Efforts to ban prop bets in Colorado have been rejected. On Tuesday, legislators voted to remove a proposed ban on prop bets from Senate Bill 131, which is a broader measure aimed at reforming sports gambling regulations.
Prop bets have become extremely popular in sports betting. Players often combine them into parlays for larger payouts. Given their popularity, industry operators warned that eliminating these wagers could significantly reduce state tax revenue.
That concern carried added weight as Colorado faces budget constraints. A share of sports betting taxes is slated for state-approved water projects, raising concerns that any shortfall could shift costs to the general fund.
Sen. Matt Ball, a lead sponsor of the bill, said removing the prop bet ban through an amendment would substantially reduce the projected fiscal impact. It would go from an estimated $2.4 million loss in sports betting revenue to about $800,000 in the first fiscal year.
As such, it left them with no choice but to move this provision from Senate Bill 131.
In addition to budget constraints and loss in revenue, banning prop bets would make Colorado an unappealing market for operators. Since props are so popular, sportsbooks would have less success getting users to sign up there if they are unavailable.
The absence of prop bets would potentially push Colorado players to offshore platforms, which still offer these wagers. That would put them at risk because these offshore sites don’t have the same consumer safeguards in place.
To that end, removing prop bets as part of this sports betting reform was an important change made by Colorado lawmakers.
The remaining estimated $800,000 revenue decrease is tied to a provision in Senate Billm 131 that would ban the use of credit cards for sports betting. This measure is aimed at reducing risky behavior, particularly among individuals who may be wagering money they do not have access to.
Sen. Ball indicated the financial impact of the restriction is expected to be relatively limited, noting it primarily affects a smaller segment of users. While many sportsbooks in Colorado already do not accept credit cards, the legislation would standardize the rule across all operators.
Backers of the bill frame the restriction as a key responsible gaming safeguard, designed to encourage bettors to use available funds rather than borrowed money. This can potentially help reduce problem gambling.
