Caesars vows to remain neutral in California sportsbook push
Operator cites tribal partnerships as forcing position but affirms focus on expanding into every US state should regulations allow
Caesars Entertainment CEO Tom Reeg has confirmed the operator will remain neutral in the California sports betting legislation race as it enters its final 100 days of campaigning.
State voters are set to cast their votes on November 8 on two separate propositions each offering a different method of accessing regulated sports betting in the Golden State.
Caesars has remained on the side-lines, despite being one of the largest sportsbook operators, a stance which Reeg spoke about in the firm’s Q2 2022 financial results call.
“I struggle to think of a jurisdiction we will not go to in the US if it opens. If you think of a very small state that puts up an enormous tax rate, that’s a small possibility, but we want to be everywhere,” Reeg explained.
“In terms of California, we’re not part of either initiative.
“We want to see sports betting in every jurisdiction that we can find. We’d love to see online casino in every jurisdiction we can find,” Reeg added.
Expanding on his comments, Reeg highlighted a need to preserve existing relationships with tribal gaming operators, relationships which could be compromised if the company signs on with either of the propositions being considered.
Among those partnerships in California, Caesars has deals with the Rincon Band of Luiseño Mission Indians and the Buena Vista Rancheria of Me-Wuk Indians in California.
“We have a decade-long relationship with a number of tribes across the country where we’ve been managing their assets through multiple contract renewals, which was a unique position when we bought Caesars. I’ve never seen that before,” he explained.
“We don’t want to be in opposition to tribal interest when we’re their partner, so we’ve remained neutral in California throughout.
“You should expect that to be the case in any state where tribes are at odds with the commercial interest,” Reeg added.
The propositions are backed by a coalition of California-based tribes and a seven-strong group of some of the US’s biggest sportsbook names respectively.
Names providing financial support and lobbying expertise to Proposition 27 include DraftKings, BetMGM, FanDuel, Fanatics, Bally’s, WynnBET, and Penn National Gaming, which have all pledged a combined $100m in support.
The California Solutions to Homelessness and Mental Health Support Act would allow qualified sportsbook operators to partner with California tribal nations to operate online sports betting.
Proposition 26, or the Legalize Sports Betting on American Indian Lands Initiative, allows for sports betting on tribal lands, subject to compacts ratified with the state. It is backed by 44 separate organizations and interest groups, inclusive of 24 separate native American tribes.
Campaigning in the state has become increasingly factional in nature, punctuated by attacks on the operators by the tribes who have drawn attention to claims made by these out-of-state operators through several public service announcement (PSA) advertisements.
DraftKings CEO Jason Robins has featured among those operators targeted by the tribal groups, with DraftKings and FanDuel featured in the latest PSA ad by anti-gambling advocates.
https://youtu.be/v4mzpmIjmEM
The latest of which calls into question whether allowing out-of-state groups to operate sportsbooks would increase California’s problem gambling rates.