Arizona Lawmaker Tries To Bring Attention To Tribal Sports Betting Unfairness

One Arizona lawmaker wants changes to the inequitable treatment of Native American tribes under the Arizona sports betting law.

Since before that bill’s passage, Sen. Sally Ann Gonzales spoke out against the deal as bad for Indian tribes in Arizona.

With Senate Bill 1674, she asks for two key changes:

• Increase mobile sports betting licenses available to tribes from 10 to 22. This would allow every tribe in Arizona the opportunity to participate.
• Allow tribes to place retail sportsbooks within a five-block radius of a sports facility or complex.

Gonzales explained her frustrations to PlayAZ.com:

“It’s a matter of fairness. Twenty-two tribes around the state had to compete for 10 Indian licenses. And the non-Indians didn’t have to compete. They just applied and each got one. And they even have one or two to spare, for who I don’t know.”

Tribes agreed to separate but unequal treatment

During last year’s legislative debate, Gonzales offered an amendment to increase mobile sports betting licenses available to tribes from 10 to 22.

Her amendment was quickly dismissed because 21 of 22 tribes in the state agreed to the terms in compact negotiations with the governor. This includes her own tribe, the Pascua Yaqui.

Gov. Doug Ducey wanted both tribes and sports teams to have access to the same 10 mobile sports betting licenses.

“This is government action and the government is treating licensees substantially different,” said Tolanya Adams, an analyst for Sen. Gonzales. “One group happens to be comprised of Native Americans, and the other group happens to be comprised of all Caucasian males. What is the basis? What is the rationale?”

In return for agreeing to this limitation, tribes did get other benefits. These include expansion of gaming to offer baccarat, craps, roulette and pai gow, an increased number of slot machines and the right to build 10 additional casinos.

But the biggest benefit was the compact extension itself.

“In essence, what he did is tell every tribe if you want a new compact signed with me for 20 years, you had better agree to the legislation,” Gonzales said. “He twisted their arms behind their back with the leverage of signing compacts for another 20 years. Because that’s what every tribe needed to go to financiers to lower interest rates for loans they had taken out to build facilities.”

Arizona took $500,000 from Indian tribes for nothing

Arizona’s sports betting law required a $100,000 non-refundable application fee for a mobile event wagering license. For successful applications, that money went toward paying the $750,000 for a five-year license.

Given that there were only eight applicants for 10 licenses, sports teams put in their application fee, knowing it would go toward their license.

“Their $100,000 is not at risk and not going to be denied,” Adams said. “And Indian applicants have a flip-of-a-coin chance to get a license.”

With 10 tribes awarded licenses, five paid a $100,000 application fee to the state and got nothing in return.

Gonzales’ tribe is one of the five out the $100,000.

The Pascua Yaqui has the third most tribal members in the state. However, its reservation is a small piece of land in a rural area nearest to Tucson.

Tribes and sports entities pay same for different rights

The 10 tribes and eight sports entities granted event wagering licenses each paid $750,000. But they don’t get equal opportunities for that money.

Each can partner with one mobile sports betting operator. But sports teams can place a retail sportsbook within five blocks of their stadium or arena.

Tribes also can have retail sportsbooks at their casinos, but that is not part of the commercial license. That is granted through their compacts under the Indian Gaming Regulatory Act.

It might not make sense to let tribes place sportsbooks outside stadiums and arenas. But, in entering a commercial agreement, it would give them what they paid for.

Adams explained:

“They created a brand new gambling industry in its infancy and said there’s two categories of licensees that can play in this arena – Indians and non-Indians. For the non-Indians category, they get land-based rights within five blocks of a sports arena and mobile rights. For the Indians category paying the same $750,000, they only get mobile rights. This bill addresses asks for native tribes granted licensee by a government agency to be treated fairly in this commercial gaming enterprise and have the full rights and benefits of every other licensee for which they are paying an equal cost.”

Bill starts conversation but has little hope of passing

Gonzales doesn’t have widespread tribal support for the bill. She says she’s still trying to gauge where other tribes stand on the issue.

“Of course, tribes who got the licenses may or may not support this effort because they got the license,” Gonzales said. “They’re going to benefit. But they’re not going to benefit to the extent that non-Indian people are going to benefit from their license that costs the same amount of money.”

She wants to get media attention for the inequity in the commercial sports betting license and licensing process for Indian tribes.

However, she knows it’s unrealistic to hope the bill passes this year. It’s unlikely to get a hearing prior to Friday’s deadline to hear bills in the Arizona Senate committee.

The bill was assigned to the Senate Commerce Committee. Gonzales is a Democrat in a chamber and legislature controlled by Republicans.

Lawmakers also know if they passed the bill, it would almost certainly get vetoed by Ducey. The governor isn’t going to sign off on changes to the agreement tribes made with him just last year.

“It’s certainly an uphill battle,” Gonzales admitted. “But I want people to know the situation firsthand from a tribal member.”

She added that she might attempt to attach language to other legislation refunding the $100,000 license fee put up by tribes not awarded a license. That could be her best hope of making an impact for tribes this session.