A problem of sorts percolates in Colorado. The problem of sorts involves state tax revenue, water conservation and the Ute tribes. And online sports betting. And might involve casinos in the small tourist towns in the mountains.
It starts off with the Southern Ute and Ute Mountain Ute tribes wishing to add online sports wagers to their casinos, like those available in Black Hawk, Central City and Cripple Creek. Now it gets complicated. The state and by extension, the water people, fear if the Ute get their wish, tax revenue would be spirited away from water resources.
Keep a couple of things in mind:
The tribes are sovereign nations not subject to Colorado laws or taxes.
The tribes cannot proceed with their proposal without state approval.
Lawmakers introduced House Bill 1436, in November, a proposition which will ask voters to permit the state to keep more of the tax revenue produced by sports betting. The state could pick up $34.2 million in the coming fiscal year.
Current law caps state revenue at $29 million, but the cap would go away should voters approve the proposition.
The tribes have been denied participation so far, said Peter Ortego, a lawyer who represents the Ute Mountain Ute tribe.
Taxation is at the heart of the impasse. As sovereign nations, the tribes are exempt from paying state taxes. For the state, that poses a problem. For example, if tribes permitted other commercial gaming companies to locate sports wagering kiosks on tribal land, they would be exempt from paying taxes, as well. With less revenue, water programs such as conservation, habitat restoration, stream protection and planning and storage would likely suffer, according to Rep. Dylan Roberts.
“When the legislature referred the sports betting initiative to voters in 2019, a key part was the state collecting tax on the revenues and dedicating 90 percent of that money to water projects,” Roberts told the Colorado Sun. “Now there is a concern that if the physical locations moved to tribal lands, we would lose most of the funding for water.”
Lawmakers will likely meet later in the summer to discuss the impasse.
“I would be open to finding a middle ground. The complication is that tribal lands are not subject to state law, so lawmakers have very little ability to work in that space,” Roberts said.
Previous attempts to break the standoff have failed. The Ute Mountain Ute’s Ortego said it’s not clear when—or if—the dispute will be resolved.
“We want the opportunity to do what every other casino in the state is allowed to do,” Ortego told the Sun. “And we believe we have the right to do so.”
