As part of its recent settlement with the state of Arizona, the Yavapai-Prescott Indian Tribe will be able to join the more than 20 other state tribes offering retail sports betting.
The tribe, which did not sign onto the 2021 Gaming Compact legalizing sports betting in Arizona and additional table games, reached a settlement with the state in August after a yearlong legal battle over wagering and its impacts on tribal gaming exclusivity.
BetArizona.com obtained a copy of the settlement between the two sides this week through a public records request. As part of the settlement, both the state and tribe agreed to pay their own attorneys’ fees, with neither side admitting liability.
Brendan Bussmann, who is the managing partner of the gaming consulting firm B Global, told BetArizona.com in an email the settlement allows the Prescott-based tribe to offer the same gaming options as their tribal brethren.
According to the settlement, the YPIT and state’s new agreement is “virtually identical in substance and form” to the 2021 Compact and to the 2022 Compact, which addressed technical issues that had arisen since the 2021 Compact was signed.
But the YPIT's settlement doesn’t include an Arizona sports betting apps license. The state has handed out 18 mobile licenses, with 10 going to Indian tribes. The other eight — and two more yet to be given out — are reserved for professional sports teams in the state.
“Based upon the settlement, it appears as though both parties have agreed to move forward under a similar structure as the other 20 tribes in Arizona,” Bussmann said. “One of the challenges to this market is that you still have tribes that have a desire to operate (mobile) sports betting in the state. I’ve been an advocate of this since the first draft of the legislation a number of years ago, but don’t see anything changing in the short term."
What the Arizona Sports Betting Settlement Entails
The main thing the settlement between the state of Arizona and the tribe entails is a waiver of any claims or demands, while also ending the threat of exercising the “poison pill” provision in earlier compacts.
According to the settlement, the YPIT filed notice with the state in August 2021 — a month before sports betting began — that it was invoking the “poison pill” provision included in the 2003 Gaming Compact. That provision would allow tribes to operate unlimited Class III gaming devices and table games at a lower tax rate if the state were to permit an entity other than an Indian tribe to operate gaming devices.
The 2021 Gaming Compact allowed tribes to add sports wagering and five other casino games, greatly increased the device limit for each tribal casino and drastically lowered the tax rate for all tribal casinos operating outside the Phoenix metro area.
The YPIT settlement, which was signed by a Maricopa County Superior Court judge on July 27, had been in the works for months, including a lengthy review by the U.S. Department of the Interior.
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What the Settlement Means for the Future
The tribe’s original lawsuit was filed in August 2021. A judge ruled against the YPIT on Labor Day, and the tribe filled an amended complaint in late September 2021. Since then, the case has had five extensions as the sides worked on a settlement.
While the YPIT doesn’t seem to have received more in the settlement than it would have gotten by signing onto the 2021 Gaming Compact originally, the agreement allows peace of mind for the state according to Derrick Beetso, the director of Arizona State University’s College of Law Indian Gaming and Self Governance Programs.
“The recent 2022 compact amendments are described as technical in nature and likely address concerns raised during this litigation” Beetso said. “Importantly, the settlement is clear that neither side admits any liability or fault, and that all claims related to the substance of this litigation are waived.
“These were substantive conditions agreed upon in order to avoid the costs and uncertainty of future litigation, according to the settlement. Essentially, this means the state, with respect to Indian tribes, can move forward with its event wagering framework free from any pending litigation or challenges.”
