Election 2019

Yes or no on Prop DD: Arguments for and against

Measure asks to legalize, tax sports betting to fund water projects

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As people continue to move to Colorado in droves, one consequence of population growth is often overlooked: the water Coloradans consume.

That’s why Proposition DD this November asks voters to legalize sports betting and allow the state to tax it to send millions of dollars to projects that would manage Colorado’s water supply.

Opponents, though, worry that legalizing sports betting online, in particular, could lead to many Coloradans losing money with the tap of a button on a smartphone.

Here’s a look at how legal sports betting would work, how it could help Colorado’s strained water landscape and what the arguments are on both sides.

What would DD legalize?

By passing DD, voters would allow sports betting of any amount by people 21 or older starting in May, including online, or on mobile sports betting platforms operated by Colorado casinos.

If voters in Black Hawk, Central City or Cripple Creek approve a separate ballot question to legalize sports betting in their cities, casinos could also offer in-person sports betting, according to the 2019 state ballot information booklet, or “blue book.”

Where would the money go?

Under DD, the state could collect up to $29 million per year in sports betting revenue. Colorado would do that through a 10% tax on casinos’ net sports betting proceeds.

The vast majority of the money — $27 million each year — would go toward carrying out Colorado’s Water Plan. Projects under that plan could tackle issues such as water storage and supply, conservation and land use, agriculture, the environment, and recreation. State law outlines those types of projects that can be funded.

The Colorado Water Conservation Board, whose members are appointed by the governor, oversees the implementation of the plan and approves water project grants.

Interstate water compacts and water obligations outlined in federal law could also be funded with Prop DD revenue.

A compact is an agreement between two or more states to establish how the water of an interstate river will be shared between users in different states.

Gambling addiction, casino area impacts

A small portion of Prop DD money each year would go toward gambling addiction services: $130,000 divided up for a crisis hotline, along with prevention and treatment regarding gambling disorders.

A “hold harmless fund” of $1.7 million per year would give revenue to entities that receive tax revenue from traditional gambling and horse racing, such as casino cities and counties, community colleges, and the State Historical Fund. They could apply for funding if they can prove they lost money following the legalization of sports betting.

For or against

Prop DD supporters say water is a scarce resource in Colorado and that demand will keep rising as population grows. Urban cities and agricultural communities alike face challenges if the state can’t meet its water needs, they say.

Supporters also say many Coloradans currently bet on sporting events, but because it’s illegal, they use black-market bookies and websites. Legalizing sports betting would create consumer protections, ensuring that sports bettors receive their winnings and don’t fall victim to fraud or abuse, supporters say.

Opponents say Prop DD puts no limits on the amount a person can bet, enabling people to lose a lot of money with just the touch of a button online. Not enough of the revenue would go toward gambling addiction services to help people who are harmed by the legalization, opponents say.

They also say DD doesn’t provide enough detail on what water projects would be funded and that it doesn’t put up enough money to tackle Colorado’s water needs. Opponents claim some projects may have unintended consequences for the environment and some communities.

Other bits to know

Sports betting operators that contract with a casino would also pay the 10% tax.

Sports betting tax revenue might be lower during the first few years of implementation — the $29 million estimate is based on a “mature” sports betting market, according to the Legislative Council Staff, the state Legislature’s nonpartisan research arm.

An annual average of $16 million in revenue is expected during the first five fiscal years that sports betting is legal, according to the staff’s analysis.

Prop DD restricts the types of bets allowed on college sporting events by prohibiting bets on individual performance statistics or events during the game.

Sports betting would not be allowed on high school sporting events or unsanctioned video game competitions, according to the blue book.

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