Prop 27 is California’s sports betting initiative that would allow private sportsbook companies to offer mobile sports betting. Gaming tribes supporting Prop 26 oppose commercial control of sports betting in California. Instead, the tribal initiative would only allow in-person sports betting at tribal casinos.
So, it may surprise some to see some tribes support Prop 27.
Three tribes support Prop 27:
- Big Valley Band of Pomo Indians
- Middletown Rancheria of Pomo Indians
- Santa Rosa Rancheria Tachi Yokut Tribe
“Prop. 27 will provide us with economic opportunity to fortify our Tribe’s future for generations and protect Tribal sovereignty,” said Leo Sisco, Chairman of the Santa Rosa Rancheria Tachi Yokut Tribe, in a press release. “And it is the only measure that will deliver hundreds of millions of dollars each year to help solve homelessness and address mental health in California.”
Prop 27 would create a Tribal Economic Development Account and give 15% of state tax revenue from sports betting to that account, and 85% to homelessness programs. The Tribal Economic Development Account funds would be for California tribes that are not involved with gambling. This is undoubtedly designed to split tribal support for Prop 26, the tribal gaming initiative.
But it also creates a new revenue stream for tribes who may need it. Most California tribes don’t make enough money from gambling to support an independent economy. Many tribes receive funding from the Bureau of Indian Affairs to help with housing payments. Others depend on government contracts for revenue, and all of them would benefit from reforms encouraging private investment on tribal lands.
Giving tribes a piece of online sports betting revenue is an important reason why the three tribes above have backed Prop 27. This new revenue stream could lead other tribes to embrace the online sports betting initiative, too.
How Tribal Support for Prop 27 Could Change California Midterms
California’s dueling sports betting initiatives are as much a battle between online and retail sports betting as it is between commercial and tribal control. The commercial sportsbooks have attempted to balance California interests by including non-gaming tribes in the sports betting industry.
Prop 27 already requires sportsbooks to partner with licensed tribes to offer sports betting. However, it also requires tribes to submit to California sports betting regulations. It would require a sacrifice from California tribes, but they wouldn’t be left out of sports betting altogether.
Under Prop 26, non-gaming tribes would still get some sports betting revenue. Current gambling law provides quarterly payouts to qualifying tribes that max out at $1.1 million annually. In other markets, online sports betting is far more lucrative than retail sports betting. So, California policymakers and stakeholders could increase those contributions with Prop 27.
Although the terms of the Tribal Economic Development Fund wouldn’t be hashed out until after the midterms, it would add gambling revenue to non-gambling tribes and include current gambling tribes in online gambling.
Even if the Prop 27 terms favor commercial sportsbooks, tribal casinos and non-gaming tribes would still have some inclusion in the new online sports betting industry. Tribal support for Prop 27 at least has a case. Whether that case convinces more tribes before the midterms remains to be seen.