A bill filed in Arizona last week would not only allow every tribe to obtain an event wagering license, but also outlines a plan to put tribal-owned sportsbooks on commercial land within a five-block radius of professional stadiums.
The legislation, authored by Sen. Sally Ann Gonzales, explicitly describes allowing brick-and-mortar sportsbooks “on land that is not identified as Indian land pursuant to the Indian Gaming Regulatory Act.” The IGRA governs wagering on Indian lands, and it appears Gonzales’ proposal would be in violation of the act.
When Arizona lawmakers legalized sports betting in 2021, they did so by allowing for up to 20 “event wagering” licenses, which would allow licensees to offer retail and statewide digital betting. The bill allots 10 licenses to professional sports franchises and 10 to tribes. There are an additional 10 retail-only licenses available for racetracks.
While lawmakers called this “parity,” the concept was flawed from the start, as there are not enough professional sports franchises that meet the criteria to use all 10 licenses, and there are 23 tribes. The net result has been that two pro franchise licenses are currently unclaimed, while about 13 tribes have been shut out of offering sports betting. Gonzales’ bill would allow for 23 tribal licenses.
“The addition of licenses for all tribes should have been something that was included in the original legislation, but proved the short-sightedness of the bill’s authors to think tribes should not have equal standing as teams in the state,” Las Vegas-based consultant Brendan Bussmann told Sports Handle. “Other states with strong tribal presences should learn from the challenges that have occurred in Arizona and not try and reinvent the wheel as they look at their own sports betting regulatory structures.”
Hiccups en route to go-live in Arizona
Gonzales’ bill was filed on Feb. 2 and has been referred to the Commerce and Rules Committee, but no hearing date has been assigned.
It’s been less than a year since lawmakers legalized sports wagering on April 15, and only five months since operators began taking bets. In that time, regulators developed rules and faced some hiccups on the way to the launch of seven operators on Sept. 9.
Among the issues was that the Arizona Department of Gaming awarded — and then took back — a license to PointsBet in partnership with the Yavapai-Apache Nation, and two lawsuits seeking to delay go-live were filed. Immediately before launch, the Yavapai-Prescott Tribe, of which Gonzales is a member, filed a lawsuit requesting a delay to the start of wagering. The tribe, which did not renegotiate its compact to include gaming, called the new law unconstitutional, but a judge disagreed and allowed operators to launch.
Turf Paradise and Eight OTBs Receive Arizona Sports Betting Limited Operator License! pic.twitter.com/25bci7WYJK
— Turf Paradise (@turf_paradise) January 27, 2022
The Yavapai-Prescott Tribe’s reservation is about 100 miles north of Phoenix, in a somewhat rural area that may not be conducive to building a sportsbook. The idea that a tribal-owned sportsbook could be located off tribal land is a clear a violation of the IGRA. Several years ago, another Arizona senator floated a plan that would have put tribal-owned kiosks into commercial properties, including bars and private clubs, but the bill did not get any traction.
Under the state’s new law, a tribe can contract with a commercial operator to offer statewide digital wagering, as 10 tribes are currently already licensed to do. But it seems a big ask to put a brick-and-mortar sportsbook somewhere off tribal land and, more specifically, in close proximity to a professional sports franchise’s venue.
Arizona is one of five states that allows sportsbooks at professional sports arenas. So far, FanDuel has opened at Footprint Center, Caesars Sportsbook has betting windows at Chase Field, and other major operators have deals with the NFL Cardinals, NHL Coyotes, WNBA Mercury, AFL Rattlers, TPC Scottsdale, and Phoenix Raceway for brick-and-mortar locations. All are already live with digital platforms.
Operators could push back
Part of the new law allows those operators to open a sportsbook within the venue and a second one within five blocks. Unlike in other jurisdictions, there is no hard exclusion zone for other operators around the venues, but it’s likely commercial operators will push back on Gonzales’ plan to put tribal-owned sportsbooks within five blocks of arenas and stadiums.
Here's a look at the new 20,000 square foot, two-story Caesars sportsbook that will be opening just outside of Chase Field, home of the Arizona Diamondbacks, in early 2022. It will feature two floors of sports betting space, a full-service bar, VIP lounge and an extensive menu. pic.twitter.com/I9paQKdPIN
— Arash Markazi (@ArashMarkazi) September 1, 2021
From the new bill:
E. A LICENSE ISSUED BY THE DEPARTMENT PURSUANT TO THIS SECTION AUTHORIZES AN EVENT WAGERING OPERATOR IDENTIFIED IN SUBSECTION A, PARAGRAPH 2 OF THIS SECTION TO OFFER BOTH:
1. EVENT WAGERING IN THIS STATE THROUGH AN EVENT WAGERING FACILITY WITHIN A FIVE-BLOCK RADIUS OF A SPORTS FACILITY OR SPORTS COMPLEX. THE EVENT WAGERING FACILITY MAY BE LOCATED IN RETAIL OR COMMERCIAL SPACE ON LAND THAT IS NOT IDENTIFIED AS INDIAN LAND PURSUANT TO THE INDIAN GAMING REGULATORY ACT (P.L. 100-497; 102 STAT. 2467).
2. EVENT WAGERING THROUGH A MOBILE PLATFORM AS SPECIFIED BY THE DEPARTMENT. A LICENSED EVENT WAGERING OPERATOR OR ITS DESIGNATED MANAGEMENT SERVICES PROVIDER MAY OFFER EVENT WAGERING THROUGH AN EVENT WAGERING PLATFORM AS SPECIFIED BY THE DEPARTMENT.
Gonzales did not immediately respond to email and phone inquiries from Sports Handle.