Legalization of Sports Betting in California
Ads for Propositions 27 and 26 were unmissable on television this summer. Why are there two sports gambling initiatives on the ballot in November? In California, all forms of sports betting, except for horse racing, are currently prohibited. This contrasts with many states that already regulate sports betting like Pennsylvania, the market of which is filled with popular brands like Caesars, Bet Rivers, and betPARX.
The two initiatives will effectively pose the same issue to California voters: Should sports betting be legalized? Simply put, Prop. 27 would legalize sports betting online everywhere, but Prop. 26 would permit betting in-person at four horse racing establishments and Native American tribal casinos.
Native American tribes support Prop 26, while online gaming businesses support Prop 27. A coalition of tribes invested over $30 million to pass Proposition 26, which would legalize live sports betting at reserve casinos and racetracks. A proposal (Prop 27) that would permit Californians to place bets through their computers and mobile applications is being funded by a consortium of online sportsbooks, including FanDuel and Draftkings, as well as Las Vegas casinos.
Proposal 26
Prop 26 allows racetracks to accept bets from customers who are at least 21 years old. At the racecourse, all bets must be placed in person. Additionally, the proposition mandates that racetracks provide the state with 10% of daily sports bets placed. An entirely new California Sports Wagering Fund would receive these payments. Proposition 26 amends the California Constitution to permit roulette and dice games in tribal casinos, in addition, to live sports betting.
An estimate by state authorities found that Proposition 26 would bring in tens of millions of dollars yearly in state revenues. In order to determine the annual minimum amount to be spent on K–12 schools and community colleges, CSWF income must be included in state tax receipts. This indicates that funds from the CSWF would be initially utilized to contribute to this necessary level of education investment.
The proposal stipulates that money from the fund must thereafter be utilized to cover state regulatory expenses. The remaining funds would be allocated to gambling addiction, mental health, and law enforcement initiatives, as well as the state’s general revenue.
Proposal 27
Prop 27 would let tribes provide mobile and online sports betting for people 21 and older, as well as casino corporations that partner with tribes. Major gambling businesses like DraftKings will be the first to sign a contract with one of California’s 79 tribes.
The proposal would make various non-athletic activities, as well as select sporting events (like NFL football games), eligible for online betting (such as video game competitions). However, it forbids bets on some events, such as high school sporting matches.
Tribes and gambling businesses would both be obligated to pay taxes to California for any online bets. According to a governmental analysis, annual taxes and levies would amount to hundreds of millions of dollars. The funds would be used to support initiatives to combat homelessness and gambling addictions, as well as Native American tribes that abstain from the practice.
What is the Position of Governor Newsom?
The governor of California, Gavin Newsom has a neutral stance on both Propositions 26 and 27. He did, however, clarify to reporters at a Los Angeles event that Prop 27 is not intended to combat homelessness.
Newsom stated that he is aware that people and initiatives would say anything. Perhaps some funds will come from that project. It is not a homeless project, but he is neither in favor of it nor against it, nor has he given it any consideration. He is aware that Angelenos are intelligent and can see through lies.
