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Proposition 27

October 10, 2022

Proposition 27 would legalize online sports betting through certified tribes and large online betting platforms.

California state law currently limits some types of gambling. Proposition 27 would allow Californians to engage in online sports betting through certified tribes and large online betting companies. 

Prop. 27 would require those offering online sports betting to pay 10 percent of the bets into a new fund that will go first toward paying for regulatory costs, then toward homelessness and gambling addiction programs. Analysis from the Legislative Analyst’s Office estimates that potential revenues from Prop. 27 will likely not exceed $500 million and will likely go mostly toward offsetting regulatory costs. This also means that, conversely, those offering online betting would retain 90 percent of the profits, which are estimated to be about $4.5 billion.

A YES vote on Proposition 27 means: If approved by voters, Proposition 27 would allow for online sports betting offered by licensed tribes or gambling companies, with a share of the bets paid to the state.

A NO vote on Proposition 27 means: If Proposition 27 fails, no changes would be made to the enforcement of current state gambling and betting laws.

Top funders of Proposition 27:

  • Yes on Prop 27: The top funders of the ballot measure committee supporting Proposition 27 are online betting companies FanDuel, DraftKings, and Penn Interactive Ventures, all three of which are based on the east coast of the U.S. Although the Yes on 27 committee has not reported raising funds this year so far, the committee received $100 million in 2021. As of August 1, the Yes on 27 committee has spent $23 million. 
  • No on Prop 27: The top funders of the main ballot measure committee opposing Proposition 27 are the San Manuel Band of Mission Indians, Rincon Band of Luiseño Indians, and Pala Casino Spa Resort. On August 1, the committee reported having raised $41 million and spent $32 million since Jan. 1, 2022. There is also a ballot measure committee that is simultaneously supporting Prop. 26 and opposing Prop. 27, which is funded primarily by the Federated Indians of Graton Rancheria, the Pechanga Band of Indians, and the Yocha Dehe Wintun Nation. As of August 1, the Yes on 26, No on 27 ballot measure committee has raised $60 million and spent $31 million since Jan. 1, 2022.
  • Additionally, both the California Democratic Party and the California Republican Party oppose Prop. 27.
  • So far, the ballot measure committees involved in the Props. 26 and 27 contests have in total raised $218 million and spent $65 million, making the two measures among of the most expensive ballot measure contests on record.

Misinformation about Proposition 27 includes:

  • The proponents of Prop. 27 claim it will provide “hundreds of millions of dollars every year to fund mental health treatment and solutions to homelessness and addiction.” However, state analysis of the measure’s potential effects estimates that it may produce up to $500 million in revenue, and that revenue is first dedicated to covering regulatory and enforcement costs.
  • The proponents of Prop. 27 describe their coalition of supporters as primarily including “housing and mental health experts, tribes, and citizens.” Two tribes are currently listed as supporters of Prop. 27: Big Valley Rancheria Band of Pomo Indians and the Middletown Rancheria of Pomo Indians. For comparison purposes, the list of Prop. 26 supporters includes thirty-one tribes and tribal organizations.

Proposition 27 and Proposition 26:

  • Prop. 26 focuses on in-person betting, while Prop. 27 focuses on online betting. If both Props. 26 and 27 pass, they will likely both go into effect, as neither ballot measure technically conflicts with the other. The authors of Prop. 27 explicitly wrote into the measure that “Proposition 27 does not conflict with Proposition 26,” but whether the courts will find that both measures can operate simultaneously remains to be seen. If the courts find that they don’t conflict, the two measures will both take full effect. If the courts find that the two measures do conflict with each other, whichever measure receives the most votes in the election will be the one that goes into effect. Opponents of each measure may leverage the issue of potential conflict and voter support in court to defeat one of the measures post-election, should they both be approved by voters.