Proposition 27: Allow online and mobile sports wagering outside tribal lands
Proposition 27 would allow tribes and larger licensed gambling companies to offer sports betting online and require them to make payments to the state, including a cut of 10 percent of sports bets made and hundreds of millions of dollars for initial licensing.
The proposition could create hundreds of millions of dollars in revenue for California, according to LAO. Of this revenue, 85 percent of the money would go toward homelessness and gambling addiction programs. The other 15 percent would be allocated to tribes that are not involved in online sports betting.
Proposition 27 also creates a 15 percent penalty paid to the state for placing online sports bets with unlicensed entities and restricts unlicensed entities.
Proponents tout the fiscal benefits of the proposition and the money it will create for homelessness. They argue that its fines will protect against underage gambling. The primary backers are online gaming companies like DraftKings, FanDuel, and BetMGM, which stand to benefit immensely from the proposition.
The proposition has been criticized for creating barriers for smaller online gaming companies to compete in California through its $100 million licensing fee and requirements to already be licensed in 10 states or be in five states already and operating 12 casinos.
“If you look at it, like it’s entirely funded by these huge online sports betting apps, and it’s like, obviously, they’re trying to benefit from it,” Hunt said.
Opponents argue that Proposition 27 will make gambling too accessible and escalate underage gambling and addiction, and that the money would go to out-of-state companies. Both California’s Democratic and Republican parties oppose it.
Confusingly, some tribes and homelessness organizations are for and against the proposition. While tribes without casinos gain free money from it, those with casinos may lose business to the competition from online sports betting, according to standwithcatribes.com.