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What’s the difference between Prop 26 and Prop 27?

If you feel like you’ve been bombarded with advertisments for sports betting legislation over the past several months, you’re not alone. According to California Casinos, there has been more than $411 million spent on advertisements between the two groups battling for the rights to the state’s betting market. This makes the sports betting initiative the most expensive ballot fight in California history.

What’s the difference between Prop 26 and Prop 27? Will either one pass and bring legalized sports betting to California? Here’s what you need to know.

What is Prop 26?

Prop 26 would legalize in-person betting at the state’s tribal casinos as well as California’s four horse racing tracks in Arcadia, Los Alamitos, Albany, and Del Mar. This would allow adults 21 years and older to visit a retail sportsbook and place wagers on professional sports only, as betting on college sports would still be outlawed.

Roulette and craps, which are currently illegal in California, would also be permitted as part of Prop 26. Currently, only slot machines and percentage card games are allowed by state law.

A 10% tax would be levied on sports betting profits and the majority of those funds (70%) would go toward the state’s General Fund. The remaining 30% would be split between problem gambling and mental health programs and gambling enforcement and control.

What is Prop 27?

Prop 27 looks to legalize online sports betting and is backed by private industry giants like FanDuel and DraftKings. Sports betting apps would allow Californians to place wagers from anywhere within state lines.

 

Up until recently, the majority of the advertising money spent by Prop 27 backers has been focused on how the initiative would help solve the homelessness crisis in California. Under Prop 27, 85% of the tax revenue created from mobile sportsbooks would go toward the California Solutions to Homelessness and Mental Health Support Account program. Non-participating tribes would receive the remaining 15%. This would also be as a result of a 10% tax on sportsbook operators profit. There would also be a one-time $100 million application fee and a $10 million renewal fee paid every five years.

 

A recent poll has shown that Prop 27 is fighting an uphill battle, however, and California residents won’t be seeing ads in favor of of the mobile ballot initiative on their televisions going forward. Instead, voters can expect to find direct mail pieces as well as digital ads.

 

Will Sports Betting Be Legalized in California in 2022?

The poll mentioned above had been conducted by the Public Policy Institute of California which asked over 1,000 people identified as “likely voters” specifically about Prop 27. Here are some of the key findings:

  • 34% of respondents planned to vote yes on Prop 27 while 54% were against the ballot initiative.
  • Only 29% claimed the outcome of Prop 27 to be ‘very important.’
  • Looking at it from party affiliation, the most support came from Independents at 40%, followed by Democrats at 34% and Republicans at 29%.
  • 52% of voters aged 18-44 said they planned to vote yes on Prop 27.

Speaking of political parties, the California Republican Party has voted to oppose both sports betting ballot initiatives. The California Democrat Party has remained neutral on Prop 26 and opposed to Prop 27.

 

For those who wanted the convenience of mobile sports betting but would be willing to settle for making the trip to visit a retail sportsbook, those chances are somehow more grim. Earlier research on Prop 26 found that there was even less support for the tribal-led initiative. How can that be? The majority of money spent by those backing Prop 26 went towards anti-Prop 27 ads. 

 

California voters weren’t even sure what Prop 26 was trying to accomplish because it seems tribes were more focused on ensuring Prop 27 failed versus garnering support for Prop 26.

In addition to California’s tribes missing out on a wealth of sports betting revenue, there is fear that the passing of Prop 27 would eventually lead to mobile casino games being legalized as well. Doing so would be a massive blow to the amount of money tribal communities bring in.

 

Unless we see a dramatic shift in favor of Prop 27, it seems as though California sports fans will have to hope some sort of compromise can be made between the two opposing groups and different legislation put forward. Sportsbook operators wouldn’t be the only ones missing out if California continues without legalized sports betting. 

 

Eilers & Krejcik Gaming recently released a report estimating the potential for California to see $3.1 billion in sports betting revenue if the state offered both retail and mobile sports betting. While the opposing initiatives allocated tax revenue differently, that’s still money missing to go toward programs to assist California residents one way or another.

 

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