Sports betting bill worries tribes enough to poll
Robin Hood Day in House Finance: Wealth tax gets paired with $$ for working families
The push for sports betting outside Native American casinos is back, and it’s apparently got tribal gambling interests a bit worried.
The Washington Indian Gaming Association was in the field in the last few days with a poll on the issue, The Observer has learned.* The poll’s results should land just as most recent proposal from Nevada-based Maverick Gaming, Senate Bill 5212, gets a hearing in a state Senate committee on Thursday.
Loyal readers will remember Maverick and CEO Eric Persson from our yarn about his ill-fated attempt at revenge for last year’s loss on the same issue. To review, lawmakers reserved sports betting for the state’s 29 existing Native American casinos, shutting out the 44 non-tribal card rooms scattered around the state. Nevada-based Maverick owns 19 of the card rooms, which can currently only offer poker and variations of blackjack.
This year’s version isn’t really about the Legislature. That bill’s going nowhere. (Don’t believe us? Let’s bet on it.) This is long game. Maverick is likely teeing up a ballot measure for the November election. The tribes, meanwhile, are preparing to oppose such an initiative, which could be the beginning of erasing their advantage on gambling here.
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This is important because there’s just a ton of money at stake. Since the U.S. Supreme Court struck down the ban on sports gambling, more than $37 billion has been legally wagered in states that allow it. Most of that betting was in just three states: Nevada, where it was already legal, and New Jersey and Pennsylvania, which were the fastest to allow sports betting after the ruling. Some two dozen states now allow sports betting or, like Washington, are in the process of allowing it.
The tribes plan to fold sports betting into their existing mix of slot machines and table games such as roulette, poker and blackjack, which provide tribal revenue under the federal Indian Gaming Regulatory Act. Maverick and other non-tribal interests see big dollar signs in cutting themselves a slice of that action, especially in the exploding area of online betting. If Maverick’s proposal last year had passed, it might have offered you a real-time bet — from your couch, on your phone — that the Seahawks would convert that fourth-and-short against the lowly Giants. (Pro tip: DON’T TAKE THAT BET.)
When lawmakers took the tribes’ side last year, they forewent one of the things they enjoy the most: sweet, sweet tax revenue. That’s a reflection of both the tribes’ political clout and the persuasiveness of their argument that the proceeds from tribal gambling are actually government revenue that flows both to tribal services and to tribal members themselves.
We first heard about this new push from Maverick when they landed some good press in mid-January, generated by this Maverick news release. The gist: The bill has new life because the state’s fiscal straits make new gambling taxes more attractive than ever; because State Sen. Mark Liias, floor leader for majority Democrats in the Senate, is a co-sponsor; and because Maverick has embraced unionization.**
The bill, sponsored by Sen. Curtis King, R-Yakima, is somewhat dialed back from the version that died in committee last year, which would have allowed for mobile betting outside the card rooms. (Remember that Seahawks bet?) Under this version, the app would be restricted by the tracking functions of the player’s phone to work only within the card rooms. Basically, the non-tribal card rooms are asking for what the tribes got. The effect would be around 70 sports books around the state as opposed to about 30.
But it’s not going to happen, and here’s why:
Last year’s bill passed easily, with significant bipartisan support. Lawmakers specifically designated the measure an “emergency” to make it more difficult for Maverick to overturn the new law at the ballot box. Fast-forward nearly a year, and five tribes are in negotiations with the state to implement it, with other tribes sure to follow. Meanwhile, the makeup of the Legislature hasn’t materially changed, and the tribes’ clout hasn’t gotten any smaller. Thursday’s hearing is most likely a courtesy to the bill’s sponsors,*** and to Maverick’s well-connected lobbying team.
The Washington Indian Gaming Association wouldn’t comment on their poll, but sent us this statement on Maverick’s bill:
“An out-of-state gambling company has spent tens of millions purchasing nearly half of the state’s card rooms and is now supporting dangerous legislation that would do away with key protections in Washington’s existing gaming system. The Washington Indian Gaming Association believes the legislature made the correct decision last year, to allow limited and carefully regulated sports betting in our state, restricted to the brick-and-mortar premises of tribal casinos.”
That said, Maverick’s arguments aren’t nothing. There would be tens of millions of new taxes for the state, with tons of growth potential. That’s also a selling point for a ballot initiative. Sample message: It’s not just betting on football; it’s helping the kids. Maverick’s embrace of organized labor adds further intrigue. Unions, including the Teamsters, who represent Maverick’s workers, are a potent potential ally in a ballot initiative campaign.
One interesting variable in this whole thing: Maverick could conceivably go to the voters with a much more sweeping proposal than what they sent the Legislature this year, an initiative that offers mobile betting anywhere. Many of the states that have legalized sports betting have done that, thanks to a massive lobbying effort by Draft Kings and other online players. That could broaden the appeal to folks who like to get a bet down, but don’t want to leave the comfort of their couches.
