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Tribe sues to end sports betting

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One of the state’s Native American tribes is suing to bring a halt to off-reservation wagering on sports just weeks before it is scheduled to begin.

The lawsuit, filed in Maricopa County Superior Court by the Yavapai-Prescott Indian Tribe, contends that state lawmakers have no right to permit sports franchises to start taking wagers on professional and collegiate games. Attorney Luis Ochoa said that’s because Arizonans went to the polls in 2002 and voted to confine certain kinds of gaming to reservations.

And Ochoa said if there was any doubt about voter intent, that can be dismissed by the fact that another measure on the ballot that same year to permit off-reservation gaming was defeated, with 80% of the votes cast against it.

Ochoa does not dispute that other tribes in the state have signed agreements with the state to permit such off-reservation gaming. In exchange, these tribes got the right not only to accept similar sports bets at their gaming facilities but got to expand the number and types of Class III games — things like poker and slot machines — they can offer in their casinos.

But he said that still doesn’t get around the 2002 measure which he said is subject to the Voter Protection Act. That constitutional provision allows lawmakers to alter what is approved at the ballot only if it “furthers the purpose” of the original law.

“HB2772 not only fails to further the purpose of Proposition 202 of granting the exclusive right to Arizona-based Indian tribes to engage in gaming activities classified as Class III gaming under the Indian Gaming Regulatory Act on Indian lands, it is directly repugnant to and inconsistent with the intent of Proposition 202,” Ochoa said in his court filings.

And if a court doesn’t accept that theory, Ochoa has several others, including what he claims is unconstitutional discrimination against Native American tribes. He said the gaming rules are much more favorable to the sports franchises than they are to the tribes.

There was no comment from Gov. Doug Ducey who is named as defendant in the lawsuit. It was Ducey who negotiated what he called the “modernized gaming compacts” with the tribes that went along with the deal.

But the lawsuit drew an angry reaction from Sen. T.J. Shope, R-Coolidge, who sponsored one of the versions of the law that the governor eventually signed.

He pointed out that the lawsuit was filed not when the measure was signed by Ducey on April 15 but now, after applications have been accepted to operate the new sports gaming operations and with actual wagering supposed to start on Sept. 9, just ahead of the Arizona Cardinals’ first regular season game.

“The timing of these challenges, at the dawn of selection rather than during the legislative session or upon the bill’s enactment, amount to an end-around run on that qualifications-based awarding process at the Department of Gaming,” Shope said in a prepared statement. “I expect any legal challenges to be quickly dismissed so that the economic opportunities already happening as a result of (the) tribal-state gaming compact amendment can continue to materialize.”

That first legal test will be this coming Friday: Maricopa County Superior Court Judge James Smith has scheduled an emergency hearing on Ochoa’s request to put an immediate halt to any new gaming until the legal issues are resolved.

Arizona has had some form of tribal gaming since the 1990s.

In 2002, a coalition of tribes crafted an initiative to give them the exclusive right to operate casino-style games in exchange for giving the state a share of the profits. By definition, that limited such gaming to reservations.

The plan approved by the legislature earlier this year allows not only wagering at sports facilities like the Cardinals stadium on all professional and college games, but also the ability for the companies with which they associate to offer online gaming.

And the deal is set up so the state gets a share of gaming revenues, a figure that could exceed $100 million a year.

In exchange, the state agreed to ink new gaming deals with tribes, giving them similar rights to wager on sports. But they also get to install more of the slot machines and poker tables they now have as well as the ability to offer things like craps, roulette and baccarat.

Ochoa, on behalf of the Yavapai-Prescott Tribe, says the deal is illegal, not only because of the 2002 initiative but because it also is unfair.

It starts with the fact that there are only 20 sports gaming licenses being award.

Half, he noted, go to existing sports franchises. And given there are more licenses than franchises, that means every franchise that wants one gets one.

But with at least 21 tribes in the state, Ochoa said, that gives any one of them less than a 50% chance of landing one of the lucrative franchises.

And there is no chance of the Yavapai-Prescott Tribe getting one as the deal says only those tribes that agreed to the new gaming compacts get a shot at it. Ochoa said the tribe was “excluded from all negotiations” on that deal and has not agreed to sign it, as doing so would remove its rights under the 2002 deal for exclusive gaming rights.

It’s even worse, Ochoa said.

Anyone wanting a franchise has to pay a non-refundable $100,000 application fee “despite the stark differences in likelihood of obtaining a license.”

All that, he said, amounts to illegal special legislation.

Beyond that, he said the disparate treatment of sports franchises and the tribe “discriminates between race and origin.”

 

 

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