Colorado Sports Betting Faces Crackdown as Senate Approves New Restrictions
Colorado sports betting now faces the state’s most significant regulatory crackdown since voters approved legalization in 2019. The Senate has passed a bill introducing new restrictions on an industry that has experienced explosive growth, with wagers surging from $1 billion to more than $6 billion in just a few years. While Colorado sports betting has generated substantial revenue, concerns about problem gambling have mounted. Specifically, calls to the state’s gambling addiction hotline have jumped nearly 50% since legalization. The legislation represents lawmakers’ attempt to balance the industry’s economic benefits, which generate roughly $30 million annually in tax revenue for state water projects, against rising concerns about gambling-related harm.
Senate Approves Bill Targeting Problem Gambling in Colorado Sports Betting
Lawmakers in the Colorado Senate gave final approval Tuesday to Senate Bill 131, a bipartisan measure that introduces strict consumer protections for Colorado sports betting operations. The legislation, sponsored by Sen. Matt Ball, a Democrat from Denver, and Sen. Byron Pelton, a Republican from Sterling, prohibits internet sports betting operators from accepting more than five separate deposits from an individual within a 24-hour period.
The bill bans credit card usage for sports betting transactions, a restriction designed to prevent wagering with borrowed funds. Operators face additional prohibitions on initiating mobile device push notifications or text messages to account holders soliciting bets or deposits.
Advertising restrictions represent another major component. Sports betting promotions cannot include terms such as “bonus bet” or “no sweat,” and advertisements are barred from broadcasting between 8 a.m. and 10 p.m. or during live broadcasts of athletic competitions. The legislation also prohibits operators from limiting deposit sizes or frequency when individuals receive financial benefits from placing bets, unless activities indicate suspicious behavior or gambling disorder.
The Colorado Gaming Control Commission gains authority to assess penalties up to $25,000 against violators[10]. Before final passage, lawmakers removed a proposed ban on proposition bets through an amendment approved by a 5-2 vote.
Lawmakers Split on Final Vote Despite Bipartisan Sponsorship
Despite bipartisan sponsorship, the final vote revealed deep divisions within both parties. Pelton and Sen. Janice Rich of Grand Junction were the only Republicans to vote in favor of SB-131’s final Senate passage Tuesday. Three Democrats split from their party, with Sens. Dylan Roberts of Eagle, Nick Hinrichsen of Pueblo and Tom Sullivan of Aurora casting votes against the bill.
Pelton defended the measure, citing widespread impact across the state. “Across rural and urban Colorado, families are seeing the very real harm that unchecked online sports betting can cause,” he stated.
The legislation faces significant industry pushback. Online betting platforms DraftKings, FanDuel, BetMGM and Bet365 are all lobbying in opposition to SB-131, according to state records. The Sports Betting Alliance, representing industry interests, has joined the effort against the restrictions.
The opposition from major Colorado sports betting operators signals potential challenges ahead. These companies have invested heavily in the state’s market since legalization, and the new restrictions threaten their business models. The deposit limits, advertising bans, and credit card prohibitions represent substantial operational changes that could affect their revenue streams and customer acquisition strategies.
Bill Undergoes Key Changes to Reduce Revenue Impact
A last-minute amendment substantially altered SB-131’s financial trajectory. The Senate Appropriations Committee voted 5-2 on April 21 to strip the proposition bet ban from the legislation. This change reduced the projected state revenue decrease from approximately $2.4 million to $800,000 for the 2026-27 budget year.
Ball accepted the amendment, introduced by Sen. Chris Kolker, to preserve the bill’s remaining consumer protections. He acknowledged the gambling industry’s influence on the decision. “The gambling industry has a lot of money, and we’re drastically outspent, and that definitely has an impact on bills, this one included,” Ball stated.
Fiscal concerns drove the revision, particularly in a tight budget year. The original prop bet ban would have cost the state $2.6 million in revenue, primarily affecting water project funding. Proposition bets allow wagers on individual game elements, such as player performance or real-time scoring. The NCAA called for eliminating these wagers in January, citing risks to game integrity.
State fiscal analysts had estimated that 25 percent of Colorado sports betting involves proposition bets. The committee ultimately passed the amended SB-131 by a 4-3 vote. Ball noted the credit card restriction would primarily affect gamblers who rely on credit owing to problem gambling.
