Stakeholders firmed up their stances on new language to legalize California sports betting ahead of Tuesday’s committee hearing.
Given top priority to offer retail and mobile sports betting, Indian tribes oppose the bill. Locked out of California sports betting all together, cardrooms support the legislative effort.
On Thursday, Sen. Bill Dodd and Assemblyman Adam Gray released an amendment to their sports betting referendum bills. They are seeking to put a constitutional amendment on the ballot in November legalizing sports betting at Indian casinos and horse racing tracks.
Dodd’s SCA 6 will get a hearing in the Senate Governmental Organization Committee at 1:30 p.m. Tuesday.
Why tribes oppose CA sports betting bill
Tribes sent a letter to lawmakers Monday expressing that they are not divided in their opposition to the legislative effort.
The letter addressed to the two committee chairmen comes from 15 individual tribes and two tribal associations. One of those organizations, the California Nations Indian Gaming Association, represents 34 tribes across the state.
The letter gives a preview of the kind of response the amendment will get from tribal representatives at the hearing.
“We cannot view your SCA 6 any other way than yet another betrayal of an agreement between the State of California and Indian tribes.”
The letter and conversations with tribal representatives reveal three main points of opposition:
Allowing cardrooms to continue designated player games
The amendment excludes cardrooms from participating in CA sports betting. But to appease this major gambling segment in California, lawmakers put something into the bill for them.
The language affirms the legality of a system cardrooms use to have third-party designated players offer a card game much like Nevada-style blackjack.
Tribes have long sought to stop cardrooms from offering the games. Tribal representatives say codifying their legality would repeal the exclusive gaming rights voters gave them in 2000.
“Giving them a green light for the criminal activity that has occurred is not a trade-off for us,” added David Quintana, a lobbyist who represents three large CA tribes including the Viejas Band of Kumeyaay Indians.
Permitting sports betting to occur online
A coalition of 18 Indian tribes filed a ballot initiative to legalize sports betting solely on the premises of tribal casinos and racetracks.
The initiative ran into a roadblock in the signature gathering process because of the coronavirus. Speaking for the coalition, Jacob Mejia warned to expect a lawsuit to extend the June 25 deadline for making the ballot.
In the letter, the tribes indicate that their public opinion research shows voters oppose online wagering. Mejia previously told LSR that a poll showed only 29% of Californians support mobile wagering.
Talking to LSR on Thursday, Dodd said the state won’t be able to raise the amount of money needed to help with budget cuts in California without mobile betting because the activity makes up more than 85% of the handle in other states.
Lawmakers not working with tribes on sports betting
The tribes opted to push for their own sports betting initiative rather than work with the legislature on a referendum. Tribes still didn’t appreciate being shut out on the legislative amendment before its release.
Quintana insists that because the lawmakers did not work with them to come up with a bill previously, there is no chance for the legislature to gain tribal support.
“There’s not enough time left to come up with an honest brokering of what would work,” Quintana said. “Instead of trying to drop this on tribes at the 11th hour, what the author might have done is sit down with tribes a couple months ago and started talking about this.”
Quintana added that the state isn’t the only one suffering from the economic shutdown resulting from the coronavirus.
“This is not a compromise,” he said. “This is a sucker punch. Tribes are just trying to recover. Their casinos were devastated by COVID-19 and that’s the only economic generator we have on those reservations.
“We’re finally ready to open up in some manner and then, bam, he sucker punches us with this thing.”
Cardrooms value assurance over sports bets
The California Gaming Association, which represents 49 cardrooms in the state, sent a letter in support to Dodd and Gray.
In the letter, executive director Joe Patterson says the bill “will benefit all Californians while protecting irreplaceable local government revenue generated by lawful cardroom activity.”
Cardroom leaders have lamented that the tribes are trying to bully them out of existence.
What is motivating cardrooms?
Essentially, cardrooms want final clarification that they can continue doing what they’ve been doing for more than two decades, even if it means that players sitting at their tables could be betting on tribal sports wagering apps between hands.
The letter indicates that the measure will confirm that the CA cardroom industry will continue to generate more than $5.6 billion in revenue, employing more than 30,000 people and contributing more than $500 million of tax revenue.
“In addition to the thoughtful approach to sports wagering, your measures will reassert the legality of our games as California courts have repeatedly done in the past and ensure the continued safe, legal offering of the popular games our industry has offered for more than two decades without harm to or complaint from the public.”
What California stakeholder sides mean
Dodd said SCA 6 would have some support from small tribes. Quintana refuted that statement.
“I have yet to meet a tribe that supports SCA 6,” Quintana said. “That is just patently untrue. I cannot remember something that has brought the tribes together to oppose something faster than this bill.”
It looks like lawmakers might have to push for the legislation to pass without tribal support. It’s a difficult task to pass a bill the leading industry stakeholder opposes when constitutional amendments require a two-thirds vote.
Dodd told LSR there is support from many, including professional sports leagues. Cardrooms bring support from their host cities, many of which serve disadvantaged communities, because they depend on cardroom tax revenues for health, housing, and emergency services.
He added that legislators will have difficulty explaining to constituents why they didn’t go after revenue to limit cuts. The state is dealing with a $54 billion budget deficit.
Tribes prepared to carry fight to ballot
June 25 is the last day for legislative measures to qualify for the Nov. 3 general election ballot. However, the legislature breaks for summer recess on June 19.
If lawmakers do get their plan passed by the legislature, tribal representatives express that won’t be the end of their opposition.
“In the event your bill makes it to the ballot, we will work tirelessly to ensure voters defeat the measure in order to protect our ability to continue funding healthcare, education, public safety, and critical tribally funded programs.”