California Small Business Organizations Announce Opposition to the Eligible Tribal Gaming Initiative

Measure will Cause $5.5 Billion in Lost Economic Activity for California Communities and $500 Million in Lost Tax Revenues

SACRAMENTO, Calif. April 6, 2022 – Small business organizations and the thousands of small businesses they represent across California today announced their opposition to the qualified tribal gaming initiative – the only sports betting measure being contemplated for the November 2022 ballot that harms local communities and small businesses. Groups include Asian Industry B2B, Bell Gardens Association of Merchants and Commerce, California Black Chamber of Commerce, California Black Exposition, California Hispanic Chambers of Commerce, California Hmong Chamber of Commerce, Central Valley Business Federation, Garden Valley Chamber of Commerce, Industry Business Council, La Cañada Flintridge Chamber of Commerce, Los Angeles County Business Federation and Pro Small Biz California. 

“Small business owners across California agree: the qualified tribal gaming initiative will create a gaming monopoly that benefits a select few large casino owners, at the expense of small enterprise that drives the state’s economic engine. This initiative encourages abusive litigation that hurts locally owned and operated businesses, widens California’s opportunity gap, and threatens hundreds of millions of dollars in much-needed tax revenues to enrich a small handful of individuals.”

Tracy Hernandez, Founding CEO of the Los Angeles County Business Federation (BizFed)

This is the only gaming initiative that proposes to amend the State Constitution to guarantee tribal casinos a near monopoly on all gaming in California by expanding and weaponizing the Private Attorneys General Act so it can be used against tribal casino operators’ legally-operating competition. 

Specifically, this change in the State Constitution allows tribal casinos to hire private trial lawyers and replace the role of the Attorney General to sue their non-tribal competitors. As a result, the measure puts more than 32,000 jobs, $1.6 billion in wages, and $5.5 billion in total economic impact at risk. Cities rely on these revenues for resident services such as public safety, housing and homeless programs.

“We oppose the eligible gaming initiative because it takes away opportunities for entrepreneurship and jobs that uplift and empower thousands of Californians. This initiative encourages possible lawsuit abuse to the detriment of the entire business community and is the only measure that takes away the opportunity and the ability to generate revenue to support our communities.”

Jay King, President, California Black Chamber of Commerce

“We are seriously concerned about Proposition 26 as it ignores the animal safety record and instead gives the horseracing industry a new funding stream in the form of millions of dollars. We encourage voters to reject Prop 26.”

-Dr. Gary Weitzman, President and CEO at San Diego Humane Society.

“Asian communities and small businesses would suffer severely under this initiative. It places in jeopardy 32,000 jobs held by many Asian Americans.”

Marc Ang, Founding President, Asian B2B

“The Hispanic business community stands opposed to what is a direct attack on our communities. This is the only tribal gaming initiative that threatens the livelihoods and small businesses of thousands of Californians simply working hard to provide for their families and get ahead.”

Julian Cañete, President and CEO, California Hispanic Chambers of Commerce

BACKGROUND ON THE MEASURE:

It threatens to destroy local jobs. The eligible tribal gaming measure changes the Constitution and sets a dangerous precedent that could result in the loss of tens of thousands of quality jobs in minority communities. Tribal casinos have a history of unsuccessfully challenging the legality of local cardrooms. Now, they’re taking it a step too far by exploiting the Private Attorneys General Act (PAGA) that was originally meant to protect workers. The measure expands PAGA into new territory by allowing tribal casinos to sue their competitors — forcing cardrooms out of business with unlimited, meritless lawsuits. Local communities will lose more than 32,000 good-paying jobs that generate $1.6 billion in wages annually. 

It deprives local governments of revenue for vital services. The eligible tribal gaming measure contains a poison pill for local cardrooms, which are a significant source of tax revenue and economic activity for many local governments. The measure will force cardrooms out of business and result in a loss of $500 million in local tax revenue statewide — meaning fewer funds for public health, homelessness services, senior centers, and after-school programs. California and local communities will lose $5.6 billion in economic output generated by cardrooms.