Arizona state Rep. Mark Finchem is rejecting the results of gaming compact renegotiations between Governor Doug Ducey and the state’s gaming tribes.
Among other things, the new compacts would legalize sports betting, keno and fantasy sports. Finchem says Ducey acted outside his authority, as gaming policy is “a quintessential legislative function.” He’s asked Attorney General Mark Brnovich for a legal opinion.
Ducey introduced the subject at his State of the State address when he spoke of, “an opportunity for a modernized gaming compact that will bring in more revenue for our tribal nations and our state budget.”
Ducey acknowledges that he needs the legislature’s approval for his compact deals. If the Attorney General were to rule against the governor, however, it would also nullify his promise to the tribes that they can have off-reservation gaming.
The governor’s office said he believes the original 20-year compacts dating back to 2002 spell out that the governor can negotiate amended compacts.
Those compacts gave the tribes exclusive rights to some casino games in exchange for revenue sharing, excepting some gaming already in place at the time, such as horseracing and the lottery. If the state were to start a new form of gaming, the tribes would no longer have to share their revenues or keep a cap of the number of slot machines.
Ducey and the tribes have negotiated the new compacts for more than year. He has argued for the necessity of modernizing the pacts. As a result, the new agreements allow for craps and roulette and give the tribes the right to operate casinos off the reservation. In return, they agreed to allowing sports betting, keno and fantasy sports without a tribal monopoly.
Finchem wrote Brnovich, “Formulating gaming policy is … not embedded in the governor’s constitutionally conferred executive powers. The governor is afforded only limited authority to negotiate on discrete and largely ancillary contract terms. Nothing in the statute empowers the governor to single-handedly forge the terms of a new compact that materially diverges from or expanded upon the terms specifically prescribed in (law).”
On the other hand, if Finchem is wrong, Arizona could become among the first state this year to legalize sports betting. Among other states also considering legislation is Kansas, which could vote on it in the next week or two.
Both Arizona chambers have taken up similar bills that would allow up to 10 online and retail sportsbook licenses for tribes and up to 10 for venues that include racetracks. But in a unique twist, sports franchises such as the Arizona Cardinals and Phoenix Coyotes and even the Phoenix Raceway could also offers sportsbook.
Fuming because they have been left out are associations representing bars and taverns, which are already at a disadvantage because they are operating under Covid-19 restrictions.
The Arizona House Commerce Committee, which is tasked with the bill voted to move it forward after testimony by some of the teams and tribal representatives.
It also heard from the bar representatives. David Delos, president of the Arizona Licensed Beverage Association, told the committee: “How can it be that in Arizona that only the big players seem to benefit while small businesses operating with restrictions and being asked to operate under reduced capacity for the foreseeable future are not even mentioned in this bill.”
After hearing the testimony eight representatives voted to advance the bill but said they wanted to see bars and possibly restaurants included in future iterations.
The bill is supported by most sports franchise, BetMGM and a number of tribes.
Amilyn Pierce of the Arizona Diamondbacks declared, “We cannot allow Arizona to fall behind, putting our sports teams at a significant disadvantage in a competitive market.”
