CA Sports Betting Prop 27 Sees Minor Support From Homeless Advocates

The San Francisco Chronicle recently ran an article with the headline, “Prop 27 would rake in millions for homelessness. So why don’t homeless advocates support it?”

The article spotlights how Prop 27 earmarks 85% of online sports betting tax revenue to programs addressing homelessness and mental health. But the author writes that Prop 27 never gained widespread support among California’s homeless service providers and low-income housing builders.

PlayCA spoke on the topic with University of Southern California Prof. Gary Painter. As executive director of the USC Homelessness Policy Research Institute, Painter deals with many homeless advocacy groups around the state.

Prop 27 isn’t hot topic among homelessness groups

When someone promises hundreds of millions of dollars a year to your cause, one might think it would at least generate discussion.

But while there are a number of homelessness advocacy groups that have come out for or against Prop 27, Painter says it’s not the hot topic some might think.

“It has not come up as something people are willing to advocate for or against, at least in the circles that I’ve run in,” Painter said. “I have not seen notes or blog posts among the people I follow. It certainly hasn’t been in conversations at the Homelessness Policy Research Institute convenings. It just hasn’t come up organically at all.”

In homeless services circles, Painter said he thinks Prop 27 is viewed as a fight over online sports betting in California. And in order to sell it, they dedicate that money toward homelessness. But it’s not enough money for them to take notice.

A couple hundred million pales to what’s being spent

Prop 27 supporters say it could generate as much as $500 million in annual tax revenue. If 85% goes to homelessness, that’s $425 million a year.

PlayCA is more reserved in its sports betting forecast. With deductions in Prop 27, we project it generates $200 million annually, $170 million toward homelessness.

Between new and continuing funding, the USC Homelessness Policy Research Institute indicates the state is spending about $10 billion on housing and homelessness. That doesn’t include federal, local and philanthropic funding.

In Los Angeles, voters passed measure H and measure HHH in the past six years. Measure H added a quarter-cent sales tax to raise about $350 million annually dedicated to addressing homelessness. Measure HHH issued a $1.2 billion bond to build 10,000 units for the homeless. That’s just in Los Angeles.

“If we’re talking about $200 million, it’s not that large relative to what we’re already doing,” Painter said. “We need more resources, to be clear. We don’t have enough interim housing, shelter or permanent housing resources. So, in that sense, $200 million, it will help. But with the scope of the problem and the set of solutions, it’s certainly not sufficient.”

Prop 27 revenue could get lost in shuffle

An argument made by proponents of Prop 27 is that it would be the state’s first permanent funding source to combat homelessness.

Painter said that, while that’s true, it doesn’t mean as much as it seems.

Painter compared it to the state lottery, an area he researched earlier in his career. In California, the state lottery started from a ballot proposition that went in front of voters in 1984. Just like with Prop 27, proponents of state lottery polled what was the most important issue in the state and it came back education.

So the state lottery proposition created the first permanent funding source for education. But in previous research into state lotteries, Painter found it didn’t have the expected impact.

“My own research in the state lottery was that it didn’t actually increase spending on education in California over the long term when you had a dedicated revenue stream for education and it’s easy to understand why,” Painter said. “The dedicated money is such a relatively small amount given the overall set of money that it’s just really difficult to disentangle, especially over time when you would have inflation anyway.”

When the economy is going well, the overall increase to the general fund could make the Prop 27 money seem inconsequential.

“It is a permanent funding source, but it is a small funding source,” Painter said. “… The step is so small relative to what resources will be allocated regardless, that it will not be consequentially any different than just having a larger state budget for anything and everything rather than something that’s specifically dedicated toward programs to address homelessness.”

Chronicle article on Prop 27’s lack of homeless support

The Chronicle article indicated that Prop 27 has been doing outreach but not getting a lot of takers.

The article quotes Fran Butler-Cohen, CEO of Family Health Centers of San Diego, as saying:

“I don’t think there’s anybody in homeless services that actually thinks that we would realize a windfall from this, that we can instantly start building housing units and getting people off the street and getting them into mental health service. I don’t think anybody thinks that.”

Paul Boden, executive director of the Western Regional Advocacy Project, said the sportsbook companies supporting Prop 27 could use their foundations to help the homeless if that was really their concern.

Homelessness advocacy groups in support of Prop 27

Despite the San Francisco Chronicle’s contention that homeless advocates don’t support it, Prop 27 does have its share of homelessness service groups in support.

Here’s a list of organizations serving the homeless that the Yes on 27 campaign has listed as supporters: