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US Sports Betting Update – Two California tribes throw their weight behind online betting proposal

US Sports Betting Update – Two California tribes throw their weight behind online betting proposal

Efforts to legalize online sports betting in California gained a significant boost when two Native American tribes backed the newly qualified ballot measure. A group created by the country’s largest sportsbooks gathered 1.6 million signatures for their proposal earlier this year, meaning it will feature on the November ballot. Californians will be able to vote on whether online sports betting should be permitted, and two prominent tribes have gone public in support of the plans.

That is significant, because the online sportsbooks have faced fierce opposition from some of the other tribes in the Golden State. The San Manuel Band of Mission Indians, the Rincon Band of Luisueño Indians and the Wilton Rancheria joined forces to form the Californians for Tribal Sovereignty and Safe Gaming Committee. Their stated goal is to oppose the initiative backed by Bally’s, BetMGM, DraftKings, Fanatics, FanDuel, Penn National and Wynn to legalize online sports betting in California. 

They have come up with a rival proposal, which would only permit retail sports betting at casinos on tribal lands in California and at racetracks. Both measures are set to go on the ballot this November. Brandon Castillo, a campaign strategist for the tribes, has declared that both ballot measures cannot co-exist. If Californians vote “yes” on both ballots, the tribes plan to take the matter to court.

“An Opportunity to Protect Our Sovereignty”

However, the Big Valley Band of Pomo Indians and the Middletown Rancheria of Pomo Indians have now decided to back the initiative led by the online sportsbooks. The legislation is known as the California Solutions to Homelessness and Mental Health Support Act, as it proposes that 85% of the tax revenue generated from online sports betting will be used to support mental health treatment and eradicate homelessness in the state. 

“We’re supporting the Solutions Act because it gives us an opportunity to protect our sovereignty and also create opportunities for economic wealth for the next seven generations for our tribe,” said Jose “Moke” Simon, chair of the Middletown Rancheria of Pomo Indians. “It also helps the state of California deal with some of the biggest problems that it has here, that is affecting every community, which is homelessness and mental health issues.”

A $300m Campaign Battle Looms

Simon will now star in a new online ad for the proposal. Analysts estimate that the rival groups will spend a combined $300 million in trying to drum up support for their proposals. That would make it California’s most expensive ballot battle ever. Californians can expect to be bombarded with contrasting messages from each faction over the next four months, with each side attacking the other and trying to convince voters to reject the alternative measure.

Campaign strategists warn that this could ultimately result in voters saying “no” to both. When there are two similar, competing measures on a ballot, the chances of either passing are generally viewed as slim. To make matters worse, a separate tribal coalition – which wants to see online 

sports betting legalized under a different proposal in 2024 – has been attacking the operator-backed initiative for months too via its own ads. Yet none of the warring factions will back down.

At stake is control over what will become the country’s largest sports betting market. California is the most populous state, with 40 million residents and another 40 million in annual tourists. Its GDP is larger than New York and Florida combined. It also has four NFL teams, four NBA teams, five MLB teams, three NHL franchises, three MLS clubs and some of the biggest college teams in the business. Analysts project revenue of at least $3 billion per year from an online sports betting market in California. It is a major prize, so the backing of two prominent tribes represents a shot in the arm for the online sportsbooks.

“Life-Changing for Our People”

 Philip Gomez, chair of the Big Valley Band of Pomo Indians, said: “The Solutions Act would be life-changing for our people. For too long, rural and economically disadvantaged Tribes like ours have struggled to provide for our people. This measure would provide us with economic opportunities to fortify our Tribe’s future for generations to come.”

The online sports betting proposal from BetMGM, FanDuel, DraftKings et al would require sportsbooks to partner with tribes to launch in the Golden State. While 85% of the tax revenue would go towards mental health and homelessness agencies, the remaining would be allocated to state tribes that are not affiliated with the gambling industry.

Simon warned Californians not to believe the “false attacks” from the two tribal coalitions opposing the operator-based plan. “Don’t believe them,” he said. “The Solutions Act protects Tribal sovereignty and will allow every Tribe – not just those with big casinos close to big cities – a chance to directly benefit from online sports betting in California,” added Simon. “The measure puts Tribes firmly in control of online sports betting in California. By taxing and regulating online sports betting for adults 21 and over, we can protect tribal sovereignty and finally do something about homelessness in California. Vote yes on the Solutions Act.”

Tribal Coalition Hits Back

Kathy Fairbanks, spokesperson for the Coalition for Safe, Responsible Gaming, which opposes the operator-backed measure, said: “More than 60 tribes (and growing) are opposed to the Corporate Online Gambling Proposition, along with the main trade associations for tribes (CNIGA and TASIN). Tribes oppose it because it is a direct attack on Indian gaming and tribal self-sufficiency. Under their measure, the corporate operators take total control of the market — sending 90% of revenues out of state — while hurting tribes and exposing millions of kids to online gambling. The vast, vast majority [of tribes] are opposed to the (online) measure, and we will make sure that voters are aware of that.”

Brandt Iden, a former Republican Michigan state representative who now heads up government affairs at data provider Sportradar, said that voters will be faced with a blizzard of competing ads in the months ahead. Yet he added that, for consumers, it essentially boils down to a simple decision: retail only sports betting vs. mobile wagering. “That's what this is going to come down to for consumers: do I need to walk into a sports book to place a wager, or can I do it from a mobile device anywhere in the state?”

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