For the last few months, the legalization of sports betting in New York and Florida has garnered plenty of media attention — New York for its odd, high-tax, limited-operator model and Florida for myriad lawsuits, including one that ultimately forced the Seminole Tribe to take down its Hard Rock Digital sports betting platform.
Far bigger California hasn’t gained the same level of notice, though it’s a state with nearly 40 million people, where voters could ultimately have four sports betting initiatives to choose from next year.
Last week, however, a pair of card rooms made a move, suing the California Secretary of State and arguing that a tribal initiative is illegal because it deals with more than one subject. Hollywood Park Casino and Cal-Pac Rancho Cordova (Parkwest Casino Cordova) claim that because the tribes want to add not only retail sports betting but also expand their table games offerings to include roulette and craps, the initiative is out of bounds in relation to the state constitution.
According to the California constitution, “(d) An initiative measure embracing more than one subject may not be submitted to the electors or have any effect.”
According to multiple media reports, the suit reads, “The Initiative’s proponents seek to exploit the popular demand for legal sports wagering by hitching two unpopular wish-list measures to a sports-wagering Initiative.” The lawsuit is the first one filed in California since a coalition of the state’s tribes in 2019 announced it was moving forward with a ballot proposal.
That proposal, which in May was deemed eligible for the November 2022 ballot, would allow for wagering at tribal casinos and four horse racetracks. It is backed by myriad tribes, including the Pechanga Band of Luiseno Indians, and so far is the only wagering initiative that has qualified for the ballot. The initiative also asks voters to allow tribes to add roulette and some dice games as well as allow for the use of private lawsuits to settle gaming disputes.
Card rooms have own proposal
One stakeholder said there seems to be little concern or appetite for the lawsuit. The card rooms, which have long been at odds with the tribes over gaming, are running their own ballot initiative campaign to legalize statewide mobile wagering and retail wagering at card rooms, professional sports venues, and racetracks. The proposal has been cleared for signature gathering. In California, 997,139 verified signatures are needed to get on the November 2022 ballot.
The proposal also would allow the card rooms to add “additional games that are played with cards or tiles.”
The next big California election … will be a battle b/w traditional card rooms, apps like Draftkings, and Native tribe-owned casinos collectively spending over $100 million on dueling ballot measures to control the sports betting market. Kinda sad. https://t.co/ay4ombQvXC
— Lee Fang (@lhfang) November 2, 2021
The card room proposal is one of three that could land on the ballot in addition to the tribal retail-only initiative. A coalition of operators, headlined by Bally’s, BetMGM, DraftKings, Fanatics, FanDuel, Penn National/Barstool Sportsbook, and WynnBET, are also collecting signatures for their own initiative that would allow for statewide mobile wagering with platforms tethered to tribal casinos. The proposal does not address retail wagering and would be “complementary” to the tribes’ own retail initiative.
Tribes update mobile proposal
The operators’ initiative would funnel all tax revenue to solutions for homelessness and mental health issues. According to the political committee collecting signatures for the California Solutions to Homelessness and Mental Health Act, “our measure is receiving an overwhelmingly positive response from the public. On signatures, we are well ahead of where most ballot measure campaigns are at this point in the election cycle, and we are very much on track to qualify.”
A fourth proposal is backed by at least four of California’s tribes, including the San Manuel Band of Mission Indians, and would allow for retail and statewide mobile wagering. That proposal was the last filed, and it is still being reviewed by the attorney general’s office. The Age-Verified Tribal On-Line and In-Person Sports Wagering & Homelessness Solutions Act is scheduled to get a title and summary by Jan. 11, at which point proponents could begin collecting signatures.
California Politics: A sports betting showdown in 2022 https://t.co/9ZTB35tgwa
— Ranon J Sams (@ranon_j) December 25, 2021
The proposal was updated Dec. 13 in response to the Florida lawsuit, in which a U.S. District Court judge deemed the Seminoles’ compact with the state illegal. Judge Dabney Friedrich wrote that the compact violates the Indian Gaming Regulatory Act, which sets out the guidelines for wagering on tribal lands, by allowing for bets placed anywhere in the state to be considered “on tribal lands” if they flow through a server on Seminole land. The new language in the California tribal proposal is designed to allow the tribes to offer statewide mobile wagering even if federal courts still rule that that it is impermissible under IGRA.
In other states, including Arizona and Connecticut, tribes are already offering statewide mobile wagering because those states not only ratified tribal compacts, but also legalized statewide mobile wagering. Under that scenario, if a state legalizes, then tribes can also participate. In Florida, lawmakers approved the compact, but did not otherwise legalize wagering, giving the Seminoles a monopoly.