Why are California Tribes Against Online Sports Betting in 2022?

As two separate legal sports betting bills in California are set to be voted on in 2022, many are wondering why there even needs to be multiple initiatives at all. If legalizing sports betting is the goal, why are there two sides to this discussion? Why do California tribes oppose legal online sports betting? And why haven't online retail sportsbooks done more to get California tribes on board?

Like everything else when it comes to the issue of legal online sports betting in California, the answer is complicated, seemingly without any right way to go. But with the vote on legal sports betting in California fast approaching, we thought it would be a good idea to figure out what exactly has pit the California tribes and retail sportsbooks against each other?

California Tribes Have Multiple Concerns About Online Sports Betting

Of the many arguments being laid by California tribes, they have focused the most on the state's promise for "tribal sovereignty" when it came to sports betting within the state. This idea basically gave California's federally recognized tribes exclusive control over any eventual implementation of sports betting—not only the acceptance of wagers, but the rights to all the profits, notwithstanding any taxes they would need to pay.

As legal sports betting throughout the United States has exploded, the idea of "tribal sovereignty" with regards to it has largely faded. The business is too big, many argue, to grant what would amount to a monopoly to state tribes. There is also a concern that tribes alone are ill-equipped or outright unable to set up proper online offerings at a time where that's how most sports bets are actually placed.

Many states have been able to get tribes on board with including commercial sportsbooks in their legalization plans. Others, such as Florida, have struggled to get everyone on the same page. California is in a similar boat. It is also the first instance in which tribes and commercial sportbooks are running competing bills against one another that both made it onto a single ballot. This is why many believe the results of the November 2022 ballot are expected to be used as a precedent for future resolutions in other states.

Commercial online sportsbooks have tried appealing to the masses by proposing a bill in which 85 percent of all tax revenue would go towards causes that fight homelessness. This particular initiative also stipulates every online retailer must partner with one tribal casino, so that they can share in proceeds.

Tribes, meanwhile, argue that this is an empty gesture. They have pointed to ambiguous wording in the tax revenue section that suggests 85 percent of the profits would, in fact, not need to reach causes that combat homelessness. On top of that, tribes have also pointed out the partnership terms are inconsistent, at best. Select casinos would be chosen to team up with larger sportsbooks such as DraftKings, FanDuel, Caesars, etc. But others would be forced to partner up with smaller entities, which would create a discrepancy in how much revenue is being generated up and down the board.

Gambling Addiction Also Worry California Tribes

Another downside of legal online sports betting the California tribes have pointed out is the potential increase of gambling addictions. Increased access will likely lead to an uptick in people facing those issues. Organizations who help people with gambling addictions via chat and by phone have reported demonstrative year-over-year increases in the number of cases they're dealing with since legal sports betting entered a majority of the United States.

Online sportsbooks have called this argument hypocritical. After all, the tribes are pushing to offer sports betting; they can't be entirely against it. But the tribes have responded by saying their sports betting initiative wouldn't turn every phone, computer, laptop, table, etc. into a mechanism for sports wagering.

Tribes have also been quick to note how allowing commercial sportsbooks to operate within the state would lead to dramatic increases in legal sports betting advertisements. Neither federal nor state governments have set limits on how much retails can spend to advertise, which has led to hundreds of millions, potentially billions, of dollars being devoted to selling new customers on sports betting services. That exposure is not something tribes believe will be helpful.

What to Expect from the Vote on California Sports Betting

Nothing outlined here is projected to derail the legalization of sports betting in California. At least one of the two initiatives on the November ballot is expected to pass. The only remaining question is whether the approval will include online sports betting or only on-site wagering.

As you can imagine, the California tribes-backed bill supports only brick-and-mortar wagering at casinos. The retailer-supported bill, on the other hand, would allow for full-scale gambling. California would be free to roll out sportsbooks in casinos and betting kiosks at sporting venues, and online sportsbooks would be granted access to one of the most widely sought after gambling markets in the world.

In the event online sports betting is not part of California's legalization, though, residents of the state won't be completely out of luck. There are plenty of odds providers from our list of the top online sportsbooks that will allow Californians to set up an account and immediately begin processing transactions—including deposits, bet slips and withdrawals.

Take a look at this list of the top online sportsbooks so you can find one that works for all of your sports betting needs: