High-stakes decisions on sweeping prohibitions were put on hold until the end of the month due to a California bill that could change the state’s digital gaming landscape. Assembly Bill 831, which aims to outlaw online sports betting and sweepstakes casinos, was placed in the suspense file of the state Senate Appropriations Committee, postponing a crucial vote and casting doubt on the future of numerous gaming businesses.

The “dual currency” model employed by online sweepstakes cafes, an industry that has grown in a legal limbo, is the focus of the bill, which has seen numerous revisions since it was first introduced. Some Californians continue to look for regulated digital gaming options through platforms that operate in other jurisdictions while the legislative process is still ongoing.

The bill’s author, Assemblymember Avelino Valencia, argues that a state-level crackdown of this kind is still necessary to provide comprehensive consumer protection against unregulated and potentially predatory operators.

Steven Brown’s analysis of online casinos in California highlights that, for those navigating this complicated landscape, playing on offshore platforms licensed by countries such as Malta, Curaçao, or Gibraltar is currently the only legal option available to Californians. These websites stand out due to their 256-bit SSL encryption for data security, collaborations with audited payment processors such as Skrill and Trustly, and a track record of respecting player agreements. These are all important indicators that distinguish trustworthy operators from dishonest sweepstakes models. 

A common but crucial procedural step for bills with significant fiscal effects—those that could cost the state’s general fund $50,000 or more—is moving them to the suspense file. Before determining whether to move the proposed ban to the Senate floor for a full vote by the deadline of August 29, lawmakers will now carefully consider the financial implications of the measure, balancing anticipated public benefits against possible enforcement costs.

Major Native American gaming organizations like the Yuhaaviatam of San Manuel Nation have expressed support for the proposal, which has sparked intense reactions throughout the state. However, other tribal coalitions and their business partners have sharply opposed it.

In a written argument submitted to lawmakers, CNIGA Chairman James Siva emphasized the stakes for tribal sovereignty, stating, “California voters granted tribes the exclusive right to conduct gaming in this state. That right and the will of the voters must be protected from illegal and unregulated gambling operations.” This stance was echoed by member tribes, including the Yuhaaviatam of San Manuel Nation, who argue that the proliferation of unregulated sweepstakes cafes “undermines the integrity of the state’s gaming compact system.”

This is not the case for all tribal entities. During Monday’s hearing, the Kletsel Economic Development Authority (KEDA), a federally chartered corporation of the Kletsel Dehe Wintun Nation that has partnered with sweeps operator VGW, expressed strong opposition.

“This bill lacks unanimous support among California tribes, has advanced without meaningful consultation with many of us, and threatens our inherent right to operate legitimate revenue streams to support our people,” testified Eric Wright, KEDA’s CEO. 

If passed, AB 831 would make it a misdemeanor for operators, punishable by fines ranging from $1,000 to $25,000 and up to a year in jail. Local governments and tribal gaming operators throughout the state, including those in the Tahoe basin, are keeping an eye on the outcome because changes in statewide gaming policy can have a direct impact on local economic vitality and tourism.

A decision determining the bill’s fate is expected from the Senate Appropriations Committee by August 25.