California lawmakers are taking another shot at online sweepstakes casinos that blur the lines with real-money gambling.
Last week, a bill was introduced in the California State Legislature that was actually an amended version of a previous bill that passed both chambers in the statehouse before being vacated.
Assemblymember Avelino Valencia’s (D-Anaheim) new legislation, Assembly Bill 831, goes well beyond the earlier legislation by outright banning sweepstakes casinos from operating in the state.
Valencia said the bill is meant to protect tribal sovereignty.
“We cannot look the other way while these platforms exploit legal ‘gray’ areas. These operations undermine the voter-approved framework that affirms tribal governments’ sovereign right to conduct gaming in California. AB 831 strengthens that framework and ensures gaming in California remains fair and accountable.”
AB 831 takes a different tact
Previous legislation began as a simple update, giving California lawmakers more breathing room to review tribal-state agreements.
After passing both houses of the Legislature, that measure was iced by the Senate earlier this month.
The new legislation isn’t about tribal compacts anymore. It’s a full-frontal attack on online sweepstakes casinos operating in California. It aims to shut down any sweeps using “dual-currency systems.”
What’s more, the bill targets everyone involved in a sweepstakes casino, from the ones who handle the money to those providing the platforms.
Victor Rocha, conference chairman of the Indian Gaming Association (IGA), applauded the measure.
“California, with this legislation, I think this is a good start that will give a role model to other states and other tribes. … There are 34 states plus DC already on it, and we (California) started raising this in October, so look how far it has come since then. I think this goes to show you that when people are awake, when people are focused, you can get action. … And this is just the beginning.”
Proponents expect to get AB 831 signed into law before Sept. 12, when this legislative session ends.
Lines drawn
The Social and Promotional Games Association (SPGA) is loudly protesting the bill, claiming it will cost jobs.
The IGA balks at that argument. It points out that because these businesses aren’t paying taxes, any loss of jobs won’t have a major impact on the state.
The SPGA said Monday that more debate is needed on AB 831.
“The SPGA is deeply troubled by California lawmakers’ decision to attempt a backroom ban on promotional sweepstakes through a controversial ‘gut and amend’ maneuver hours before a legislative deadline.
“We urge Gov. Newsom and other leaders to reject this rushed and hypocritical approach and instead pursue a transparent, fact-based dialogue about the future of legal digital innovation in California.”
The hands of California tribal gaming casinos have been tied to legally challenge sweeps operators because federal laws limit the penalties tribal courts can impose on non-tribal citizens.
This issue mirrors the ongoing battle with cardrooms in the state. That contentious fight resulted in Senate Bill 549, which would let tribes directly sue cardroom operators. The legislation awaits Gov. Gavin Newsome’s signature to become law.
