Local tribes on opposing sides in fight over sports betting
Jose “Moke” Simon’s beard is more salt than pepper these days, but Simon, chairperson of the Middletown Rancheria of Pomo Indians since 1997, still cuts an imposing figure.
On Wednesday, the former college football lineman looked resolute as he sat before a microphone in a joint gathering of the California State Senate and Assembly organization committees in Sacramento.
The purpose of the hearing was to present information on state ballot propositions 26 and 27, competing initiatives that would legalize sports wagering in California, in different ways, if passed in November.
Around half of California’s 109 federally recognized tribes support Proposition 26, which would legalize sports betting, but only in Indian casinos and a handful of year-round horse racing tracks.
But Simon spoke in favor of the competing measure, Prop 27, which would pave the way for virtually unlimited online sports wagering in this state.
Simon’s stance puts him in stark opposition to his fellow tribes, though he downplayed it Wednesday.
“I heard that today: ‘division.’ There is no division,” Simon told the senators and assembly members. “This is just an opportunity for one tribe to make a decision — a sovereign decision — on how they’re going to move their people forward. … You know, it’s not always easy to do the right thing for your people. But when your people ask you to act, then you go to war, or you give your life if that’s what is needed.”
Watching recent advertisements on either side of the issue, the word “division” seems accurate.
“Who’s attacking Prop 27? Wealthy casino tribes who want all the money for themselves,” a narrator says in a Yes on 27 commercial released in early August.
Within hours of that salvo, the powerful tribes that form the backbone of No on 27 — including the Federated Indians of Graton Rancheria, who own the resort and casino in Rohnert Park — were calling the ad “shameful and despicable.”
The rancor goes well beyond words. The competing campaigns together raised more than $255 million as of June 30, according to Ballotpedia, a nonprofit, nonpartisan online “political encyclopedia.” That makes sports wagering the most expensive ballot issue in California history, eclipsing the nearly $225 million raised in the fight over Prop 22, which passed in 2020 and exempted app-based ride companies like Uber and Lyft from providing drivers with employee benefits.
The Prop 27 campaign is funded largely by online gambling companies like DraftKings, FanDuel and BetMGM, which would be allowed to sign an agreement with a recognized tribe to offer those services in California, an arrangement used in other states, like Washington. The gaming companies are aligned with the state’s 83 card rooms, which are unaffiliated with tribal casinos and would be iced out of the Prop 26 framework.
It isn’t hard to understand why the spending has spiraled. The financial stakes are huge.
Bettors wagered more than $143 billion on sports in the 25 states, plus the District of Columbia, where that wagering was legal in 2021, according to the website sportshandle.com.
“There’s so much as stake,” said State Sen. Bill Dodd, a Democrat based in Napa and chairperson of the Senate Governmental Organization Committee.
Dodd proposed legislation in 2020 that would legalize sports wagering in California. He ultimately removed it from consideration, partly in response to resistance from gaming tribes, but said he considers it superior to either of this year’s propositions.
The profits from sports wagering are potentially huge, and a percentage of that money would pour into state coffers.
California state revenues could reach “the tens of millions of dollars annually” if Prop 26, the casino sports wagering measure, passes, Anita Lee, principal fiscal and policy analyst for the Legislative Analyst’s Office, told the joint committee Wednesday.
Prop 27, the online measure, would bring in “possibly in the hundreds of millions of dollars,” Lee said. It would also require tribes to pay a $10 million fee for a five-year license, then another $1 million each time it’s renewed. A licensed company such as FanDuel would have to fork over $100 million when approved and $10 million for each renewal.
“In my proposal, we knew the tax revenue would have meant close the three-quarters of a billion dollars for the state,” Dodd said in a phone interview.
The public beneficiaries are worthy causes. The fund established by Prop 26 would target K-12 educational funding. Prop 27’s fund would focus on gambling addiction and homelessness.