California Sports Betting: Endorsements Roll Out Against Proposition 26

Both of the state's prospective legal sports betting legislature bills seemed destined to fail at the November 8 ballot, with momentum against both Props 26 and 27 continuing to surface.

Last Updated: Oct 24, 2022 3:27 PM ET Read Time: 3 min
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While the major sportsbooks may have basically abandoned almost all hope for passage of Proposition 27, their bill to legalize online sports betting in California, card room operators want to make sure that the rival tribal Proposition 26 also goes down to defeat when voters go to the polls on November 8.

On Friday, the No on 26 campaign, largely sponsored by California's card room owners, issued a statement announcing that "every major California newspaper" is opposed to the legislation sponsored by a broad coalition of native tribes.

The release contained excerpts of editorials from the following major news outlets:

Plus a handful of other newspapers from across California that have asked voters to reject Proposition 26, which would allow in-person legal sports betting at tribal casinos and racetracks.

The bill is backed by a coalition of 51 native tribes seeking to retain their long history of control over gaming in the state, which saw more than $200 million in TV ads attacking the rival sportsbook legislation.

Of course, many of these same newspapers have also been advising their readers, in even more stringent terms, to vote no on the online sportsbook-backed Prop 27 — the No on 27 announcement is merely the latest in what has been a long summer of dueling attack ads... which resulted in alienating California voters altogether.

California voters turned off by ads on both sides

The total ad spend for and against Props 26 and 27 has topped $500 million — a new record with respect to state legislative measures in the U.S. The money was largely wasted, however, as Californians were put off by the saturation of TV campaigns where sportsbooks and native tribes were endlessly attacking each others' credibility.

The bitter legislative campaign has seen the sportsbooks missing the mark by labeling Prop 27 as a "Homeless and Mental Health Solutions" bill — owing to funds that would be allocated to such initiatives from the 10% tax on operators' earnings — but voters may well have felt insulted by a misleading advertising campaign that failed to mention the primary intent of Prop 27 — to legalize online sports wagering.

That was certainly the interpretation put forward by many members of the No camp. Kendra Lewis, Executive Director of the Sacramento Housing Alliance, criticized operators' motives in support of the No on 27 campaign.

"Prop 27 is a fundamentally flawed measure that will make the homeless crisis worse in California," said Lewis. "The fact that Prop 27’s backers are using this very real humanitarian crisis to sell their deceptive online gambling measure is shameful."

A poll conducted by the L.A. Times and UC-Berkeley earlier this month revealed that voters who reported seeing the dueling attack ads about Props 26 and 27 indicated they were far more inclined to reject both bills, compared to those who avoided seeing any of the TV spots.

"I think it’s the negative advertisements that have kind of been turning voters away," said Mark DiCamillo, the director of the UC-Berkeley Institute of Governmental Studies (IGS) poll. "People who haven’t seen the ads are about evenly divided, but people who’ve seen a lot of ads are against it. So, the advertising is not helping."

Polls confirm voter dissatisfaction

The LA Times/UC-Berkley poll was one of two major surveys that indicated the general public's animus towards the sportsbook-sponsored bill.

In addition to that poll surmising that likely voters were overwhelmingly opposed to the sportsbook-sponsored legislature by a 53% to 27% margin, the October 4 survey also revealed that Proposition 26 only had 31% of likely voter favor.

The UC-Berkeley poll confirmed the findings of a September 15 poll conducted by the Public Policy Institute of California that had likely voters rejecting the sportsbooks' bill by an equally decisive margin (the poll did not voter opinion on Prop 26).

More recently, a SurveyUSA poll released in the second week of October gave a smattering of hope to native tribes by showing that the support for Prop 26 had improved — albeit the survey carried a much smaller sample size than the PPIC and UC-Berkeley polls.

Tribes attracted broad coalition of groups, sportsbooks left on their own

From the very beginning, the native tribes were determined to play on long-standing public sympathy for their traditional control of retail casinos and horse tracks, where legal gaming could take place.

Over the course of the summer, the No on 27 campaign saw 51 native tribes find allies in the California State Association of Counties (CSAC), which represents all 58 counties in the state, the California League of Cities, both state Democratic and Republican parties and their top legislative leaders, as well as the major teachers’ unions.

Even organizations geared towards helping the homeless — Step Up, Goodwill Southerm California, and the San Bernadino Corps of The Salvation Army — joined the No campaign even though they would have ostensibly benefited from the sportsbooks' self-imposed revenue tax.

For the most part, it was the major sportsbooks (headlined by FanDuel, DraftKings, and BetMGM) that were left twisting in the wind from a general lack of support — only three native tribes in the state were willing to back Prop 27.

Major League Baseball announced it was backing Prop 27 in August, tossing the sportsbooks a lifeline... and recognizing the promotional benefit to the five pro baseball franchises operating in California.

But that was essentially the extent of operator support, apart from a few isolated homeless shelter groups and the mayors of the towns of Oakland, Sacramento, Fresno, and Long Beach.

Most tellingly, California's major homeless shelter operators were never on board with the sportsbooks' "homeless solutions" messaging. In a September 22 statement issued by the "No on 27" committee, grave doubts were cast on the sportsbooks' bona fides regarding homelessness.

"I don’t think there’s anybody in homeless services that actually thinks that we would realize a windfall from this, that we can instantly start building housing units and getting people off the street and getting them into mental health service," said Fran Butler-Cohen, CEO of Family Health Centers of San Diego, a foundation that serves 27,000 homeless people each year. "I don’t think anybody thinks that."

Added Paul Boden, executive director of homeless advocacy group Western Regional Advocacy Project: "If these corporations wanted to be helping homeless people and mentally ill people, they could use their foundations, which they all frickin’ have."

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