Not that you’d know it by the avalanche of television advertising in recent weeks (more on that in a moment), but California has a relatively light slate of statewide measures on the November ballot—only seven this fall versus a dozen in November 2020 and 11 in November 2018.
But that doesn’t mean that Californians have been spared an unhealthy dose of electioneering with Election Day less than six weeks ahead. The principal offenders: the supporters and opponents of Propositions 26 and 27, two ballot measures that aim to change the rules for legalized gambling in California, with two sides raising and spending record sums of money to make their case.
Prior to May 2018 and a Supreme Court ruling striking down the Professional and Amateur Sports Protection Act, a 1992 law barring state-sanctioned sports wagering, Nevada was the only state in America with legalized sports betting; over 30 states now allow some form of legal sports betting, including California-adjacent Arizona and Oregon, but not the Golden State.
So will California jump on the betting bandwagon? Don’t bet on it.
Working backward numerically, let’s start with Proposition 27. If approved, it would amend California law to allow online sports betting over the Internet and via mobile devices. That wagering would apply to both sporting events (though not high school games) and some nonathletic events (awards shows, video game competitions). Elections, on the other hand, would be off limits for betting.
Prop 26, if approved, would permit in-person sports betting at racetracks while otherwise limiting the practice to California-based tribal casinos—at the same time, adding roulette to the tribes’ gaming options (at present, the Golden State’s 76 Indian casinos and five mini-casinos make their money via some 70,000 slot machines and 2,000 table games such as poker and bingo).
One way to explain what’s going on here: a political turf war.
Let me amend that: an outrageously expensive political turf war.
According to data crunched by California’s secretary of state, the money raised both in support of and in opposition to Proposition 27 exceeds $370 million (choose Proposition 27 from the menu on the left of the web page for a list of donors pro and con). That includes 25 contributions in support of the measure totaling nearly $170 million, the most generous being sports-betting giants BetMGM, DraftKings, and FanDuel, each of whom chipped in between $25 million and $35 million (four other gaming entities also made eight-figure contributions).
Simply put, those companies want to strike a different kind of gold in the Golden State—some estimates claim that sports wagering in California is a $3 billion market waiting to happen.
As for the “No on 27” effort (93 donors who anted up over $200 million), its funding comes from (unsurprisingly enough) California tribes already in the gaming business. Thus $78 million in donations from the San Manuel Band of Mission Indians, $30 million from the Federated Indians of Graton Rancheria, $25 million from the Pechanga Band of Indians, $20 million from the Yocha Dehe Wintun Nation, and $10 million from the Rincon Band of Luiseno Mission Indians of the Rincon Reservation California.
Simply put, those tribes want to maintain the status quo of California gambling—one that works to the tribes’ advantage.
The funny thing about this fight over California gambling: if you’d wagered on a fight to the death—i.e., nonstop television ads between now and Election Day—you made the wrong bet. That’s because last week, and with little media fanfare, the Proposition 27 campaign announced that it was scaling back its television buy to running spots in Los Angeles in October and smaller cable outlays in the remainder of the Golden State’s largest media markets, the San Francisco Bay Area, Fresno, Sacramento, and San Diego.
Why such modesty of all a sudden? Most likely, it’s Proposition 27’s brain trust seeing the walls closing in, based on these grim numbers, courtesy of a mid-September Public Policy Institution of California (PPIC) poll, showing the measure receiving an anemic 34% support, with 54% in opposition it. In the Newtonian reality that is California initiatives (what’s up usually goes down, i.e., ballot measures become less popular closer to an election as voters cast a skeptical eye), that 34% figure is pretty much a terminal diagnosis at this point in the campaign cycle.
So how to explain the apparent demise of Proposition 27?
Let’s start with campaign tactics. In this case, Prop 27’s opponents employed a theme that’s often proved effective in California initiative politics: demonizing the opponent (i.e., the betting giants behind the measure) as an evil, out-of-state corporate entity. Add to that: allegations that California, by opening the door to online betting, will encourage gambling addiction among the masses (the “no” campaign offered up children as being especially vulnerable to online gambling via electronic devices).
But one wonders whether Prop 27’s organizers committed an unforced error: overpromising the measure’s beneficial impact on a topic—homelessness—that, for many Californians, embodies underdelivering by the political class.
Read the measure’s details and you’ll see that it requires tribes and gambling companies with sports betting licenses to pay 10% of sports wagers monthly to the state. Payments would go into a new California Online Sports Betting Trust Fund, which will devote 85% of this revenue to homelessness and gambling addiction programs.
In theory, that’s good message in today’s California—the aforementioned PPIC poll reporting that 68% of its respondents believe homelessness “is a big problem in their part of the state” and that 61% say their local presence of homeless individuals has grown in the past year.
But did the Proposition 27 feature modest claims that it was addressing homelessness, a chronic concern in California (and the featured subject of governor Gavin Newsom’s 2020 State of the State address)? Not exactly, as the initiative’s website assures of nothing less than “hundreds of millions of dollars every year for permanent solutions to homelessness, mental health and addiction.” Perhaps such promises—one gaming measure coming to the rescue of the Golden State’s sociological woes—are a leap too far for some homeless-fatigued Californians.
If indeed the California electorate is viewing initiatives through a skeptical lens, then keep an eye on the fate of Proposition 30, which received 55% support on the same PPIC poll that tracked Proposition 27.
Prop 30, if approved by voters, would slap an additional tax of 1.75% on Californians who earn more than $2 million annually, for the next 20 years, with the revenue devoted to increasing funding for zero-emission vehicle programs (money for charging stations and electric-vehicle purchases), plus wildfire response and prevention activities.
But opponents of the measure—most prominently, governor Newsom, who’s featured in this ad condemning Proposition 30 that is presently saturating California’s airwaves—would tell you otherwise: the measure isn’t so much about climate policy, Newsom alleges, as it is one ride-share company (Lyft) looking for taxpayer revenue to help it meet a state mandate to electrify the vehicles of its fleet of gig-economy drivers.
Pity the fence-sitting Californian who doesn’t have the time (or the inclination) to take a deep dive into the state’s weighty Official Voter Information Guide and instead relies on television and streaming services to help form an opinion—all the while more confused by odd political bedfellows (in Proposition’s 30 case, a Democratic governor at odds with big-city Democratic mayors and his state party, siding instead with the California Chamber of Commerce and the conservative Howard Jarvis Taxpayers Foundation, two entities normally at odds with Newsom).
For the better part of the next six weeks, one side of the Proposition 30 debate would have you believe the measure’s approval is vital to addressing climate change and wildfire mitigation. Meanwhile, the opponents contend that, no, it’s a corporate carve out.
Confusing? You bet it is.
