Major League Baseball has come out in support of Proposition 27, which, if passed in November, would legalize online sports betting in California, the world‘s fifth-largest economy.
Endorsements are a bit like kisses: nice, but it depends on who gives them. In this case, MLB’s seal of approval for Prop 27 is a boost for supporters of the measure in the state. Voters also have the option to vote yes on Proposition 26, a competing measure backed by at least 80 Native American tribes that would allow sports betting, but under very different circumstances.
Tellingly, MLB did not mention Prop 26 in its statement, which was sent to the media via MLB Press Box.
“As legalized sports betting continues to grow across the country, Major League Baseball remains committed to protecting the integrity of its games and creating a safe experience for fans who wish to bet on these games,” said the MLB in a statement released Friday. “Proposition 27 — the only measure on California’s upcoming ballot that would license and regulate online sports betting — includes strong integrity provisions designed to help MLB meet those commitments.”
California voters will head to the polls on Nov. 8 to decide the fate of Propositions 26 and 27.
MLB cites safety in support of Proposition 27
In 2018, when the United States Supreme Court struck down PASPA, the federal ban on state licensing of sports betting, it paved the way for states to pass laws to legalize the activity. But even before that, MLB was considering the impact of expanded sports betting on its product.
In 2017, MLB Commissioner Rob Manfred said, “If there is going to be a change in the regulatory structure as it relates to sports betting, we need to be able to engage and meaningfully shape , to try to shape what the new regulatory regime looks like. .”
In 2021, the league had allowed sports betting (once approved by MLB) to partner with teams. In September 2021, the Detroit Tigers became the first team to sign a sponsorship deal with a bookmaker (PointsBet). More than a dozen MLB teams now have official sports betting partners, and broadcast partners now display odds before, during and after games are broadcast.
California is MLB’s biggest market, and there are several reasons why Manfred considers Prop 27 crucial. Two of MLB’s betting partners, DraftKings and FanDuel, were instrumental in the development of Prop 27 and put the strength of their brands behind its passage. Baseball has five teams in California (Dodgers, Giants, Angels, A’s, and Padres), and many of the league’s top American-born players hail from Golden State.
But while baseball has begun to view sports betting as a legitimate source of revenue, it argues that fans are at the heart of its policies. Prop 27, according to MLB, is the best way to kick off sports betting in California.
“The measure would, for example, require (1) sports betting operators to notify leagues of suspicious betting activity, (2) allow leagues to propose restrictions in betting markets particularly susceptible to manipulation, and (3 ) would facilitate other forms of integrity-related cooperation between the state, leagues and operators,” MLB said in its statement.
MLB also mentioned illegal betting, which poses dangers to the consumer.
“MLB believes Prop 27 has the safeguards necessary to create a safe and responsible online sports betting market in California – a state with millions of MLB fans seeking alternatives to illegal offshore betting sites. “
MLB’s public support of Prop 27 illustrates the motivation of proponents of both proposals. Tens of millions of dollars have reportedly been spent in the state to market Propositions 27 and 26.
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What are the differences between prop 26 and 27?
The main differences between the two proposals are:
- Proposition 26 will NOT allow mobile sports betting. It only provides for retail sports betting, particularly at tribal casinos and at four racetracks.
- Prop 26 will use sports betting tax revenue in this manner: 15% from problem gambling programs, 15% from gambling policy enforcement, and 70% from the California General Fund.
- Prop 27 ALLOWS mobile sports betting.
- Prop 27 will spend 85% of taxpayer dollars on affordable housing and 15% will go to tribes that don’t participate in online sports betting.
Both proposals on the November ballot call for a 10% gross income tax rate.
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