California Democrats vote to oppose online sports wagering

The Democrats, the predominant political party in California, also agreed to remain neutral on Proposition 26, an in-person, tribal-only wagering initiative backed by a coalition of the state’s tribes.

The Democrats’ executive committee sealed the decision, along with recommendations to support six other propositions, including ones dealing with reproductive freedom, raising the minimum wage, and raising taxes on residents who earn $2 million or more to fund a reduction in greenhouse gas emissions. Propositions 26 and 27 were the only two the Democrats chose not to support. The California Young Democrats followed suit, opposing Proposition 27 and remaining neutral on Proposition 26.

Swift reaction from ‘No on 27’ groups

The two most vocal “No on Prop 27” groups immediately sent out press releases praising the Democrats’ stance.

“By opposing Prop 27, California Democrats rejected out-of-state corporations and reaffirmed their commitment to California’s Indian tribes,” Reid Milanovich, tribal chairman of the Agua Caliente Band of Cahuilla Indians, said via press release sent out by the Coalition for Safe, Responsible Gaming. “Prop 27 is not a solution to anything. It would expose children to a massive expansion of gambling and turn every cellphone, gaming console, tablet, and laptop into a gambling device. Prop 27 is a direct attack on tribal gaming and Indian self-reliance.” The coalition is lobbying voters to vote no on Proposition 27 and yes on Proposition 26. It is backed by myriad tribes, including the Barona Band of Mission Indians, the Pechanga Band of Luiseno Indians, and the Yocha Dehe Wintun Nation. A second opposition group, Protect Tribal Sovereignty and Safe Gaming, also responded.

“There is no question that Proposition 27 is an assault on tribal sovereignty,” said California Democratic Party Native American Caucus First Vice Chair Dr. Joely Proudfit via press release. “Proposition 27 threatens decades of progress for California’s Indians, erodes Tribal sovereignty, and threatens the future economic sustainability of California’s indigenous people.”

That group is backed by the San Manuel Band of Mission Indians, which owns the Yaamava’ Casino, and the Rincon Band of Luiseno Indians and the Pala Casino Spa Resort.

A third group that last week voiced its opposition to Proposition 26, but does not have a stance on Proposition 27, did not weigh in. Taxpayers Against Special Interest Monopolies, backed by the state’s card rooms, opposes the tribal-only initiative, but it has not formally weighed in on the operators’ online proposal.

High bar for licensing is a concern

Proposition 27 is sponsored by some of the most well-known names in sports betting and gaming in the U.S., including BetMGM, DraftKings, and FanDuel, which are taking the lead. Fanatics, the massive sports merchandise purveyor, is also a key sponsor, and the group has already pledged $100 million to get its measure passed. Proposition 27 would allow for statewide digital wagering with platforms tied to tribal casinos. The application fee for operators would be $100 million, while it would be $10 million for tribes choosing to white label, or use their own name as the front-facing brand. In order for an operator to get approval, it must be licensed in 10 other U.S. jurisdictions.

Tribes have argued that the those two requirements set the bar so high that only a limited number of operators would qualify for licenses. The proposition calls for a 10% tax on gross gaming revenue and earmarks most of the tax revenue to address California’s homelessness and mental health issues.

By Jill Dorson