In a recent decision, Colorado legislators have opted to remove a proposed prohibition on proposition bets from a broader sports betting reform initiative. This change comes in response to concerns regarding the potential financial impact and the reaction from the industry.
The amendment, which received approval on Tuesday, discards a clause that would have limited bets on specific in-game occurrences, often referred to as prop bets, while maintaining other regulatory aspects of Senate Bill 131.
Lawmakers were influenced by forecasts indicating that banning prop bets could lead to a substantial decline in state revenue associated with sports betting activities. Initial estimates suggested that the state could lose between $2.4 million and $2.6 million in the first fiscal year, primarily affecting funding for water projects.
With the removal of this provision, the anticipated fiscal impact is now expected to decrease to approximately $800,000.
The Colorado Division of Gaming has reported that sports betting activity in the state surpassed $6.5 billion in total wagers in 2025, highlighting the market's significant scale.
Senator Matt Ball, a key supporter of the bill, stated that this modification was crucial to minimize financial risks and to uphold the broader framework of the legislation. He acknowledged the influence of external pressures during the legislative process, remarking to Axios Denver that, "The gambling industry has a lot of money, and we're drastically outspent, which definitely affects bills, including this one."
Operators had warned that eliminating prop bets could hinder user acquisition and retention due to their popularity, especially in parlay bets.
Additionally, lawmakers recognized that restricting these bets might drive players to offshore platforms that continue to offer such options without the same consumer protections.
Proposition bets allow wagering on specific aspects of a game, such as individual player performance or particular outcomes during live play. These bets are typically placed quickly, leading to increased engagement.
Although the restriction on prop bets has been lifted, Senate Bill 131 still includes provisions to tackle gambling-related risks, including a ban on using credit cards for sports betting transactions.
Lawmakers believe this measure will account for the remaining projected revenue decrease of $800,000. The aim is to restrict betting with borrowed funds and standardize practices, as many operators in Colorado already do not accept credit cards.
Research presented during legislative discussions has associated micro-betting formats, like prop bets, with compulsive gambling tendencies. Concerns about potential athlete manipulation have also been raised, leading the National Collegiate Athletic Association to advocate for the elimination of such wagers in January.
Despite these concerns, Ball chose to remove the ban with minimal debate to protect other components of the bill, including limits on promotional bonuses.
Attention now shifts to how the remaining provisions will develop as the bill progresses. Lawmakers and industry stakeholders are anticipated to continue discussions, particularly regarding advertising restrictions and other consumer protection initiatives as the legislation advances.