Colorado Removes Prop Bet Ban from Sports Betting Reform Bill
Colorado legislators have moved forward with a gambling overhaul, though the measure has been pared back after negotiators dropped a push to eliminate prop bets.
Senate Bill 131 originally took aim at Colorado sports betting wagers tied to individual athlete statistics, a market that has drawn scrutiny from player unions and mental health advocates alike. But fiscal pressure during committee review forced a quieter resolution.
The final package keeps the bulk of the existing betting framework intact, grafting on a set of tighter consumer safeguards.
The decision followed warnings from Colorado sportsbooks that eliminating prop bets could significantly reduce tax revenue. Colorado directs a large share of sports-betting taxes toward water projects, and lawmakers have raised concerns that any shortfall would shift funding pressure onto the state's general fund.
The amendment reduced the projected revenue loss from $2.4 million to about $800,000 in the first fiscal year.
Prop bets remain a core part of the sports betting ecosystem, often bundled into multi-leg wagers that require several outcomes to succeed. Some operators have specific Colorado sportsbook promos that involve props.
Despite the ban being lifted, the legislation still provides a number of regulations for them. It would prohibit the use of credit cards for betting, limit daily deposits to five transactions, and restrict certain push notifications designed to prompt wagering. Advertising limits are also included, though broadcasters continue to oppose those provisions.
State officials also plan to spend about $1.25 million over two fiscal years to collect and analyze sportsbook data, addressing a lack of detailed research on gambling behavior at the state level. Existing studies suggest broader financial risks tied to legalized sports betting, including higher bankruptcy rates and loan defaults, but state-specific data remains limited.
Ohio considers broader sports betting changes
As Colorado moderates its approach, Ohio sports betting lawmakers are pursuing more expansive changes to sports betting policy. Proposed legislation would impose a 2% fee on all wagers, adding to the state's existing 20% tax on sportsbook revenue.
Sen. Bill Blessing's S.B. 199 aims to generate funding for public stadium projects and K-12 education. The proposal builds on earlier efforts tied to financing plans for the Cleveland Browns stadium and broader state budget discussions. Blessing estimated the wagering fee could produce about $200 million annually.
Combined with other tax measures under consideration, including higher tobacco taxes, a new excise tax on kratom, and an increase in marijuana taxes to 15%, lawmakers projected total additional revenue of up to $1.5 billion per year.
A separate proposal from Reps. Riordan McClain, Gary Click, and Johnathan Newman target stricter consumer protections. These measures would limit or potentially eliminate online betting, restrict wager amounts, ban credit card use, and tighten advertising rules.
Advocates of the measure argue that gambling carries the same risks as substance addiction and may cause harm to one’s family budget and sporting competitions. The bill is incomplete at the moment. It will later be followed by bills protecting consumers’ rights and addressing sporting integrity.
