The proposition-happy state of California has a couple of awfully expensive doozies on the November ballot—Prop 26 and Prop 27. Together the two initiatives have racked up $400 million in funding and counting.
Props 26 and 27 both revolve around sports betting at its core. But after that they veer in different directions. But they both promise more tax dollars to fight issues like homelessness, a serious problem in California towns.
In a nutshell, the two propositions pits tribes against online gambling operators. At stake is a cornucopia of riches from sports betting in the largest state in the union, people-wise.
Claremont McKenna College political scientist Jack Pitney said “something for nothing” promises have been used in the past to sell state lotteries as a boundless source for education funding. It’s political salesmanship, “not a cure-all,” he said.
“Both sides stand to really get rich for the long term,” said Democratic consultant Steven Maviglio, who is not involved in the campaign. It could become “a permanent funding source for a handful of companies or a handful of tribes.”
Sportsbooks back Prop 27, which changes state law to allow online sports betting for adults over the internet and on phones or other mobile devices.
Multistate operators would be required to partner with a tribe involved in gambling, or licensed tribes could enter on their own.
The tribes say the proposition would cost them some of their independence. A tax would cover regulatory costs, with the bulk of the remainder earmarked for homeless programs, and a slice going to tribes not involved in online betting.
Most tribes back Prop 26 which requires sports betting to be done in-person at tribal casinos or in the state’s four horse racetracks. A portion of tax revenue would pay for gambling law enforcement and for problem gamblers. What’s more, the proposition would also open the door for roulette and craps at the tribal casinos.
Running the campaigns are such clever-named entities as the Yes on 26, No on 27 committee, sponsored by more than two dozen tribes.
The chief rival represents the Yes on 27 committee. No on 26? Don’t think so.
State analysts acknowledged each proposition could bring in millions. Then again maybe not. And costs would increase for regulation and enforcement. And how many would bet is unknown.
Proposition 26 could lead to another problem that has public workers unions and cities who could see their budgets cut. The proposition includes a little-heralded provision that opponents say could threaten cardrooms around the state.
The proposition makes it more likely to sue cardrooms for violating gambling laws if they feature poker, blackjack and baccarat. This element has gone under the radar. At the center of the growing dispute is who serves as the banker in the card games. In traditional casinos the house serves as banker. Everyone plays against the house.
But historically in California, cardrooms had the banker role rotate around the table.
But in 2007, an outgoing gambling regulator allowed the house to serve as banker if all the patrons declined to take on the role. Tribal casinos said that is a no-no.
The cardrooms say Prop 26 could result in frivolous lawsuits that could put them out of business, threatening jobs and $100 million in annual tax revenue they generated.
Supporters say the cardrooms are overreacting. Kathy Fairbanks, spokeswoman for the “Yes on 26, No on 27” campaign, said tribal sovereignty has stopped this possibility.
Prop 26 is “meant to give tribes standing so they can take this issue to court one time and be done with it,” she said.
But I. Nelson Rose, an emeritus law professor at Whittier College who specializes in gambling law, said the provision in the ballot measure is designed “to drive cardrooms into bankruptcy, for no reason other than they hate the clubs.”
Rose says the tribes are going after the clubs partly because they are in better locations than most tribal casinos, cities Becky Warren, spokeswoman for the “No on 26” campaign, says the lawsuit provision is an attempt to shut down cardrooms.
“They still have this belief that they should have exclusivity on games, even though no one else agrees with it,” she said.
Faced with two similar questions, voters may just vote no and be done with it. “When in doubt, people vote no,” Pitney said.
