Why Gavin Newsome Was No On Prop 27

As more and more states legalize sports betting, voters in California remain cool on sports wagering ballot measures. With two sports betting propositions on the state’s Nov. 8 election ballot, voters made their voices heard on the issue.

Prop 26 would have allowed sports betting at tribal casinos and licensed horse racetracks. It had the support of the California Nations Indian Gaming Association, both major political parties, and an extensive list of civil rights and community organizations.

Prop 27 sought to legalize online sports betting and had the backing of DraftKings, FanDuel, Fanatics, and BetMGM. The three companies sunk millions of dollars into the pro-Prop 27 campaign until about a month before the election as polls showed scant support from state residents.

Golden State citizens, including Governor Gavin Newsom, were hostile to the idea of out-of-state corporations entering California to earn huge profits. Both propositions failed at the ballot box.

Prop 26 – Sports Wagering on Tribal Lands

  • Yes: 1,597,859 (29.9%)
  • No: 3,750,587 (70.1%)

Prop 27 – Online Sports Wagering Outside of Tribal Lands

  • Yes: 898,952 (16.7%)
  • No: 4,495,593 (83.3%)

The measures generated $556 million in fundraising, the most expensive battle of propositions in state history.

The Players In The Latest Fight

Supporters of the opposing propositions waged intense advertising campaigns that heated up over the summer and into the fall. Numerous negative ads with fiery rhetoric blanketed the airwaves, social media, and newspapers.

Financially, opposition to Prop 27 came primarily from the San Manuel Band of Mission Indians who own the largest casino on the West Coast, Yaamava’ Resort & Casino. Anti-27 campaigners made several claims against the mobile sportsbooks bankrolling Prop 27.

“The out-of-state corporations will export money from California and have a track record of questionable operating practices,” No on 27 spokesperson Rob Stutzman said in February.

Native American tribes were also worried that allowing online sportsbooks in the state would threaten tribal sovereignty and reduce the amount of revenue that tribal gaming generates.

Prop 27 Took A Gut Punch From Newsom

In late October, Newsom, a Democrat, came out swinging against Prop 27. Several other prominent politicians in the state joined him including Insurance Commissioner Ricardo Lara, Lieutenant Governor Eleni Kounalakis, and State Treasurer Fiona Ma. All three were up for re-election on Nov. 8 and won their respective races.

For most of the year, Newsom didn’t take sides in the battle although he did make a statement mocking claims by Prop 27 supporters that tax revenue from online sportsbooks would generate money to alleviate homelessness and fund mental health treatment.

“I know initiatives and folks will say anything,” Newsom said during an event for the homeless in Los Angeles in August. “Perhaps that initiative will provide a few dollars. I’m not supporting or opposing it, I haven’t given it a lot of thought, but it is not a homeless initiative. I know Angelenos can read between the lines, and they know better.”

In late October, Newsom was more direct in his opposition to Prop 27.

“Proposition 27 is bad for California. It would hurt California’s Indian Tribes, increase the risks of underage gambling, and push billions of dollars out of California and into the pockets of out-of-state corporations. Vote No on 27.”

With polls that showed scant support for the measure, former California Gambling Control Commission member Richard Schuetz put Newsom’s statement in perspective via Twitter:

“Newsom storms onto the battlefield after the battle and shoots the mortally wounded.”

The Battle Is Not Over

This election year was not the first time, nor will it be the last time sports betting appears on the ballot in California. FanDuel and DraftKings executives made public statements indicating they are already looking ahead to the 2024 election.

However, given the recent results, any proposition will not only need the support of the largest and wealthiest tribes in the state, but it will also need the backing of Newsom, who coasted to another four-year team Tuesday with 58% of votes. His viewpoints on sports betting in the state echoed the concerns of the tribes.

“It’s clear voters don’t want a massive expansion of online sports betting, and they trust Indian tribes when it comes to responsible gaming,” Mark Macaron, tribal chairman of the Pechanga Band of Indians, said. “As tribes, we will analyze these results, and collectively have discussions about what the future of sports wagering might look like in California.”


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