US Congress Mulling Over Mobile Wagering via Servers in Tribal Lands

As rapid gaming expansion continues across different states in the US, the federally recognized tribes are also rushing to grab a piece of the pie in this lucrative business. But then, some gray areas and technicalities usually need to be addressed along the road to regulation for the tribes.

Connecticut recently had a tussle between two of its federally recognized tribes and the state, but the matter was ultimately resolved after negotiations between the three parties were finally successful. Florida is also facing another of these gaming-related rows, with the Miami Beach Mayor going as far as calling for the DOI to reject a recently inked tribal-state gaming compact. This Florida case has escalated so much that the Southwest Parimutuels have filed a federal lawsuit in a bid to try and stop the amended tribal-state compact from offering mobile sports betting exclusivity rights to the Seminal Tribe.

And now, the US Congress is looking to address one of the issues that are ailing tribal sports betting regulation. There is no clear definition of whether online sports wagers facilitated by servers within tribal land are equivalent to placing the bets in person by players who are physically present on tribal land.

House Bill 4308: Redefining In-Person Gaming to Accommodate the Tribes

Jose Luis Correa, the current US Representative for California’s 46th congressional district, proposed House Bill 4308 to solve the online sports betting puzzle for the tribes. HB 4308 seeks to redefine the bets placed through servers hosted in tribal lands as remote gambling that is tantamount to in-person betting. John Katko, the US representative for New York’s 24th congressional district, joined forces with Rep. Luis Correa to become a co-sponsor of HB 4308.

As he addressed the matter, US Rep. Correa delivered a Congressional statement mentioning that lawmakers would have made a similar filing when the Indian Gaming Regulatory Act (IGRA) was passed in 1988 had online gaming been around at that time. When the IGRA was enacted back then, it came with no workable provisions for online betting.  

Rep. Correa also cited how much the tribes depend on gaming, giving the US Congress all the more reason to ensure that the tribal nations were well-accommodated to keep their business running. He said:

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“Tribal government gaming is the primary source of revenue for hundreds of tribal nations throughout this country who otherwise would not have the basic resources to provide for the health, safety, and general welfare of their citizens and others who live on tribal lands. However, the gaming industry is quickly evolving, and more and more states are legalizing some form of gaming activity that primarily utilizes the internet. Sophisticated, well-financed digital companies that did not exist even ten years ago are changing the gaming industry  before our eyes.”

Snuffing Out Technicalities and Frivolous Lawsuits

Further, the draft legislation is looking to do away with the current federal-level barriers under the IGRA that hinder mobile sports betting on Native American lands should the tribe and state reach an agreement. He pointed out that:

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“As tribal governments begin to prepare to move their gaming activities into the online world, there have been some questions about whether such gaming activities would continue to be primarily governed by the federal Indian Gaming Regulatory Act. As you can imagine, setting up these new gaming systems involves significant financial investments. Tribal governments should not be required to make these investments without having clarity and comfort of what laws will apply to them.”

Part of Rep. Correa’s plan with House Bill 4308 is also to ensure that the tribes aren’t edged out of the rapidly evolving gaming industry by lawsuits such as the one filed in Florida.  He added that:

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“Making this clarification will keep intact the current system of tribal gaming and eliminate any frivolous litigation…Congress needs to provide the clarification in my bill to ensure that tribal gaming is not relegated to the same fate as Blockbuster but can move forward and thrive like Netflix in the era of the internet.”

So, should Rep. Correa’s efforts bear fruits, the case filed by the Southwest Parimutuels against the Seminal Tribe and the Florida state will automatically be dismissed. Florida aside, Tribal Nations in other states will also benefit from the amendment as tribes in states such as North Carolina and Indiana aren’t allowed to offer mobile sports betting out of tribal land.

On the flip side, states like Michigan and Connecticut allow tribal gaming operators to offer sports betting services to the entire state. For Michigan’s case, tribal casino operators can even acquire a state license to offer online sports betting.

A similar bill had been filed in December 2019 by Anthony Brindisi when he served as the US Representative for New York’s 22nd congressional district (2019 – 2021). But then, the bill failed to get enough traction by the time the congressional session ended that month.