Proposition 27: Allows online and mobile sports wagering

What is Prop 27?

Yes: A YES vote on this measure means that licensed tribes or gambling companies could offer online sports betting over the Internet and mobile devices to people 21 years of age and older on non-tribal lands in California. Those offering online sports betting would be required to pay the state a share of sports bets made. A new state unit would be created to regulate online sports betting. New ways to reduce illegal online sports betting would be available.

No: A NO vote on this measure means that sports betting would continue to be illegal in California. No changes would be made to the way state gambling laws are enforced.

(Source: California's Office Voter Information Guide)

Background

Legalizes online and mobile sports wagering, which currently is prohibited, for persons 21 years and older.

Such wagering may be offered only by federally recognized Indian tribes and eligible businesses that contract with them. Individuals placing bets must be in California and not located on Indian lands. It imposes a 10% tax on sports-wagering revenues and licensing fees. Directs tax and licensing revenues first to regulatory costs, then the remainder to: 85% to homelessness programs; 15% to nonparticipating tribes. It specifies licensing, regulatory, consumer-protection, and betting-integrity standards for sports wagering. 

Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local governments: 

  • Increased state revenues, potentially reaching the mid-hundreds of millions of dollars annually from online sports wagering-related taxes, licensing fees, and penalties. Some portion of these revenues would reflect a shift from other existing state and local revenues. 
  • Increased state regulatory costs, potentially reaching the mid-tens of millions of dollars annually that would be fully or partially offset by the increased revenues.  
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