In a sign that at least some of California’s gaming tribes want to make sure it is those in Indian Country who dictate how and when digital sports betting will be part of the Golden State landscape, the Rincon Band of Luiseno Indians and Federated Indians of the Graton Rancheria and Wilton Rancheria tribes on Friday wrote a letter to their peers outlining a ballot initiative proposal. If approved, the initiative could be the fourth on the 2022 ballot, the third involving mobile wagering, and the second put forth by the state’s tribes.
The proposal outlined in the letter would allow for statewide mobile gaming with in-person registration. It sets Sept. 1, 2023, as the earliest possible launch date, and also includes legal retail wagering and the addition of several table games, similar to the retail tribal initiative that has already qualified for the November 2022 ballot.
The letter, of which Sports Handle has obtained a copy, was first circulated on the same day 43 tribes published a letter opposing initiative proposals from commercial operators and local card rooms. The three tribes behind the latest effort are among the more sizable in the state, and at least three signed off on the opposition letter.
As of Tuesday, only one of the four initiatives — the “California Sports Wagering Regulation and Unlawful Gambling Enforcement Act,” backed by a coalition of 18 tribes — has qualified for the November 2022 ballot. The proposal would allow for retail sports betting at California’s tribal casinos and four horse racetracks, as well as the addition of craps and roulette to tribal casinos. Two other initiatives are in the approval or signature-gathering process.
Tribes want to control when/how/where
A sense of urgency is apparent in the latest letter, which reads, in part, “We believe we must file this
initiative so that, if necessary, California tribes will have a full range of options available in the
November 2022 election to defend their exclusivity over class III gaming in California.”
Proposed ballot measures must be approved for the ballot by June 2022, but it can take a little more than two months to get a title and summary from the attorney general’s office before signature gathering can begin. That means that if the tribes filed today, it would be early January before they could begin gathering the 997,139 signatures needed.
2 ballot measures would OK sports betting in California tribal casinos. Why are tribes opposed?
Story by @JeffHorseman: https://t.co/Sk15f72Y5B pic.twitter.com/ALkbbU8si5
— Beau Yarbrough ⌚🐕 (@LBY3) November 2, 2021
The tribes continued in their letter, “We believe that there is a grave risk that either the DraftKings Measure (the commercial operators proposal) or the Cardrooms Measure could pass. Right now, tribes do not offer California voters an option for online sports wagering. If the DraftKings Measure or the Cardrooms Measure passes in November 2022, tribes would lose their exclusivity to Class III gaming in California and such passage would accelerate the legalization of online gaming by non-tribal interests, threatening the existence of Indian gaming as we know it.”
The level of concern in the letter is unusual, at least publicly. The tribes usually take the position that they are in no hurry to expand gaming, and that they do have the power and financial backing to lobby hard against the existing proposed initiatives. However, in California, once an initiative is on the ballot, it needs only a simple majority to pass. With seven operators behind it and a $100 million war chest, the tribes are likely worried that the operators, whose measure is called the “California Solutions to Homelessness and Mental Health Support Act,” could well drum up that much support. That proposal is considered complementary to the tribes’ retail proposal, so both could pass.
Operators previously told Sports Handle that they were working with the tribes on the proposal and that they would not have moved forward without believing that they had at least some tribal support.
Money earmarked for key state issues
In the latest letter, the three tribes outline a landscape that would allow for statewide mobile wagering “under the protections provided by IGRA,” the preservation of exclusivity for Class III gaming, the creation of a revenue-sharing trust fund, and a commitment of 10% of gross gaming revenue earmarked for homelessness and mental health solutions. The 10% commitment would be, according to the letter, a quid pro quo for the state of California to allow for statewide mobile wagering.
Bally’s, BetMGM, DraftKings, FanDuel Fanatics, Penn National/Barstool Sportsbook, and WynnBET built their proposal around homelessness and mental health issues. Polling by the operators’ political committee has shown significant support among voters, so it would be a wise decision for the tribes to offer up something similar. Traditionally, the tribes have not committed a precise amount to the state for a specific issue or fund.
“I typically stay away from morality tied to housing and homelessness because to me it’s a moral failure in our state that we have so many of our neighbors sleeping outside every night."- @Meeksmoss
Sports betting could mean millions to help CA homeless https://t.co/yo4ZmcsUHD
— Joe Garofoli (@joegarofoli) October 24, 2021
There are key differences between the tribal proposal and the operators’ proposal. In California, those proposing a ballot initiative essentially are writing the law. In their letter, the three tribes invited feedback from tribes, but suggest they’ll file an initiative within the next week or two.
A notable difference between the new tribal proposal and those put forth by others is that the tribes would control the bet menu. The language in the proposal allows for wagering on most professional sports leagues in the U.S. and abroad, and also allows for wagers that are similar to those offered in other legal U.S. jurisdictions. What it does not do is allow for sports governing bodies to request that certain bet types be removed or include an official league data requirement. Rather, any changes to the bet menu must originate in Indian Country.
In many wagering laws that have been passed since PASPA fell in 2018, sports governing bodies have the right to request that certain types of wagers be prohibited. And a handful of states mandate the use of official league data.
Be sure to read the fine print
The current proposal also includes the following:
- Each tribe would be entitled to one mobile skin.
- Digital platforms must be branded under a tribe’s name as a “registered or trademarked brand or associated brand actually used by the tribe to market its gaming operation(s) as of October 1, 2021, or (iii) the name or any registered or trademarked brand of any affiliate entity wholly-owned by the tribe.”
- Wagering on professional, college, and amateur sports would be legal.
- Guidelines for where within a “gaming facility” that kiosks could be placed.
- The legal age for wagering would be 21.
- Specific advertising guidelines, including a ban on advertising to anyone under the age of 21, but no funds earmarked for responsible gaming programs.
- Anonymous bets are capped at $1,999.99.
The proposed initiative also includes a “hub-and-spoke” section, in which non-gaming tribes cannot only market for gaming tribes, but could offer digital wagering under the “hub” (gaming) tribe’s brand. The language details how such a deal would be structured. And while it is similar to the hub-and-spoke model being employed by the Seminole Tribe in Florida, a key difference is that in California, the hub-and-spoke applies only to tribes, rather than a combination of tribal and commercial operators.
Along with that, the proposal outlines a “model form of sports wagering compact amendment” that tribes could use in lieu of re-compacting.
