pulling significantly ahead of the 671,598 “no” votes. Roughly one-third Colorado’s registered voters turned out to weigh in on the issue, a relatively lackluster turnout for an important policy question.
Most of the tax money from betting will go to the state’s water fund, which will benefit the agricultural industry.
According to Ballotpedia, about $2.7 mm was spent to try to sway Coloradans to vote for Proposition DD. FanDuel spent $1.35 mm, while DraftKings contributed $500k.
Zero dollars were spent to oppose the measure, according to Ballotpedia.
The measure was opposed by faith-based groups and many environmentalists. According to the Colorado Sun, Proposition DD divided the community of environmentalists in the state.
Timeline for Colorado sports wagering
In May, the Colorado Legislature sent the sports betting bill to the governor.
Gov. Jared Polis signed HB 1327 on May 29.
The legislation allows sports betting to commence in May 2020, both in-person at casinos in the state’s three gaming towns (Black Hawk, Central City, and Cripple Creek) and online through internet sports betting operators contracted by licensed casinos. Coloradans may have legal betting options available in time for NBA playoff action and the MLB season.
The licensing fee for all master licensees and sports betting operators is $125k per license. The state is anticipating 40 license applications right out of the gate, per a fiscal note.
The reason for the six-month delay in implementation is due in large part to the time required to create a new department in the state’s Division of Gaming and craft regulations. Colorado officials will be busy over the next six months working to implement the new law.
Colorado will subject companies to a 10% tax rate on net sports betting proceeds, a relatively industry-friendly rate compared to other states that have legalized sports wagering since PASPA fell in May 2018.
The state’s sports betting law does not give the sports league an “official league data” mandate. The law does prohibit prop bets on all college sports.
A 2017 study from Oxford Economics projected Colorado to eventually see $4.9 billion in annual sports betting handle under a 10% tax rate. It will take some time to see if Colorado’s legal market can get there.