Fact-Checking the New Yes on Prop 27 Ad in California Sports Betting Battle

A new advertisement that urges approval of California’s Prop 27 makes numerous claims about the impact of the sportsbooks-backed CA sports betting measure. The ad is part of an expensive high-profile marketing war between the supporters of both Prop 27 and Prop 26, the California tribes-backed sports betting measure.

The 30-second ad addresses the tax revenue from legalized online sports betting and how it would affect the issue of homelessness in California, and especially on tribal lands. It stresses Prop 27’s protection against sports betting by minors, and alleges how Prop 26 would not do the same.

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New Advertisement From Yes on Prop 27

The new ad is airing now in California, ahead of the Nov. 8 election.

This ad was produced by Yes on 27, a non-profit organization that lobbies in the California on political issues. It is a collection of organizations, such as All Home, Peoples’ Self-Help Housing, and tribal groups such as Big Valley Rancheria and Middletown Rancheria Pomo Indians of California.

Fact-Checking Statements From Yes on 27 Ad

“Generates hundreds of million every year to permanently fund getting people off the streets”

Under Prop 27, 85% of funds from sports betting tax revenue would be used on homelessness programs. Prop 26 does not have that specific stipulation. With experts stating a mature online California sports betting market could generate $3 billion in annual revenue, it’s not far-fetched to think that could provide hundreds of millions of dollars to homelessness prevention.

Verdict: TRUE

Prop 26: “Not one dime for homelessness”

No, Prop 26 does not stipulate specific tax revenue from sports betting must be used for homelessness programs in California. But, if Prop 26 were passed, 70% of CA retail sports betting revenue tax would go toward the state’s General Fund, which funds homelessness prevention programs, among many other things.


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Prop 27 has “strong protections to prevent minors from betting” while Prop 26 has “no protections for minors”

Under Prop 27, online sports betting would be legal in the world’s fifth-largest economy. If it were to pass, sports betting operators like BetMGM, FanDuel, and DraftKings would be responsible for providing safe and secure systems to prevent those under 21 from wagering. No other jurisdictions in the US have seen serious issues with minors betting via online sportsbooks. That’s why proponents of Prop 27 bring this issue up.

Prop 27 supporters point out that, under Prop 26, sports betting would only be allowed at physical retail locations, where security and identification might be less stringent than an online system. That could be true. However, saying Prop 26 has “no protections for minors” isn’t accurate.


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Prop 27 “helps every tribe, including disadvantaged tribes”

According to this Yes on 27 ad, every tribal nation in California would benefit if Prop 27 passes. Those in favor of Prop 27 point out there is a wide gap between those gaming tribes and non-gaming tribes, even with revenue sharing. Prop 27 would write into law that 15% of tax revenue from online sports betting must go toward non-gaming tribes.

Prop 27 would also help gaming tribes, although not nearly as much as Prop 26. Under Prop 27, sportsbooks would have to partner with a California tribe to offer their California sports betting sites. In addition, gaming tribes could offer their own online sportsbooks. And their license fee would be $10 million, compared to $100 million for private sportsbooks.


Prop 26 does “nothing for disadvantaged tribes”

Yes on 27 is making the argument that Prop 26 keeps the betting hierarchy top-heavy in the state. There will still be a large disparity between gaming tribes and non-gaming tribes under Prop 26, according to supporters of Prop 27.

The Yes on 26 website claims Prop 26 will help non-gaming tribes by providing more funds in the Revenue Sharing Trust Fund, which is currently how gaming revenue is shared among all California tribes. However, under current CA laws, non-gaming and limited-gaming tribes only receive a payment of $1.1 million every year from the RSTF. That would need to change in order for Prop 26’s claim to be entirely true.

But, saying that Prop 26 would do “nothing” for these tribes is not entirely accurate either.


About the Author

Dan Holmes

Dan Holmes is a writer and contributor for California Casinos with plenty of experience under his belt. Dan has written three books about sports and previously worked for the National Baseball Hall of Fame and Major League Baseball. Currently, Dan is residing in Michigan with his family.