Should sports betting be legalized in CA? Gov. Newsom, Graton Casino, Bay Area groups weigh-in

SAN FRANCISCO -- Should sports betting be legalized in California? And, if so, how?

Those are the questions at the heart of two dueling propositions on the November ballot.

Prop 26 would legalize sports gambling just in person at tribal casinos and at four horse racing tracks across the state.

Prop 27 would legalize sports betting online. It would allow big gaming companies -- like FanDuel and DraftKings, which are funding the initiative -- to partner with tribes to allow people to place bets from anywhere, even on your phone.

The oversimplified way of looking at it is that Prop 26 is backed by the big, Native American tribes. Prop 27 is backed by the big, out of state gaming companies. The reality, though, is that it's much more complex with a complicated web of competing interests at play -- all of whom are jockeying for control over the potential multi-billion dollar sports betting industry.

Supporters of Prop 27 say the initiative would bring in hundreds of millions of dollars in tax revenue for the state. It's money that would go towards addressing homelessness and mental health issues. That's why Community Forward in San Francisco -- which is in the process of building a new shelter for unhouse women -- is supporting it.

"Prop 27 builds in funding that is long term and really matches the size of the crisis that we're facing," Sammie Rayner, the group's chief operating officer, told ABC7 News. "If we don't have a secure pot of funds, a sustainable pot of funds to support homeless services, we're never going to end the cycle of homelessness."

But some homeless advocates disagree. A "No on Prop 27" group is running a new ad featuring a domestic violence shelter employee who claims "90% of the money goes to out of state corporations who wrote it."

"Very little is left for the homeless," she says.

Greg Sarris, the Chairman of the Federated Indians of Graton Rancheria -- which operates Graton Casino in Sonoma County -- is part of the "Yes on 26, No on 27" group. He told ABC7 News that Prop 27 would hurt Native American tribes by giving gambling power to the out of state gaming companies.

"California Indians have worked so hard to create a business that helps us sustain ourselves," Sarris said. "We don't want an outside group coming in and not only doing mobile sports betting, which is dangerous, but setting a precedent for other kinds of gambling in the state of California that would impinge on our business."

While some 60 Native American tribes across the state are against Prop 27, there are at least three small tribes -- including Big Valley in Lake County -- that are supporting it. Prop 27 spokesperson Nathan Click said rural tribes that don't have foot traffic like Graton Casino does could benefit from online sports betting.

"Through prop 27 they'll be able to participate in the online sports betting market place and deliver real benefits to their tribes," Click said.

However, other tribes are concerned the high cost of entry for online sports betting -- including a $10 million licensing fee -- would limit the number of tribes who could participate.

So far, more than $350 million has been poured into these two props -- a campaign finance spending record. Much of that money has been spent on dueling -- and non-stop-- television ads.

The California Republican Party is opposed to both Prop 27 and Prop 26.

The California Democratic Party is opposed to Prop 27 but neutral on Prop 26.

Governor Gavin Newsom is also neutral on Prop 27. However, he told reporters at an event in Los Angeles this week that the proposition is not about fighting homelessness.

"I know initiatives and folks will say anything. Perhaps that initiative will provide a few dollars," Newsom said. "I'm not supporting or opposing it, I haven't given it a lot of thought, but it is not a homeless initiative. I know Angelenos can read between the lines and they know better."