Federal Bill Could Greenlight Online Sports Betting for California Tribal Casinos

Posted on December 23, 2019

Tribal casinos around the United States, even in states where online¬†sports betting is legal, currently don’t offer online wagering. A federal tribal gaming bill could change that.

While the state of California is in the very early stages of potentially legalizing sports betting, the existence of H.R. 5502 adds an interesting wrinkle. If the proposed bill becomes law, it could give Golden State tribal casinos new leverage.

Details on the new federal tribal gaming bill in Congress

On Thursday, Dec. 19, New York Congressman Anthony Brindisi’s bill was referred to the US House Committee on Natural Resources. As the current term ends soon, it’s unlikely any more action will be taken on it this year.

The bill essentially legislates around a former federal court decision. As pointed out by gaming attorney Daniel Wallach, that decision muddies the waters on this matter.

The case in question is California v. Iipay Nation of Santa Ysabel of 2018. The federal 9th Circuit Court ruled in that case that the tribe’s compact did not allow it to offer mobile sports betting.

This bill would clarify that mobile sports betting is within tribal casinos’ legal offerings as far as federal law is concerned. While tribal casinos around the country are likely to support this bill, it’s too early to tell what kind of support it has in Congress.

If it were to become law in its current form, it wouldn’t necessarily mean that California’s tribal casinos could immediately start offering online sports betting, however. That’s because tribal gaming is also subject to compacts that tribes have with their respective states.

This change on the federal level might cause the Golden State’s tribes to change one of their key positions, though. They are already active on the sports betting legalization front.

How California’s tribal operators might adjust to new law

If the federal government clears the way for tribes to offer online sports betting, potential tribal operators in California might pull their proposed constitutional amendment.

In its current form, the tribal proposal makes no provision to legalize mobile/online betting in the Golden State. That is likely because they do not plan to offer it, for a variety of reasons.

Furthermore, the tribes wouldn’t want to allow potential competitors to offer online wagering. The California tribes believe their compacts with the state give them the exclusive ability to offer legal sports betting.

If it becomes clear they are allowed to offer the product, the tribes may drop their opposition to legalization of online betting. It’s unlikely, however, they will stop insisting upon exclusivity.

It’s uncertain how likely California is to acquiesce. So far, the state hasn’t effectively enforced the tribes’ interpretation of the law in regards to California card rooms offering blackjack-style games.

A meeting in Sacramento next month will address this very issue.

A tenuous situation for everyone in the Golden State

It might be in the tribes’ best interest to try to hold off a vote on their California constitutional amendment or any other proposal until Congress has decided the fate of H.R. 5502. That would give the operators a better idea of how to proceed.

The pressure for a viable proposition is growing in the Golden State. There is already a competing amendment proposal from the Legislature that is far less friendly to the tribes’ desires.

That may make it difficult for the tribes to wait on H.R. 5502 results before making changes to their proposal. In California, a constitutional amendment requires a voter referendum. In order to get the measure on the ballot, it would have to be approved by the governor and state Legislature in late spring.

It’s easy to understand why the change that would come from H.R. 5502 becoming law would be a big win for California’s tribal casinos. All those interested in the future of legal sports betting in the Golden State should be tracking the progress of this bill.

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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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