Tribes Object Cardroom Language in Bills That Could Open Door to Sports Betting in Calif.

Pechanga Resort Casino – looking toward The Cove pool complex and hotel towers. Pechanga Resort Casino will open incrementally and under limited conditions, starting June 1st. 

California is lauded as the untapped “holy grail of sports betting markets, and not just because of its sheer size,” said Dustin Gouker, chief analyst for PlayCA.com. “…Because it has the potential to be the largest legal sports betting market in the U.S., ultimately it represents a seismic shift in the industry.”

The market has the potential to generate more than $30 billion in wagers annually, according to projections from PlayCA.com, which analyzes legalized gambling in California. Those wagers would generate some $2 billion in operator revenue and $300 million in state taxes each year. 

But not everyone is on board with recent legislative proposals for online and retail sports betting in the Golden State — and that includes Tribes. Proposed legislation often treads on the sovereign exclusivity rights of California-based Tribes, who have their own land-based betting proposal that they hope to get on November’s ballot.

Of particular relevance is new language in bills introduced by Sen. Bill Dodd (D-Napa) and Assemblyman Adam Gray (D-Merced) that would amend the state constitution to: 

  • Authorize retail and online sports betting at the state’s Tribal casinos and racetracks if approved by voters, but not at the state’s cardrooms. 
  • Set a tax rate of 10% on gross revenue for in-person wagering and a 15% tax for mobile or online wagering. 
  • Impose taxes on the platform operators rather than directly by the Tribes, to avoid sovereignty issues.
  • But here’s where the point-of-contention arises for Tribes: the bills propose allowing state cardrooms to offer ‘player-banked’ games even though California Tribes hold a monopoly on ‘house-banked’ card games like blackjack and baccarat. The legislation seeks to appease Tribes by allowing them to add non-card casino games like craps and roulette.

The California Native Indian Gaming Association (CNIGA) issued a statement expressing vehement opposition to including California cardrooms in the expansion of gaming in any shape or fashion. 

Statement from CNIGA Chairman James Siva on Sen. Dodd’s Sports Betting Language

“After initial review of Senator Dodd’s recently updated language to amend the State Constitution to allow  sports wagering, we have some concerns. First , while on its face this language seeks to amend the constitution to legalize and regulate sports wagering in California, this language also provides California’s commercial card room industry with a massive expansion of games, by legalizing the use of proposition players to serve as the bank, a notion that has been rejected by California’s voters and fundamentally changes the legal structure of California’s peer-to-peer gaming industry.

While we appreciate Senator Dodd’s attempt to address sports wagering, we are vehemently opposed to including an expansion of gaming to a segment of the gaming industry that has proved, for decades, to be unwilling to follow the rules and regulations that guarantee a fair and safe gambling environment, and that comply with federal laws designed to stop money laundering.

We urge Senator Dodd to remove the provisions relating to California Cardrooms until that industry exhibits consistent behavior that proves that they are both willing and able to operate within the confines of the laws and regulations that currently exist. 

We understand the need for the state to find additional revenue during such a dire time, although by the time this measure actually could be implemented, we would hope that the current pandemic will have long since subsided. Tribal governmental budgets have also seen extraordinary losses due to the closure of our casinos that provide the majority of governmental revenue amid the COVID-19 pandemic.  However, we must not ignore one disaster in order to remedy another. We must move carefully and thoughtfully. As valued partners with the state of California, our tribal governments would welcome the opportunity to provide input on a significant proposed change in the gambling policy of California, and look forward to more open and meaningful discussions.”

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