MLB Comes Out Swinging for Online Sports Betting, Backs California Prop 27

Proponents for online sports betting in California picked up a big endorsement Friday morning when Major League Baseball announced its support for Proposition 27.

San Diego
San Diego
An aerial view of San Diego, with Petco Park – home of MLB’s San Diego Padres – in the forefront. On Friday, MLB announced its support for Prop 27, a proposed constitutional amendment to legalize online sports betting in California. (Image: Crown Point Design/Adobe Stock Images)

The professional sports league said in a statement that protecting the game’s integrity is paramount and it also wants to protect fans seeking to bet on games.

Proposition 27 – the only measure on California’s upcoming ballot that would authorize and regulate online sports betting – includes strong integrity provisions designed to help MLB carry out those commitments,” the league said.

Prop 27 is backed by seven national sports betting operators – BallyBet, Barstool Sportsbook, BetMGM, DraftKings, Fanatics, FanDuel, and WynnBET. Those companies have provided $150 million to “Californians for Solutions to Homelessness and Mental Health Support” for a campaign to get the measure on the Nov. 8 ballot and get voters to approve it.

The measure is one of two sports betting measures on the ballot in California. Tribal gaming interests are funding Proposition 26, which would allow retail sportsbooks at tribal casinos and state-licensed racetracks. Most tribal entities in the state are backing Prop 26 and opposing Prop 27.

Combined with the millions in funding put up by tribal gaming interests, as well as the millions by cardroom casino operators that oppose the tribal gaming measure, the sports betting initiatives are likely to break a spending record in California for a ballot initiative.

MLB’s endorsement comes just a couple of days after two key educational groups, as well as Republican and Democratic state legislative leaders, announced their opposition to Prop 27.

PASPA Ruling Changed Relationship

For decades, MLB and the rest of the major professional sports leagues vehemently opposed sports betting. It also was one of the organizations that sued to block New Jersey from offering sports betting, and that case led to the Supreme Court striking down PASPA, the federal law that prohibited most states from legalizing and regulating the wagering product.

Since the PASPA repeal in May 2018, MLB and the other professional leagues have turned from adversaries of sportsbooks to allies.

MLB’s statement lists three examples of how Prop 27 would safeguard the game. The measure requires operators to inform sports leagues of any suspicious betting activity, and it gives the leagues the ability to implement restrictions on some wagering markets. The initiative also requires the leagues, operators, and state officials to work together on sports betting integrity matters.

“MLB believes that Prop 27 has the safeguards to create a safe and responsible online sports betting market in California––a state with millions of MLB fans looking for alternatives to illegal offshore betting sites,” the league’s statement said.

Interestingly, at last month’s MLB All-Star Game, which was held at Dodger Stadium in Los Angeles, MLB Players’ Association Executive Director Tony Clark expressed concern about the relationship between the league and sportsbooks.

“We’re entering a very delicate, and dare I say, dangerous, world here,” Clark told reporters. “We hope that it is truly beneficial for our game moving forward and that everyone who is involved benefits from it in one fashion or another. But when you have players suggest that no sooner was PASPA repealed, that they started to have book houses following them on social media, that gets you a little twitchy pretty quick.”

About California’s Prop 27

Prop 27 is a constitutional amendment to legalize online sports betting in California.

If approved, operators would be able to acquire a license to offer betting in the most populous US state for $100 million. In order to qualify, operators must be licensed in at least 10 states or five if they also operate 12 Class III casinos in the US. Operators must also partner with a California-based tribal nation.

Tribes may also acquire licenses on their own at a cost of $10 million, but they face restrictions on how their apps can be branded.

The measure calls for a 10% tax on sports betting revenues generated by commercial operators. It allocates 85% of the tax revenue for programs to support the homeless and bolster mental health programs across the state. The remaining 15% would go toward economic development initiatives for tribal nations not engaged in sports betting.

“We appreciate MLB’s strong support for the sports integrity provisions in Prop. 27,” Californians for Solutions spokesperson Nathan Click said. “Prop. 27 is the only measure that provides permanent solutions to homelessness and mental health in California, and it does so by creating a safe and responsible online sports market that is already working in more than half the country.”

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