California Sweepstakes Casino Ban Takes Turn

The road to a California sweepstakes casino ban just got a lot tougher.

Online casino operator VGW recently announced a partnership with a tribal nation in The Golden State. This agreement has resulted in the first tangible opposition to a California sweepstakes casino ban from a tribal nation authority.

“Eric Wright, CEO of the Kletsel Economic Development Authority, spoke against AB 831 at a mid-afternoon Senate Appropriations Committee hearing on Monday,” writes Matthew Waters of Legal Sports Report. “ KEDA is the economic development arm of the Kletsel Dehe Wintun Nation. Australia-based social gaming operator VGW announced the sweepstakes casino partnership with the tribe of 297 enrolled citizens in a release dated Tuesday.”

This represents a pretty development for the future of gaming in The Golden State. We are not just talking about sweepstakes betting, either. Tribes so far seem reluctant to team up with outside operators to accelerate the legalization of sports betting in California. Could this deal represent a softening on that stance? Or is it merely a one-off?

Other Tribes May Also Oppose the California Sweepstakes Casino Ban

Many assume the California sweepstakes casino ban is universally supported by tribal nations. After all, the California Nations Indian Gaming Association (CNIGA) has co-signed. And they represent 50 of the tribal nations in The Golden State.

Of course, this is a good reminder that California is home to a ton of tribal nations. At present, the state currently has up to 110 federally recognized tribes. And as Wright argues, not all of them support the California sweepstakes casino ban. Here is an excerpt of a letter he sent to the Appropriations committee, courtesy of Legal Sports Report:

“This bill lacks unanimous support among California tribes, has advanced without meaningful consultation with many of us, and threatens our inherent right to create legitimate revenue streams to support our people. For tribes like ours—far from high‑traffic tourism corridors—geography has always limited traditional economic development.‘Large, well‑established gaming tribes already benefit from these geographic advantages and decades of success. It is self‑serving for them to advocate for policies that restrict emerging digital commerce opportunities for others, effectively holding smaller and less‑advantaged tribes’ hostage to their location. Digital platforms offer one of the few viable ways for geographically isolated tribes to fund essential services: healthcare, education, housing, food security, and social programs. The need is urgent.”

Wright’s framing here is interesting. And it extends well beyond the California sweepstakes casino ban discussion.

Online Betting May Hold Key to Geographically Isolated Tribes Generating Revenue

For so long, the meteoric rise of legal online sports betting in the United States has been painted as an enemy of tribal nations. They start out in most markets with gambling exclusivity. Introducing large corporate sportsbooks and casinos into the market seemingly undermines their business model.

This is to some extent true. That is why you see tribes in certain states prioritize the legalization of in-person wagering alone. Just look at the setup of sports betting in Florida. Or even sports betting in Wisconsin. Tribes have exclusivity over sports betting—and gambling at large. In The Sunshine State, specifically, the Seminole Tribe actually holds a monopoly over the industries.

Still, markets like Florida and Wisconsin have something else in common: They are not teeming with dozens upon dozens of federally recognized tribes. Florida has two, while Wisconsin has around 10 to 12.

This is a big difference from California’s 100-plus. It makes sense that it’s harder to reach a tribal consensus. Especially when the CNIGA only represents about half of those.

The point about geographic isolation is particularly compelling. While corporate operators can infringe upon gambling market shares, the risk is mitigated when you’re trafficking in partnerships rather than independent business models. Plus, tribes operating casinos far away from tourist destinations and other high-volume areas are at an inherent disadvantage.

The introduction of social gaming, including California sweepstakes casinos, can theoretically level the playing field. Online options are accessible to everyone. A tribal nation’s location does not matter. In fact, one of the biggest criticisms of sports betting in the United States is that online gaming makes it too accessible. That stance is a conversation for another day. For now, it’s easy to see why the Kletsel Dehe Wintun Nation and others may not support the California sweepstakes casino ban.

Supporters of Sweepstakes Casinos in California May Face an Uphill Battle

Though Wright’s argument seems worthy of discussion, it may also wind up flopping. States across the country are taking aim at online sweepstakes casinos like VGW. Licensed gaming operators believe they’re skirting the laws and infringing upon casino and sports betting compacts.

It is not just licensed tribes or corporate sportsbooks pushing for reformation, either. Policymakers across the United States have sweepstakes casinos in their sights. New York, Delaware, Nevada, Connecticut, Washington, Michigan and Idaho are among the most recent places to take action. A bill in Montana even seeks to criminalize certain services, including promotional ones, offered by sweepstakes casinos.

None of this means the California sweepstakes casino ban is destined to be successful. The latest development is nothing if not proof that opposing stances exist. But with so many of the state’s tribes seemingly already in favor of it, it’ll take both universal and forcible opposition among the others to effectively stamp it out.

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