Tribal Casinos Seek More Time For Ballot Initiative That Could Redefine Sports Betting

Posted on June 10, 2020

Even if the California Legislature is successful in amending the state constitution to legalize sports betting this fall, the legal framework may not exist for long. A new tribal sports betting lawsuit could lead to future changes.

The Coalition to Authorize Regulated Sports Wagering, an organization for CA tribal casino operators, filed the complaint on Tuesday. It seeks more time to get an amendment proposal on the ballot for CA voters.

Why the tribal sports betting lawsuit?

Since January, the coalition has been working on gathering signatures for a petition to put the proposed constitutional amendment on the statewide ballot. The state constitution allows for such referendums if petitions gain nearly a million signatures from registered voters.

The proposal would authorize land-based sports wagering at California tribal casinos and racetracks. It would not allow for online sports betting, however.

The coalition argued that the coronavirus pandemic derailed the progress of gathering signatures.

Kenneth Kahn, the chairman of the Santa Ynez Band of Chumash Indians, spoke to that effect:

“This is about seeking to preserve the people’s democratic right to pursue an initiative during the pandemic. Tribal leaders temporarily suspended signature gathering as a sacrifice to protect everyone’s public health.”

The complaint asks the court to compel CA Secretary of State Alex Padilla to give the coalition at least 90 more days to gather signatures. The coalition has changed its target date, however.

November 2020 no longer the deadline

When the coalition began its petition efforts, the goal was to get its proposal on the ballot for the statewide fall election. The coalition is now targeting the 2022 midterm election.

Currently, the deadline for that election is July 20. However, if the tribe gets its extension, it would have until late October to gather the requisite 997,139 signatures.

This shift in the coalition’s strategy eliminates the possibility that CA voters will see competing sports betting amendment proposals on the ballot this November. The California Legislature is currently working toward that end.

Meanwhile, elsewhere in Sacramento

Also on Tuesday, tribal casino representatives were taking other actions to secure their interests. The California Senate Appropriations Committee held a hearing on SCA 6, another potential constitutional amendment.

Among other things, the amendment would legalize sports betting in CA. There are several key differences between the Senate’s proposal and the tribal amendment, however.

The principal difference is the Senate’s proposal would include online wagering at tribal casinos and racetracks. It would also allow off-track betting sites to offer both online and retail betting.

The committee moved SCA 6 to suspension on Tuesday. That gives the Senate Finance Office the time to produce a report on the financial ramifications. The committee could send it to the full Senate as soon as June 18.

The CA constitutional amendment proposals require 60% approval in both chambers of the state legislature. The legislature faces a deadline for doing so as well, which is just one week after the June 18 meeting.

Scenarios aplenty in play for CA

Tribal casino operators vehemently oppose SCA 6, even though it would give them the ability to offer sports betting, because of its language regarding CA cardrooms. It would make the offering of table games in CA cardrooms expressly legal, which is a gray area that tribal casino leaders have fought against for years.

The same tribal leaders also oppose online wagering on sports. They would rather compel CA bettors to visit their facilities to place bets.

For those reasons, Californians should expect the tribes to push for their own version as long as they can. All this activity creates the potential for many different scenarios for legal sports betting in California.

Here are a couple of the most likely scenarios, including what it would take to make them happen and the possible ramifications.

Bettors see sports betting referendums in November 2020, 2022

  • What it would take: Both the California House and Senate approve SCA 6 by a margin of at least 60% and the coalition is successful in getting the requisite number of signatures by its deadline.
  • What happens immediately: Padilla adds a question to the ballots for both elections, asking CA voters whether they approve of the amendment proposals.
  • The possible long-term effects: If voters approve SCA 6, tribal leaders’ first move might be to sue to block its implementation pending the result of the vote on their referendum. If they decline to do so or that fails, that could spell death for their ballot measure. It might be difficult to convince voters to give up legal online wagering once they have it. Additionally, cardrooms would probably advocate against the tribal proposal. However, if the tribal measure were to receive enough votes in 2022, it would override SCA 6 where appropriate.

Bettors see competing proposals on 2022 ballot

  • What it would take: The coalition gathers enough signatures before its deadline but the CA Legislature misses out on getting SCA 6 approved before June 25. The legislature then succeeds in getting another measure on the ballot for 2022.
  • What happens immediately: CA’s electorate can vote to approve or deny both or either of the proposals. If at least 50% plus one of the voting bloc approve both measures, then the one that got the most “yes” votes controls where the two differ.
  • The possible long-term effects: The results of the votes on both proposals will determine this situation. If the legislature’s measure largely resembles SCA 6 and gets the most affirming votes, it would be a win for online wagering and CA cardrooms. If the tribal measure prevails, it would mean a restriction to land-based wagering and an uncertain continuation of CA cardrooms.

The CA Legislature’s activity over the next two weeks could prove huge in terms of the future of sports betting. Similarly, tribal casinos are facing a time crunch. That’s what their lawsuit is all about.

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Derek Helling

Derek Helling is a freelance journalist who resides in Kansas City, Mo. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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