California Tribes Present New Ballot Initiative with Hopes of Exclusive Control over Sports Betting

The prospect of the legal sports betting market in California is heating up. Still, with several interested parties seeking different ballot measures to be presented in 2022, it’s far from a simple path forward for the state. Over the weekend, several tribes brought forward their proposal of the California Tribal Government Mobile & Retail Sports Wagering Act of 2022. This act would give tribes complete control over sports betting while blocking card rooms, commercial giants, sports franchises, and other parties. The proposed ballot initiative would be the fourth proposal California voters could see on their ballot in 2022.

What Does the Proposed Initiative Entail?

The Rincon Band of Luiseno Indians and the Federated Indians of the Graton Rancheria and Wilton Rancheria tribes sent a letter to all federally-recognized tribes in California proposing their plan for sports betting on Friday. The letter included the tribes’ hope to consolidate control over in-person and online sports betting to leave exclusivity over the gambling industry in the hands of the tribes. On the same day, 43 tribes published a letter opposing initiative proposals for sports betting from commercial operators and local card rooms. The tribes plan to file the measure with the Secretary of State this week.

Under this proposal, residents and visitors could make online sports bets from anywhere in California. Still, they would need to be processed through servers located on Indian lands and owned and operated by the tribes. September 1, 2023, was listed as the earliest possible launch date for sports betting. The tribes expressed their concern that the existing “DraftKings Measure” would threaten the “existence of Indian gaming as we know it” as it would see the tribes “lose their exclusivity to class III gaming in California.”

Status of Existing Initiatives

As of now, only one of the four initiatives – the California Sports Wagering Regulation and Unlawful Gambling Enforcement Act – has been approved for the November 2022 California ballot. This proposal was presented by the Pechanga Band of Luiseno Indians and would allow for retail sports betting at California’s tribal casinos and four horse racetracks. It does not include any mention of plans for digital sports betting offerings.

In addition to the Pechanga proposal, two other parties have proposed initiatives to be considered for the 2022 ballot. Proposed ballot measures must be approved by June 2022 to be considered on the November 2022 ballot, but it can take over two months to get a title and summary from the attorney general’s office, so time is of the essence for any parties attempting to file new initiatives.

Commercial Sports Betting Campaign

The ballot initiative that seems to have generated the most steam in California is the California Solutions to Homelessness and Mental Health Support Act which promises to raise hundreds of millions of dollars annually to address those critical issues. The initiative calls for 85% of total revenue to homelessness and mental health, with 15% going to tribal communities. This campaign is backed by seven operators, including major commercial sportsbooks DraftKings, FanDuel, and BetMGM, the leaders in the industry in the United States. These national sportsbooks have hundreds of millions of dollars in their arsenal, making them a formidable foe for the tribes looking to challenge them.

When California does legalize sports betting, it will become the largest sports betting market in the country with almost 40 million people, about 12% of the total United States population. With so many interested parties and competing interests to sort through, we aren’t bullish on a potential sports betting launch in the near future. However, the massive revenue potential is lighting a fire under the state’s tribes, card rooms, and national sportsbooks to push along their respective initiatives. We expect there to be significant developments in the coming months.