To get to the last last time voters considered anything like this issue, we’re going to need the Wayback Machine. In 2004, initiative huckster Tim Eyman, with half-hearted backing from non-tribal gambling interests, tried to legalize slot machines outside tribal casinos. The no campaign was bankrolled by the tribes, but ran essentially on anti-gambling messaging. Short version: gambling is bad; let’s leave it on the reservation. Opponents outspent Eyman 6-1, and the initiative failed by more than 640,000 votes.
But many things would be different about a 2021 campaign for sports betting. Things have changed since 2004. Fantasy football and NCAA basketball pools have exploded in popularity even though they’re technically illegal here, as has offshore sports betting. ESPN and other sportscasters discuss point spreads in open acknowledgement that viewers have money riding on the games they’re watching. And while a slot machine gambler looks like a person putting coins into a beeping, flashing machine, the modern sports gambler looks like someone obsessing about football on his or her phone. Meanwhile, a generation of socially conservative, largely anti-gambling voters are no longer with us, replaced by younger voters raised on mobile gaming, much of which involves elements of chance.
As Maverick was getting shut out last year, Persson vowed to spend $20 million overturning the Legislature. Thus far, he hasn’t, but it’s an interesting number. It so happens that $20 million is the record for a campaign to pass a ballot measure in Washington. Costco spent that in 2012 to break the state monopoly on retail sales of hard alcohol. They’ve sold a whole lot of handles of whiskey since then.
*The Observer was initially tipped by someone who was surveyed. Two well-placed sources confirmed that WIGA was behind it.
**In the media-relations biz, this is called “earned media” because there’s an element of persuading the publication in question to run a story that frames the issue to your advantage. Safe to say Maverick’s people earned their money.
***Sen. King is ranking member on the Senate Transportation Committee, which gives him more clout than the typical member of the minority. Liias’ support is more interesting because he was was a “yes” vote on the tribal bill last year. He told the Times he signed on to Maverick’s proposal as an “opening of that dialogue.” But he’s coming off a brutal beat-down in a Democrat-on-Democrat race for lieutenant governor, which he lost to U.S. Rep. Denny Heck by some 440,000 votes. Heck raised three times as much money as Liias, in part by locking down the vast majority of the Native American money.
It was Robin Hood day in House Finance, with the wealth tax paired with $$ for working families
That proposed tax on billionaires we wrote about last week got its first hearing on Tuesday, in tandem with a bill to beef up a tax credit for the working poor that the Legislature has never actually bothered to pay for.
Committee Chair Noel Frame’s House Bill 1406 would tap intangible financial assets (think stocks, bonds, etc.) over $1 billion, a proposal that take some $2.5 billion per year from fewer than 100 of Washington’s richest people. She described it as a tool to begin comprehensive reform of an unfair tax system.
The actual list of taxpayers is strictly confidential, but public information indicates that Amazon founder Jeff Bezos would pay more than half the total, in large part because a pandemic-driven flood of online shopping has driven his company’s stock higher in the past year.
Rep My-Linh Thai’s House Bill 1297, which has nearly 50 co-sponsors, including members of both parties, would spend about $250 million annually on tax rebates for low-income people, ranging from $500 per year for single people to $950 for families with three or more children. The underlying working families tax credit passed in 2008, but lawmakers never allocated money to actually send out checks. There’s renewed enthusiasm for it this year because of the devastating effects of the pandemic on so many working people.
“We as a state legislature have not prioritized our working people, those who really uphold our state economy,” said Thai, D-Bellevue. Testimony for the bill was overwhelmingly positive, with more than 1,100 signing in to support it.
Themes of income inequality resonated throughout the testimony for both bills, but the hottest rhetoric flew on Frame’s wealth tax. Frame, D-Seattle, described it as a tool to begin revamping a tax system she described as unconscionable, unacceptable and unsustainable.
Gravity Payments CEO Dan Price, famous for cutting his own pay to radically increase salaries for lower-paid workers at his company, and one of several wealthy tech executives to argue for the tax, brought the shame.
“Will you protect your invite to the billionaire cocktail hour? Or will you show your constituents that they can trust you?”
Anti-tax activist and sometime shoplifter Tim Eyman, one of a handful of people to testify in opposition, brought a stomach-turning metaphor that riffed on the state’s estate tax and the prospect that the taxed billionaires would simply leave for places like Texas and Florida.
“The vultures in government that are picking at the carcasses of the dead now want to stick their beaks into the people that are still alive. That’s going to be a problem, because living people are a lot more mobile than corpses.”
In a feature of the all-remote Legislature that can really no longer be described as a bug, Eyman’s testimony was abruptly cut off by the implacable robot timekeeper that held each testifier to 90 seconds.
To get that vulture metaphor out of your head…
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