It is no coincidence the first tribal opposition to AB 831, the bill to criminalize sweepstakes gaming in California, cropped up just hours before an Aug. 18 California Senate Appropriations Committee hearing that included the bill on the docket.
In advance of the hearing, sweepstakes leader VGW has teamed up with Kletsel Economic Development Authority (KEDA), a small California tribe with less than 300 members. In a release, VGW said the partnership indicated the company’s desire to engage with local stakeholders. Those stakeholders were at the ready for what was a relatively brief time in the spotlight.
Committee will evaluate fiscal impact of sweeps ban
After around four hours of a lengthy hearing that discussed more than 250 bills, Assemblymember Avellino Valencia’s bill was placed on the Appropriations Suspense File, along with most of the other bills discussed. That is a mechanism for the fiscal-focused Appropriations Committee to consider proposed legislation’s fiscal impacts on the state.
There, it will get a vote-only hearing to decide whether it is sent to the full Senate floor. At the time of writing, the Appropriations website lists upcoming hearings on Aug. 20 and Aug. 25.
After being overhauled as an anti-sweeps bill, AB831 advanced from the Governmental Organization Committee by a 15-0 vote on July 8 and from the Public Safety Committee 6-0 on July 15. It was subsequently amended to address concerns that individual players could be subject to criminal charges for playing online sweeps.
SGLA claims threat of $1B in economic losses
At Monday’s committee meeting, AB 831 got just a few minutes of play.
Nobody spoke in support of the bill. The Social Gaming Leaderships Alliance (SGLA) and its founding member, VGW, testified in opposition.
An SGLA spokesperson claimed that the bill risks eliminating nearly 1,200 jobs and cutting off more than $1 billion in annual economic benefit to the state by banning “free-to-play entertainment.”
In the past, some tech firms with a California presence, such as PlayStudios, have testified against the measure. PlayStudios works with both MGM Resorts and sweepstakes studios, among other partners, and has an office in Burlingame.
The SGLA urged California to regulate and tax it, a move it posited could generate between $200 to $300 million a year in new revenue.
AB 831’s first tribal opponent criticizes anti-sweeps tribes
While AB 831 is broadly supported by California’s federally regulated tribes and is co-sponsored by the Yuhaaviatam of San Manuel Nation and the California Nations Indian Gaming Association (CNIGA), VGW’s new tribal partner is the first tribal group to oppose the bill, calling it “self-serving”.
KEDA CEO Eric Wright told committee members that digital platforms such as sweepstakes are a key viable channel for smaller tribes in less geographically advantageous locations to fund essential services, and that banning them will deepen disparities and reduce self-sufficiency.
“This bill lacks unanimous support among California tribes, has advanced without meaningful consultation with many of us, and threatens our inherent right to operate legitimate revenue streams to support our people,” he added in a statement.
“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.”
