Oklahoma remains one of the key tribal gaming markets that has yet to legalize sports betting, with animosity between tribes and Republican Governor Kevin Stitt expected to forestall regulation for the foreseeable future.
A bill to authorize sports wagering at tribal casinos via amendments to Oklahoma’s tribal-state gaming compacts was passed by the state’s House of Representatives in March, only to die a swift death in the Senate, with tribal gaming experts hardly optimistic that legislative prospects will be improved in 2024.
“The status among the tribes and Governor Stitt, let’s just say it’s fraught,” said Steven Light, a political science professor and tribal gaming expert at the University of North Dakota.
Tribes have not forgiven Stitt for his unsuccessful attempts to renegotiate their long-standing gaming compacts to require tribes to pay increased revenue sharing, after rejecting tribes’ arguments that the compacts automatically renewed for a second 15-year term on January 1, 2020.
A federal court judge sided with the tribes in October 2020.
Stitt supports requiring tribes to share 25 percent of sports-betting revenue with the state. House Bill 1027, which advanced to the Senate earlier this year, proposed a sliding scale from 4 percent to 6 percent depending on monthly revenue.
“It is clear that the introduction of sports wagering will come at some price,” Light said. “Governor Stitt has that flagpole in place, so revenue sharing is an expectation in any of these conversations going forward.”
Light added that the new tribal gaming compacts that Stitt signed in 2019 with the Comanche Nation and Otoe-Missouria Tribes included higher revenue-sharing rates.
Those compacts were deemed approved by the Secretary of the U.S. Department of the Interior, but the Oklahoma Supreme Court ruled in 2020 they were invalid.
The status of those compacts is still being litigated in federal courts.
The future of both compacts is being litigated, said Kathryn Rand, a law professor at the University of North Dakota.
Light and Rand participated in a webinar on Thursday (May 11) discussing what is next for sports betting in Oklahoma sponsored by the International Center for Gaming Regulation at the University of Nevada Las Vegas.
Among the other political variables, Light said, is the potential for what bills look like in the next legislative term.
“We don’t know that or how even the conversation will be ongoing between now and then,” Light said of prospects in Oklahoma’s 2024 legislative session. “It is clear that any number of issues that are up in the air, including these compacts that will presumably be solved in court, will impact future legislation.”
Oklahoma’s slow progress on sports betting contrasts with several other major tribal gaming states, Jamie Hummingbird, director of the Cherokee Nation Gaming Commission and chairman of the association of National Tribal Gaming Commissioners/Regulators.
Speaking at last week’s SBC Summit North America in New York, Hummingbird noted how Michigan tribes negotiated with state lawmakers and the governor and now participate in online gaming on level footing with Michigan’s three commercial casinos.
“In Oklahoma, you don’t have that; what you have is a very adversarial relationship between tribes and the state,” Hummingbird said.
Tribes are participating in online sports wagering on a similar basis to Michigan in both Arizona and Connecticut. Sports wagering is also offered at tribal casinos through tribal gaming compacts in at least 18 states, according to VIXIO GamblingCompliance research.
Oklahoma is the second largest tribal gaming market in the U.S. behind California, with 133 casinos operated by 33 tribes. The industry reported $3.2bn in revenue in 2022, paying $192m in revenue-sharing payments to the state.
“This is a big market. A lucrative market for tribes,” Rand said.
Rand admitted that with so many tribes even if the state does authorize sports betting there will still be significant competition between tribes offering wagering.
“And what tribes are allowed to offer will put them in direct competition with what is permitted in neighboring states,” she said. “So if you are allowed to engage in mobile wagering in the future in Texas that might have a significant impact on the market in Oklahoma.”
Among the six states that border Oklahoma, Arkansas, Colorado, and Kansas all offer mobile sports wagering, while New Mexico tribes operate retail sportsbooks.
Oklahoma lawmakers previously passed legislation to expand tribal gaming to include craps and roulette games at tribal casinos, but that was a few months before Governor Stitt took office in 2019.
“Oklahoma has been conservative in terms of what games it has authorized tribes to conduct,” Rand said.
“Our guess is that with the state’s stance on revenue sharing and the conservative approach to expansion of legal gaming, we aren’t going to see much beyond sports betting, but it is a possibility.”
Additional reporting by James Kilsby in New York.