How Two Major Gambling Proposals Were Defeated in California on Nov. 2, 2004
By: California Coalition Against Gambling Expansion
California rjects gambling expansion

Background: On March 8, 2004, the Board of Directors of the California Council on Alcohol Problems (CAP) spent several hours discussing proposals to expand gambling in California. Fred Jones, CAP's attorney, led the group through printed copies of two proposed initiatives. Five major racetracks and 11 major card clubs had submitted a 17-page petition, that later became Proposition 68. The Agua Caliente Tribe of Palm Springs had submitted a seven-page petition that became Proposition 70. After serious discussion and prayer, the CAP Board, which also serves as the Board of the California Coalition Against Gambling Expansion (CAGE), voted to oppose both initiatives and to mount a campaign for their defeat.

The ultimate purpose of Prop 68 was to legalize 30,000 slot machines in the 5 racetracks and 11 card clubs. Government was to receive 33% of these slot machine proceeds. Legalizing slot machines for the tracks and card clubs was the ultimate purpose of Prop 68. The publicized rationale for Prop 68 was to require all Indian casinos to share 25% of their profits with the State. It was obvious from the beginning that no one believed that the Indian casinos would give 25% of all their profits to California forever.

"Fair Share" became the rallying cry. Governor Schwarzenegger had campaigned on the promise of getting a fair share of casino profits for the State. Many citizens favored casinos helping to pay for roads, traffic congestion, law enforcement, zoning requirements, water controls, environmental concerns, etc. Prop 70 provided that a "fair share" of casino profits would be the normal corporation tax (8.8%) that is paid by all California businesses. Prop 70 also provided that Tribes could operate an unlimited number of casinos on their trust lands, could offer all types of gambling devices, and replace their two-year compacts with 99-year agreements.

The Campaign: Both initiatives constituted a massive expansion of gambling in California. CAP/CAGE prepared position papers against both Initiatives. Our facts emphasized the adverse impact that increased gambling would have on the economy, but also mentioned the social costs: addictions, embezzlements, bankruptcies, marital disputes, divorces, suicides and crime. A packet of materials was sent to 9500 California churches and more than 1,000 friends of CAP/CAGE. CAP's materials were widely distributed in congregations, in neighborhoods, and among personal friends. Our materials were shared with the media and were included in editorials, TV and radio programs, in letters to the editor, etc. Harvey Chinn, the Director of CAP/CAGE, appeared with Governor Arnold Schwarzenegger at a press conference in Sacramento on Oct. 19, which focused on defeating Props 68 and 70. Most of the state's newspapers editorialized against both initiatives. Labor unions, environmental groups, the California Chamber of Commerce and many other groups opposed both propositions.

The tribes spent $30,600,000 in their efforts to pass Prop 70. The racetrack and card club owners invested $27,000,000 to convince voters to enact Prop 68. Two weeks before the election, the tracks and card clubs discovered that their efforts were turning voters against more gambling. They ended their advertising campaign. The Tribes, however, actually increased their campaigning.

Decisive Rejection: Only 16% of the population voted to put slots machines in racetracks and card clubs. An overwhelming 84% voted "NO" on Prop 68. By a 76% "NO" vote, Californians also turned down the tribes' efforts to expand casino gambling. Only 24% voted for the tribes - a remarkable contrast to the huge ballot victories the Indians won in 1998 and 2000.
Proposition 68 results: YES: 1,535,303 (16%); NO: 7,871,244 (84%).
Proposition 70 results: YES: 2,256,801 (24.%); NO: 7,114,708 (76%).

"The people have spoken - no more casinos"
- Headline in the San Francisco Chronicle - Nov. 17, 2004

California Coalition Against Gambling Expansion
803 Vallejo Way, Sacramento, CA 95818 (916) 441-1844