Make it four sports betting initiatives jostling to make the November 2022 election in California.
Three Native American tribes in the state are preparing to file a mobile sports wagering initiative this week. The proposal limits mobile sports betting to Indian tribes.
The Rincon Band of Luiseno Indians, Federated Indians of Graton Rancheria and Wilton Rancheria are the three tribes behind the initiative.
The tribes filed the initiative Friday with a surprise fourth tribe among the petitioners. The San Manuel Band of Mission Indians, which had been rumored to be considering a California sports betting initiative of its own, joined in this offering.
It also includes brick-and-mortar sports betting limited to tribal casinos, possibly putting it in conflict with the qualified tribal measure. Like that proposal, it adds craps and roulette to the games allowed at tribal casinos.
The qualified tribal measure is one of three sports betting initiatives already on the docket in California. The other two are backed by sports betting operators and California card rooms.
Details of California tribal mobile sports betting initiative
Here are some of the key provisions of the proposed initiative:
- Following the model established by the Seminole Tribe in Florida, all mobile servers must be located on tribal lands. The legality of this provision under the Indian Gaming Regulatory Act is being tested in court.
- The initiative includes a template compact amendment for tribes to participate in sports betting. Tribes can choose to pursue their own negotiations with the state.
- The template compact amendment provides 10% of adjusted sports wagering gross gaming revenue to the state to combat homelessness and mental illness. The operator initiative earmarks sports betting revenue to the same two issues.
- Another 10% of adjusted sports wagering gross gaming revenue is set aside for non-gaming and limited-gaming tribes, as is consistent with current compacts.
- Permits wagering on professional, college and amateur athletic events.
- Prohibits wagering on high school sports.
- Allows tribes that don’t wish to offer statewide mobile sports betting to contract with other tribes to provide marketing services and/or account registration services through a hub-and-spoke model without the need for a compact amendment.
- No licensing fees for tribes to participate in sports betting.
Unlike the qualified tribal initiative, this new proposal does not allow horse race tracks to participate in sports betting. It also leaves out other potential sports betting participants such as card rooms and sports teams.
It does not include the provision of the qualified tribal initiative that draws the most ire from card rooms. That provision sets up the possibility for tribes to go after card rooms directly with civil lawsuits under the Private Attorneys General Act (PAGA).
Operator initiative led to new tribal proposal
In a letter to fellow tribes notifying them of the proposal, the petitioners explained their reasons for pursuing another California sports betting initiative.
Two of the tribes are part of the coalition backing the qualified tribal initiative.
The operator initiative also requires that operators partner with tribes. However, some tribes have sovereignty concerns with the operator initiative. The petitioners wanted a mobile wagering option controlled by tribes.
The letter explains:
“We believe that there is a grave risk that either the DraftKings Measure 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.”
Rincon and Wilton have preexisting gaming partnerships that could help in a move to offering statewide mobile sports betting. Rincon’s Harrah’s Resort Southern California is operated by Caesars Entertainment, which earlier this year acquired sports betting operator William Hill.
Earlier this year, Wilton partnered with Boyd Gaming to operate a second casino. Boyd is a strategic partner and 5% equity owner in FanDuel, one of the leading backers of the operator initiative.
California tribes face short time frame to qualify initiative
In the letter to other tribes, Rincon, Graton and Wilton tribal chairmen explained that they have not yet decided to collect the 997,139 valid signatures required to make the ballot.
However, they needed to get a measure filed to retain the possibility of doing so. They will have a couple of months to determine whether to move forward, as it takes 65 days for the California Attorney General to issue title and summary to circulate the petition.
Qualifying the measure this late in the game will be a difficult and expensive proposition. City leaders filed the card room-backed initiative Aug. 19 to give it the full six months to gather signatures. The sports betting operators filed their initiative Aug. 31.
The letter asks for other tribes to submit comments and proposed changes to the initiative by Dec. 10. The petitioners will have 35 days from filing to amend their initiative.
Many California Indian tribal leaders will gather in two weeks at the National Indian Gaming Association conference at Pechanga Resort Casino.
