Proponent Ends California Sports Betting Initiative Effort Due To Tribal Opposition

Written By Matthew Kredell on January 22, 2024
California Sports Betting Initiative Ends

Proponents will not continue their efforts to put a California sports betting initiative on the ballot against opposition from California gaming tribes.

Kasey Thompson, spokesperson for the initiative, told PlayUSA:

“This initiative was supposed to be for the tribes but is only causing division. That was never my intent. I see now the needed unity is not coming, and so I’m standing good to my word and not moving forward. I’m pulling it in full.”

From the beginning, Thompson said he would not move forward with the initiative without tribal support.

He continued on as tribal opposition mounted, bolstered by private encouragement and a small amount of public support among the 110 federally recognized California tribes.

With it being put up or shut up time regarding collecting signatures in time to qualify for the ballot, Thompson is backing down.

“We tried everything until the very end, but it looks like there would be money from the three big tribes against it, making it impossible to pass in a public election,” Thompson said. “The only thing I would create from here is a civil war.”

Proponents never collected signatures on initiative

Thompson previously told PlayUSA that he had the best signature-gathering firm in California and would print 1.2 million petitions the day that title and summary came out.

But it turns out that was just posturing to keep hope alive for growing support.

In the end, Thompson didn’t get petitions printed or a single signature. He didn’t set up a ballot measure committee, which is needed to begin a campaign and hire a signature gathering firm.

Thompson said he did have a firm lined up. But he didn’t want to put $5 million down to begin signature gathering until he decided whether he could move forward.

“I had it set up, ready to go,” Thompson said. “I could have them on the street tomorrow. But it wasn’t looking good with tribes. They just don’t want it this year.”

CA sports betting effort tripped at the start

Thompson introduced an initiative with the hopes of getting tribal support rather than securing tribal support before introducing an initiative. That gave tribes little time to consider the proposal.

California Nations Indian Gaming Association (CNIGA) Chairman James Siva told PlayUSA:

“I think that was his biggest mistake, the timeline he left for tribes and his other partners. The manner in which they filed and the timeline they created wasn’t beneficial for anybody. Tribes are always willing to have conversations. But when you put our backs against the wall, we’re going to do what what’s needed to protect our exclusivity, which is an extension to our sovereignty, the most important thing to us.”

Thompson did talk with some tribes before filing the initiatives but tried to keep the effort quiet, prioritizing having the only sports betting initiatives filed for the ballot.

Reeve Collins and Thompson, co-founders of Pala Interactive, thought the Pala Band of Mission Indians would lead the initiative following their previous successful venture.

In October, Pala Chairman Robert Smith did tell fellow tribal leaders he would soon issue a press release regarding a sports betting initiative. But he backed out after receiving backlash from tribal counterparts during the G2E convention in Las Vegas.

Thompson and Collins went forward and filed the initiative later that month without any tribal involvement. As amended, the initiatives weren’t offensive to tribes. One was merely a constitutional amendment ensuring tribes have exclusivity over sports betting. San Manuel developed the language for the main initiative during last election cycle.

But California’s biggest gaming tribes had already decided they would not pursue a sports betting initiative for 2024. They still didn’t have a plan that all tribes could get behind, and polling showed the issue wasn’t popular with voters following a 2022 campaign to defeat an initiative from sports betting operators.

Effort got little public support

Thompson and Collins thought tribes would buy into their plan to make themselves and tribes money by transitioning ownership of the California operations of offshore gaming assets to tribes. But tribal leaders were wary of what some called a ploy to use their good reputations to clean illegal gaming apps.

What interest the effort did get was from rural tribes that saw the initiative as a chance to get real revenue share from gaming. Thompson amended the initiative to provide the entire 25% tax collected to Revenue Sharing Trust Fund tribes.

That got four RSTF tribes to tell PlayUSA they supported the initiative, creating division among tribes. CNIGA had previously tried to present unified opposition against the initiative with 37 (of 52 member tribes) voting to oppose and none voting in favor.

“This was never about big tribes versus small tribes,” Siva said. “This was always about trying to maintain the unity we built. They came in and rattled the cage a little bit, but I don’t think it was ever leading to a civil war.”

Ultimately, most tribes stayed quiet. Not even Pala, the original tribe involved, ever came out in public support.

“There were a lot more tribes that expressed interest in the initiative, all kinds of stuff happening in private,” Thompson said. “But I needed public support. I’m really disappointed. I thought the bill was so good that everyone would like it.”

Thompson said he would start collecting signatures but not continue unless sports betting operators contributed. The Sports Betting Alliance, comprised of four top sports betting operators, quickly responded by making official its stance against the initiative.

In a last-ditch effort, Thompson said he offered to write a group of tribes a $25 million check, step away and let them run with the initiative as a tribal proposal. But the support wasn’t there.

He said he felt his biggest mistake was not coming to tribes earlier and taking a backseat if tribes let him in the car.

“I would do a lot of things differently,” Thompson said. “I would have involved the tribes way earlier and left it in their hands from the beginning.”

Future for California sports betting

Californians won’t have a sports betting initiative to consider on the ballot in 2024, unless in the unlikely event that legislators push a ballot referendum.

On a recent webcast with Indian Gaming Association conference chair and Pechanga member Victor Rocha, Siva said that a successful California sports betting proposal would have to come from tribes and that it was possible in 2026 but more likely in 2028.

Siva also indicated that he favored starting sports betting in person at tribal casinos and taking an incremental approach to online sports betting.

“I tried to do something tribal that I thought was great,” Thompson said. “They didn’t want it. I think the tribes have it figured out in the future and there’s no reason for me to be involved anymore.”

Thompson wouldn’t speak to where his plans to cleanse offshore gaming assets go from here. He did say he hopes to work with California tribes in the future.

“I’m not going to force myself on them, but I’ll offer as much advice as they want,” Thompson said. “I would love to work with them in the future.”

Siva wouldn’t rule that out.

“I think they probably have an uphill battle to repair that relationship, but I won’t say that is impossible to happen. Last election, the big corporate companies such as FanDuel and DraftKings were in that position. And this time, they came out in opposition of this initiative and supported the tribal position, so I think they are trying to repair those relationships from Prop 27. This one is a little different, but there’s always a chance we can come together. It’s all about tribes continuing to maintain their own destiny and doing the right thing at the right time.”

Photo by PlayUSA
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Matthew Kredell

Matthew Kredell serves as senior lead writer of legislative affairs involving online gambling at PlayUSA. He began covering efforts to legalize and regulate online gambling in 2007 after federal passage of the Unlawful Internet Gambling Enforcement Act disrupted his hobby of playing small-stakes online poker. He has since interviewed more than 300 lawmakers around the country and written extensively about online gambling legislation. He has led coverage of bills to legalize online gambling in most states. A lifelong Angeleno and USC journalism alum, Matthew started his career working as a sportswriter for a decade at the Los Angeles Daily News. He has written on a variety of topics for Playboy Magazine, Men’s Journal, Los Angeles magazine, LA Weekly and ESPN.com.

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