There is a chance Oklahoma sports betting could be legal in the next few years, but it likely will not come through simple negotiation because of a tenuous relationship between the state’s tribes and Gov. Kevin Stitt.
An expansion of gaming in Oklahoma requires a three-way agreement between the governor, legislature and tribes. At the National Council of Legislators from Gaming States summer conference in Denver last month, Oklahoma Indian Gaming Association chairman Matthew Morgan told LSR the tribes and legislature are largely having good-faith conversations for legal OK sports betting, and hinted at growing frustration with their relationship with Stitt.
“Ask the governor,” Morgan said bluntly in response to how likely legal sports betting gets done in the next few years.
Earlier in July, five powerful Oklahoma tribes came together for a joint resolution stating Stitt has not negotiated in good faith on multiple issues. It continued that his efforts threaten “to undo decades of work and damage tribal-state cooperation for generations to come.”
Stitt’s burned bridge in Oklahoma?
Stitt has been a proponent of legal sports betting for several years, and said he would sign any legislation that is fair and allows the state to maximize its revenue potential. The governor’s relationship with many of the tribes, however, is on shaky ground after he tried to legalize sports betting in 2020 through two updated tribal compacts, which also included a stipulation to allow non-tribal sports betting locations.
The 29 tribes that make up the OIGA all turned down the offer to legalize sports betting in the proposed compacts. Ultimately, Oklahoma courts denied the compacts after legislators sued.
Stitt was under the impression all of the state’s tribal compacts were set to expire in 2020, while the tribes believed they were all set for an extension. A 2020 US District Court ruling determined they automatically renewed for another 15 years.
Tribal conversations needed for Oklahoma sports betting
It is not just the tribes that want more earnest conversations with the governor. Sen. Bill Coleman told KFOR-TV the governor and tribes need to figure out their issues before sports betting legislation can advance.
“I continue to believe that sports betting would be a good thing for our state,” Coleman told KFOR-TV. “The majority of my constituents who have reached out were overwhelmingly supportive of sports betting. However, it became clear during the process that there are too many unresolved issues that ultimately killed it this year.
“This legislation will take more than just passing a bill through the legislature. When dealing with our tribal partners, compacting, and all the nuances that come with exclusivity and future gaming negotiations, we must get the governor in the same room with tribal leaders to build upon the conversation started this year by the legislature.”
Along with uneven terms, an industry source told LSR that Stitt wanted to include the Oklahoma City Thunder in sports betting, an unpopular addition for the tribes.
Legislators also growing impatient with Stitt
The Associated Press reported last month that legislators from Stitt’s Republican party are considering pushing the governor out of tribal negotiations. Senate President Pro Tempore Greg Treat told the AP the legislature would give Stitt one more year for negotiations before taking over compact dealings.
“Even (former) President Trump has mentioned he doesn’t know why the governor has such animosity toward the tribes,” Treat told the AP. “It’s nonsensical.”
Oklahoma Attorney General Gentner Drummond has also said the state’s tribal relationships have greatly deteriorated because of Stitt’s actions.
What happened in Oklahoma this year?
Following an OK sports betting bill falling short in the legislature in April, the Indian Gaming Association held a discussion in May on the state’s situation. The discussion featured IGA Executive Director Jason Giles, IGA Conference Chairman Victor Rocha and JR Mathews, a former chairman of Oklahoma’s Quapaw Tribe.
“The tribes are carrying the economic burden for the state and the state can’t appreciate it,” said Giles, who is a member of the Muscogee (Creek) Nation of Oklahoma. “They just want more and more. The governor is inflicting damage on tribal-state relations in his second term, but the (Republican) party doesn’t seem to back him up on a lot of these issues with the tribes.
“One of the biggest bargaining chips he has is telling tribes he will open up commercial sports betting here, sticking it to tribes and infringing upon their exclusivity. That’s not happening.”
Sports betting dead in Oklahoma, for now
The IGA discussion acknowledged nearby states including Kansas and Arkansas are quickly legalizing sports betting, and the state and its tribes need to keep pace. Still, participants were pessimistic that tribes, who hold gaming exclusivity in Oklahoma, can overcome poor relations with Stitt.
“With the current state of leadership, I don’t see it happening anytime soon with all the tribes,” Mathews said, adding Stitt has four more years in office.
The bill in the 2023 session, HB 1027, would have expanded tribal gaming to include sports betting, but it would have required at least four tribes to renegotiate their compacts. While it easily passed the House, 66-26, the Senate failed to advance it out of committee, recognizing the poor discussions between tribes and Stitt.
Sports betting a ‘trojan horse‘?
Mathews called the legislation the governor’s “trojan horse” as an attempt to pull more money out of the tribes. He said Stitt wants to push the tax rate as high as 25% on tribal gaming.
Under the existing compacts, the tribal casinos paid almost $200 million to Oklahoma in 2022. In the compacts, tribes pay:
- 4% on the first $10 million
- 5% on the next $10 million
- 6% on anything beyond $20 million
The steep increase Stitt demands is likely to keep many Oklahoma tribes away from the negotiating table, according to May’s IGA discussion. Still, Mathews said that should similar sports betting legislation as this year’s pass in future years, four tribes could end up signing new compacts leading to legal OK sports betting.
Stitt plays it cool after failure
The IGA discussion detailed Stitt’s contentious relationship with the tribes. They also outlined the political landscape that keeps many lawmakers in the state cautious to follow his lead.
Stitt’s fellow Republicans are wary, as many districts have large tribal populations, according to Mathews. After the bill failed this year, Stitt told NEWS9 he is hopeful for a strong effort next year.
“I’ve studied what other states have done, and there’s 35 other states that have a sports betting system, and so we can see exactly how that’s set up,” Stitt told the news station. “Let’s just get this across the finish line. Maybe we’ll come in and work on that next year, but I certainly want us to get something across the finish line that’s fair for Oklahomans.
“I wouldn’t say I’m disappointed because the bill that was proposed by one of the members wasn’t exactly the one that was transparent and fair, not thought through enough, not clear enough.”
