AZ Lawmakers Must Consider Tribes When Writing Sports Betting Laws
The lawmakers in Arizona are discovering that crafting sports betting laws for the state is slower than they anticipated, mostly because of pre-existing agreements with tribes who have Indian gaming interests. Other states have called this a “poison pill” because legalized sports gambling at commercial or state-run casinos will reduce the amount of taxes the Arizona tribes would contribute to the state’s coffers.
In Arizona, if legislators introduce sports betting without re-working the tribal pacts, the state will lose a lot of revenue. Right now Arizona has deals with over 20 tribes, each of which pay a tax to the state of up to 8 percent, which is around $80 million a year from gaming revenue. This means that if Arizona writes a law that permits the state or other commercial casinos to offer sports betting, but leaves out the tribes, it won’t work.
Current gaming agreements with the tribes go back to 2002 and these were voter-approved.
Sports Betting in Arizona
Until May of this year, sports gambling was illegal under the Professional and Amateur Sports Protection Act 1992 (PASPA). This law grandfathered in a few states, namely, Nevada, but sports gambling was illegal everywhere else, Arizona included. In May, the Supreme Court overturned PASPA allowing individual states to develop sports betting legislation. To date, sports betting is still gambling in Arizona; in fact, state law generally bans betting at all, except for the lottery, horse racing, and the deals made with tribes. Any gambling between friends is legal except for those cases where it is organized by a third party.
If the Arizona legislature votes to legalize sports betting, a new compact with the tribes will have to be reworked and renegotiated. The soonest any legislation will be debated will be in January 2019 when the next legislative session starts, unless Governor Ducey calls a special session.
In 2002, voters approved the deal between the 21 different tribes and the state operating casinos and other gaming offerings on tribal lands. The agreement allows for Las Vegas-style gaming, and limits the number and types of games allowed at casinos. In the deal, the tribes have to contribute between one and eight percent of their gaming revenue to be split between local and state governments.
So far, the tribes have contributed around $1 billion in revenue to the state from their gaming income.
Sports Gambling in Other States
Six states have legalized sports betting to date, but only Mississippi has tribal gaming. In Mississippi, though, the tribes don’t have anything to do with the state’s gaming commission.
Arizona Tribes Want in on Sports Betting
Tribal leaders are happy to add sports gambling to their offerings and are willing to work with the state to work out an adjusted pact. In a statement to 12 News in May, the governor of the Gila River Indian community, Stephen Roe Lewis, said:
“We are looking forward to discussing with the state how we can go about working together on developing this opportunity, which could be a win/win for the state of Arizona and Arizona tribes.”
It will be interesting to see how Arizona navigates this complex sports betting framework, considering how many tribes the state already has deals with. It feels very similar to some of the struggles that other states like New York, California and Florida are running into. Each state is different, so we’ll see if Arizona can find a successful and happy resolution for all parties involved.
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