Controversial California sports betting ballot measure amended following tribal outcry

A pair of controversial ballot initiatives seeking to legalize sports betting in California have been amended and resubmitted to the California Attorney General’s Office after in-state tribal operators expressed their opposition.

The Tribal Gaming Protection Act and the Sports Wagering Regulation and Tribal Gaming Protection Act, initially submitted by Eagle 1 Acquisition Co. CEO Kasey Thompson on October 27, would, if passed, confer exclusivity on sports betting in the Golden State to California’s tribal gaming operators.

However, in the months following the submission, tribal groups in the state, most notably the California Nations Indian Gaming Association which has very publicly opposed the initiatives, branded the initiatives “abhorrent” and an attempt to sow division amongst tribal operators.

A mandatory comment period, required under Californian law, expired on November 27, with the tribal operators doubling down on their opposition by submitting letters of comment to the Attorney General’s Office.

The most noteworthy one came in the form of a joint letter from the San Manuel Band of Mission Indians, Rincon Band of Luiseño Indians, and Wilton Rancheria, which criticized the ballot measures tabled.

Central to these initiatives is a provision to work with tribes in placing a major portion of the current illegal offshore sports betting market operating in the state under tribal control, something which the trio expressed their vehement opposition to.

In response to this, these provisions have been removed from the ballot initiatives and the percentage of operator revenue going to the Revenue Sharing Trust Fund (RSTF), a fund put in place to funnel revenues back to the tribes in return for their exclusivity, has increased from 15% to 25%.

This amendment comes at the expense of a 10% slice earmarked for homeless and mental health causes.

In addition, a two-year limit has been introduced to the in-person sign-up requirement relating to online sportsbook accounts. This means customers will not be required to go to a retail casino to open an online account after this period,  allowing individuals to sign up for mobile apps within 10 miles of tribal casinos.

Amendments also increase the time period at which promotional credits can be used by operators to offset taxation to five years, starting at 15% in the first year of operation and decreasing by 3% every year until year five, when no promotional credits will be available.

Lastly, the amended initiatives would see Californian online sports betting start no earlier than July 1, 2025.

“We took a proposal that had the support of more than 70 tribes and was one of the most tribal-focused propositions ever, made amendments based on tribal and regulator feedback and updated it for today’s legal landscape,” Eagle1 Acquisitions Corp partner Kasey Thompson said.

“What we are trying to do is create something that works for everyone. Tribal support is paramount to the success of this effort, and we will not put it on the ballot without approval from a majority of the tribes.”

Eagle1 partner Reeve Collins added: “we removed language we were told did not work for the tribes and for the first time have created something inclusive for all – the tribes, land-based casinos, regulators, out-of-state operators and the people of California. This is a forward-thinking and tribal-centric proposition that finally paves the way for sports betting in California.”

Both measures can now commence a signature gathering, which provisionally is due to end within four months, however the state does allow for up to six months for signature collection.

To qualify to appear on the November 5, 2024 general election ballot, the initiatives proponents will be required to collect 874,461 valid signatures from Californians over the allotted period.