The Social Gaming Leadership Alliance is asking California Gov. Gavin Newsom to veto a bill that would ban sweepstakes casinos in the state.
AB 831 passed the California legislature on the final day of its session. Newsom has until Oct. 12 to act on the bill before it becomes law without his signature.
The SGLA, which recently combined with the Social and Promotional Gaming Association according to Gambling Insider, warned that California would lose $1 billion of economic impact annually should Newsom sign the bill to shutter sweepstakes casinos in the state.
Is veto likely?
Newsom has not suggested he will act one way or the other on the bill, but if the way AB 831 sailed through the votes in both chambers of the California legislature is any indication of how he may act, then the SGLA is out of luck.
AB 831 did not receive a single no vote in the legislature, either on the floor or in committee.
The biggest reason for the overwhelming legislative support is that the California Nations Indian Gaming Association supported the bill. CNIGA suggested the sweepstakes casinos went against their tribal sovereignty and exclusive right to offer casino gambling in the state of California.
Supporting tribes and keeping the promise of exclusive gaming rights was a common reason given by legislators for their yes votes on the bill.
Last chance for sweepstakes in CA
Newsom was asked to veto the bill and position California as a leader in “next-generation gaming technology” by SGLA Executive Director Jeff Duncan in a letter on Tuesday.
“It is incredibly disappointing that the California Assembly decided to pass AB 831,” Duncan said. “Beyond the fact that this bill would worsen economic disparities among California tribes, put California to the back of the line in terms of digital innovation in this space, and take away a popular form of entertainment for residents, it will immediately strip $1 billion out of the state’s economy.
“We implore Governor Newsom to veto this bill and instead open the door for online social games to support economically disadvantaged tribal nations and the state’s economy while positioning California as a leader in next-generation gaming technology.”
The $1 billion in economic impact estimate comes from a study by gaming consultancy Eilers & Krejcik:
- $739.1 million spent by sweepstakes to advertise through California-based companies
- $208 million in non-sweepstakes gaming household earnings through jobs at companies that work with the industry.
- $35.8 million in processing fees paid annually to California-based companies
- $34.2 million in cloud hosting costs paid to California-based data centers.
