A major state politics player

California's mayor union AFSCME opposing tribal ballot measure as lines are drawn in the sports betting legalization battle

2022-07-22
Reading time 3:20 min

A major player in California politics unveiled Thursday its stance on the sports betting measures that will be on the November ballot. The American Federation of State, County, and Municipal Employees (AFSCME) District Council 36 has announced its opposition to Proposition 26, a proposed constitutional amendment with the backing of most tribal gaming entities that would allow retail sportsbooks at Indian casinos and state-licensed racetracks.

The Los Angeles-based council represents 60 local unions and 20,000 union workers across California. It argues the measure “could result in $500 million in lost tax revenue for California communities.” Joining AFSCME District Council 36 in opposition to the initiative are AFSCME Local 773, AFSCME Local 3624, and AFSCME Local 3947.

"Proposition 26 puts $500 million in local tax revenue at risk due to the poison pill that will bankrupt community cardrooms. And when city revenue is slashed, public employee jobs like mine are on the line," said Shavon Moore-Cage, a member of AFSCME Local 36 Management Chapter. "This is not just some hypothetical statement. I can tell you from experience what happens to city workers when cardrooms are forced to shut down."

The statement was released Thursday afternoon by Taxpayers Against Special Interest Monopolies, a political committee sponsored by licensed card clubs in California. Cardrooms claim Prop 26 would amend the State Constitution to guarantee tribal casinos “a near monopoly on all gaming in California” by not only providing them with control over in-person sports betting but by adding exclusivity over roulette and craps, in addition to an existing monopoly on slots.

Cardrooms are also opposing a provision that would “weaponize” the Private Attorneys General Act (PAGA) “so it can be used against tribal casino operators’ legally-operating competition.” Cardrooms argue this change allows private entities to file complaints through the PAGA against organizations they accuse of illegal gambling practices: tribal casinos would be able to hire private trial lawyers and replace the role of the Attorney General to sue competitors.

“As a result, the measure puts more than 32,000 jobs, $1.6 billion in wages and $5.5 billion in total economic impact at risk,” the AFSCME District Council 36 statement reads. “Cities rely on this revenue for resident services such as public safety, housing and homeless programs.”

Also opposing Prop 26 are the California Contract Cities Association, Gateway Cities Council of Government, and “many mayors and elected officials representing communities across the state,” according to AFSCME District Council 36. The in-person constitutional amendment is also facing strong opposition from a coalition of major sportsbook operators, which support an online sports betting measure that has also qualified for the November ballot.

The fight for sports betting legalization in California is heating up, with both tribes and sportsbook operators ramping up their campaigning efforts ahead of the November ballot. Online operators, which have built a $100 million lobbying fund for their effort, are taking on Native American tribes in what is set to be the state’s most expensive political campaign ever.

While operators may have found a new ally in AFSCME District Council 36 in their opposition to Prop 26, their own initiative, Proposition 27, is also facing rejection from other groups as lines are being drawn in the sports betting battle. Advocacy group League of California Cities recently voted to oppose the online betting measure. It argues it would jeopardize local tax revenues, and that it “fails to ensure” that all California cities receive funding to address homelessness (Prop 27 calls for 85% of tax revenue from mobile betting after regulatory costs to go to homelessness programs).

Online operators are also facing rejection from California’s Democratic Party, which holds majorities in the legislature and occupies the governor’s office. Democrats voted earlier this month to oppose online sports wagering legalization while staying neutral on retail betting. The party announced its support for several ballot measures, but not for the two legal sports gaming initiatives that will go before voters in November.

The move to not oppose Prop 26 was seen as favorable for the supporters of the retail-only proposal. The party’s stances on these competing measures give voters a guide on which way to vote when they appear on ballots in November. While Democrats aren’t outright supporting the tribal measure, it would seem they won’t oppose it.

California ranks among one of the biggest prizes if a sports gambling ban is overturned. Experts forecast the market is worth around $ 3 billion each year, an attractive segment not only for heavyweight operators but for Native American tribes, which run one of the biggest networks of casinos and bingo halls in the US.

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