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North Bay tribes throw support behind state measure to allow sports betting at tribal casinos

North Bay tribes are throwing their support behind a state initiative to legalize sports betting at casinos on native lands, setting up a potentially expensive campaign battle pitting California tribes against cardrooms and online gambling companies.

The measure qualified last month for the November 2022 ballot. If approved, it would restrict sports betting to tribal casinos, as well as the state’s four licensed horse tracks. It would also allow roulette and dice games, including craps, at tribal casinos.

“It moves things from a cardroom and slot machine atmosphere, to a place that is a full-fledged Vegas-like entity,” said David McCuan, chair of the political science department at Sonoma State University. “Now you don’t have to go to Vegas for March Madness — now you can have March Madness right in the Friendly City,” he said referring to Rohnert Park.

The Federated Indians of Graton Rancheria, which owns the Bay Area’s largest casino just outside Rohnert Park, has over the past year-and-a-half contributed over $1.7 million to the campaign backing the measure, making it the effort’s third largest donor, according to campaign finance records. California tribes have poured in over $11.5 million in total.

The Dry Creek Rancheria Band of Pomo Indians, owner of the River Rock Casino near Geyserville, also supports the measure, according to casino Chief Executive Sue Ascanio. The tribe has not contributed money to the campaign, but may do so in the future, Ascanio said.

Tribes argue that they should have majority control over sports betting in the state since they are best equipped to manage the potentially lucrative industry as it emerges from the shadows.

“Because we are so highly regulated and have doing it for so long, it really is part of our world,” Ascanio said. “...The bottom line is this already happening illegally and it’s not benefiting the state.”

The initiative would place a 10% tax on sports wagering gaming revenues at horse tracks, while tribal casinos would pay a portion of their revenue to at least cover regulatory costs. The state estimates it could yield tens of millions in annual revenue under the ballot measure.

Graton Tribal Chairman Greg Sarris, through his representatives, declined to comment on the tribe’s support of the initiative.

The Lytton Band of Pomo Indians, which owns property near Healdsburg and sovereign land outside Windsor and owns a casino in San Pablo, also declined to comment on the measure.

California cardrooms, which have long been at odds with the tribes, are lining up against the measure, with seven operators pouring in $7 million.

“This initiative will not legalize sports wagering in California, said Kyle Kirkland, president of the California Gaming Association, in a statement. ”Instead, it expands the tribal casino operators' untaxed monopoly on gaming without benefit to Californians and prioritizes tribal casino operators' wealth over the needs of California communities...“

Since the U.S. Supreme Court in 2018 cleared the way for sports gambling across the country, 30 states and the District of Columbia have legalized wagering on sporting events, according to the American Gaming Association.

The California measure would allow gamblers to place bets on professional, college and amateur sports, except high school sports and California-based college teams.

Last year, state Sen. Bill Dodd, D-Napa, in the face of staunch opposition from tribes, withdrew a bill he co-sponsored that sought to legalize sports betting at all gambling venues and online He told The Press Democrat in an interview last week he opposes the current measure.

“I think it’s a real overreach by the tribes in general,” Dodd said, while praising Graton and other tribes for their contribution to local communities. “They have a right to do it. But setting up an anti-competitive situation or procedures against your competitors is pretty extreme.”

Prohibiting online gambling, which Dodd said could account for 90% of betting action, would likely reduce state revenues. Digital wagering could help raise more than $500 million a year, he said.

Dodd expects well-capitalized online sports betting companies, such as Draft Kings and Fan Duel, to eventually enter the campaign against the measure.

“That may give the legislature an opportunity to work with the tribes to come up with a consensus that really makes sense, which was really what we we were trying to do all along on my bill last year,” Dodd said, hoping the sides can come together on new legislation before the measure goes before voters.

McCuan, the political science professor, said campaign spending on the initiative could dwarf the more than $100 million expended in the run-up to the 1998 ballot measure that legalized casinos owned by tribes in California. The tribes, which have endured a long history of neglect and exploitation by the state and federal government but have since gained significant financial and political power, are prepared to go toe-to-toe with online betting companies, he said.

“This is about sending a message to Draft Kings that you’re willing to go to war, that you have the missiles,” he said of the money Graton and other tribes have already raised. “It signals your commitment, if you will.”

Neither Draft Kings nor Fan Duel responded to requests for comment.

In recent years, the Graton tribe has worked to increase its influence in Sacramento. In 2020, it gave almost $200,000 in support of Jackie Fielder, a progressive Native American candidate who unsuccessfully challenged state Sen. Scott Wiener, D-San Francisco.

Graton Rancheria also donated $1 million to bankroll a campaign in support of the proposed tax extension for SMART, the North Bay’s commuter rail system. Voters rejected the agency-proposed measure in March 2020.

“What Graton has done is created an entity in which it is willing to play at the highest levels of politics,” McCuan said.

On May 28, the day after the sports betting initiative qualified for the ballot, Graton donated $500,000 to the campaign against the recall of Gov. Gavin Newsom, who has so far not taken position on the gaming measure.

You can reach Staff Writer Ethan Varian at ethan.varian@pressdemocrat.com or 707-521-5412. On Twitter @ethanvarian.

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