Almost three months remain until the election on November 8, but gambling factions already have broken California’s record for campaign spending on ballot initiatives and are expected to reach a final total surpassing half a billion dollars.
Gaming tribes and a consortium of commercial sports-betting operators have spent more than $350m for and against two measures to legalize wagering.
The previous spending record of $222m was set in 2020 when voters approved Proposition 22, a proposal allowing Uber and Lyft to classify their drivers as independent contractors rather than employees entitled to benefits.
Proposition 22 was eventually found invalid under the California constitution by a state court judge. The ruling is still under appeal.
Proposition 26 would allow in-person sports betting at California’s 62 tribal casinos and four racetracks.
Proposition 27 would allow online sports betting managed by companies such as DraftKings and FanDuel.
But it is not just a fight between California’s gaming tribes seeking to protect their monopoly and commercial sports-betting entities determined to enter the nation’s most coveted market of almost 40m people.
California’s horseracing industry appears to be aligned with the tribal retail sports-betting initiative, while the Golden State’s 66 cardrooms are vigorously opposed to the same measure.
“Prop 26 strikes a reasonable balance between legalizing sports wagering for California consumers, while at the same time preventing the proliferation of mobile and online gambling that some critics see as harmful,” said Scott Daruty, president of Monarch Content Management, which is affiliated with the Stronach Group, North America’s largest conglomerate of racetracks.
On the other hand, Daruty said Proposition 27 is not just bad for California racing but bad for California.
“Under the pretext of helping solve the homeless crisis in California, out-of-state gambling conglomerates have written a law that allows them to dominate the California marketplace and send 90 percent of the profits from California sports wagering to out-of-state companies,” Daruty said.
Bob Liewald, chairman of the Thoroughbred Owners of California, said his organization endorses the tribal sports-betting initiative but remains neutral on the online sports-betting measure.
“The board and our constituents are split on the value sports wagering will bring or take away from racing,” Liewald said.
“We have a relatively small voice compared to tribes and the FanDuels of the world, but we will continue to express our support for [Proposition] 26 right up to Election Day and encourage our members to vote their choice on [Proposition] 27.”
California’s cardrooms are portraying the sports-betting election as a fight for survival against California’s gaming tribes.
A provision in Proposition 26 would empower tribes to sue cardrooms for violating California rules and regulations before state law enforcement officers take action.
“It would essentially result in death by a thousand cuts for cardrooms and so if it would do that to cardrooms, it would do that to our cities by extension — our cities that rely on cardrooms for the provision of services to our residents,” Juan Garza, executive director of California Cities for Self Reliance Joint Power Authority which represents cardrooms, told KNSD TV in San Diego.
Like the Thoroughbred Owners of California, the cardrooms remain neutral on Proposition 27.
Meanwhile, other organizations, including animal rights advocates, are entering the sports-betting fray in California.
“Horseracing amounts to animal cruelty and exploitation,” said Dr. Jennifer Scarlett, CEO of the Society for the Prevention of Cruelty to Animals in San Francisco.
“It is a dying industry that should not be given millions of dollars in aid through in-person sports wagering.”