California card room cities say tribal sports betting initiative would harm communities

On Wednesday, organizations from several California cities that include those with card rooms announced their opposition to the tribal sports betting initiative, which so far is the only initiative approved for the November 2022 ballot. The card rooms last year filed for their own sports betting initiative, but have not been collecting signatures and the effort is largely considered dead.

The card rooms have turned to the judicial system, where they have sparred in court with the tribes recently over the referendum.

A press release from the organizations distributed Wednesday called the tribal initiative “the only sports betting measure being contemplated for the November 2022 ballot that harms local communities” and alleged that changes to the state’s Private Attorneys General Act would be used to sue gaming competitors.

Marcel Rodarte, executive director of the California Contract Cities Association, contended in the press release that the tribal initiative “exploits the Private Attorneys General Act, opening the floodgates for frivolous lawsuits that will harm city revenues that fund vital city services such as roads, schools, homelessness services, and fire protection.”

In response, the Coalition for Safe, Responsible Gaming — a tribal group that supports the sports betting initiative — issued a statement that said card rooms “have one of the worst if not worst records of noncompliance in the United States with gambling laws, including those designed to guard against crimes like money laundering. That’s why they’ve been fined millions of dollars in recent years for violations like misleading regulators.

“Our measure simply ensures existing laws preventing illegal gambling are being followed. Card rooms following the law have nothing to worry about. Our measure will not shut down a single card room casino that’s operating legitimately. The only card room casinos at risk of legal enforcement are those that repeatedly violate California gaming laws.”

Jobs, economic impact at the forefront

Representatives from card room cities, in their press release, echoed the sentiment that the tribal sports betting measure, which would limit legal sports betting to retail locations at tribal casinos and racetracks, will harm those municipalities.

“During the pandemic, California cities that depend on the revenues generated through legal gaming at card rooms have seen the devastating impacts card room closures have had on municipal budgets and the vital services they fund,” said Leonard Mendoza, mayor of the city of Commerce. “Hundreds of millions of dollars in local revenues are on the line — money needed to invest in the safety and well-being of our residents.”
The organizations allege the tribal initiative will put “more than 32,000 jobs, $1.6 billion in wages, and $5.5 billion in total economic impact at risk.”

A tribal television advertisement, albeit from a different group of tribes than the Coalition for Safe, Responsible Gaming, also stresses job impact and the “exclusive gaming rights” granted to tribes with the voters’ approval of Proposition 5 in 1998. The ad also paints FanDuel and DraftKings as “out-of-state corporations” and said the online wagering initiative is “bad for tribes and bad for all Californians.” The ad began airing late last week.

By Jeremy Balan