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New Florida Gambling Deal Encounters Several Issues

Ryan KnuppelBy Ryan Knuppel

The state of Florida and the Seminole tribe are actively taking part in negotiations over what has been a couple of years of disagreement. The Sunshine State and the Native American tribe—which is one of the most successful organizations in the casino industry—have been on the opposing sides when it comes to the tribe’s casinos. Governor Ron DeSantis decided to be a mediator between the two warring sides who are required to make a new gambling deal and sort things out.

The legislative session between Florida and the Seminoles has a deadline, and it should be in two weeks, but the two sides have encountered a couple of issues regarding sports betting and table games that may become an obstacle to reaching an agreement. DeSantis expressed his skepticism as well, as he stated that he did not like some of the provisions made in the deal. He added that he would like to ‘get a deal’ as soon as possible, but that he would like to do everything that was right for Florida.

It has been several years now since the state and the officials of the tribe started arguing and failing to sign a new gambling-related contract. The first agreement between the two sides was reached back in 2010 but all the key terms were set to last five years. In other words, the key terms expired in 2015 when the revenue to the state was put in danger.

The former Governor of Florida, Rick Scott, had a temporary solution at hand. The two sides reached a temporary agreement that allowed the tribe to hold exclusive rights on blackjack in exchange for millions in shared revenue from this game. Once again, it was just a temporary solution, and it seems that the real solution was nowhere near. This one will expire on May 31 when things can get quite complicated unless there is a deal in sight. If the two sides do not manage to reach a deal, the state risks losing more than $350 million in gaming revenue.

One of the Problems is Sports Betting

Many reports reveal that the outline of the draft that Gov. DeSantis and his team currently review included sports betting authorization in the state. The Seminoles would act as sort of a hub for placing bets at pari-mutuels in Florida. According to the provision, in-play betting would also be authorized at professional sports venues. However, Gov. DeSantis believes that this could affect games’ integrity, and he doesn’t seem too happy about it. Furthermore, he stated that he must consider in-play betting and whether it should be limited only to sports arenas or be legalized across the state.

Long story short, the Governor has not really ‘put forth opposition’ to the idea of gambling on sports in this state, but that he is willing to further discuss this idea with both sides.

The Problem With Card Games

Card games have been one of the main reasons for disagreement between the two sides, and the draft suggests a possible new deal that proposes a drastic change in the way card games are played at pari-mutuels. This change will make the game entirely unprofitable for pari-mutuels of the state. Furthermore, these facilities will be allowed to run operations related to sports betting but the revenues made from wagering will have to be shared with the Seminoles.

All in all, the lawmakers of the state will receive up to $400 million annually from the Seminoles, with potential to go up to $500 million. This is certainly an improvement, compared to $350 they paid to the state, but the lawmakers believe they could have done a much better job here.

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Seminole Tribe and Florida Officials to Discuss New Compacts

Ryan KnuppelBy Ryan Knuppel

The lawmakers of Florida and the Seminole Tribe have been in strong disagreement over a key provision when it comes to a former compact related to gambling that has expired five years ago. The two sides definitely needed to sit down and talk about new compacts, and it seems that the solution is actually closer than we might think. The resolution is out there, and the new compact would probably include provision expansion in Florida.

According to their previous compact, which became active back in 2010, the Seminole tribe owned an agreement about revenue sharing. In other words, part of their revenue would go to the state of Florida, which means that the Seminole tribe basically paid hundreds of millions of dollars directly into the coffers of the Sunshine State. The compact had to be renewed in 2015, which was pretty difficult since both sides were unable to reach an agreement. Governor Rick Scott somehow managed to convince the Seminole tribe to renew their compact, despite the fact that they were not really content with it. Therefore, their revenue sharing agreement continued to live on while the two sides were searching for some better options in order to create an equilibrium where they are both happy.

Therefore, the loose agreement that they came upon in 2015 will expire in May, and they are bound to come up with a new one sooner or later. This fact alone will cause the loss of up to $350 million in 2019, and the Senate has already imposed high taxes in order to secure the state budget, should they do not reach an agreement with the tribe.

One of the main reasons why such an agreement was not possible in the past is that the tribe claims that the state has violated previous compacts. In fact, 2016 was pretty much a turbulent year for the Seminoles tribe which took the state of Florida to court claiming that Florida officials were not allowed to introduce blackjack at pari-mutuel tracks, as Seminoles had an exclusive right to this card game. The court actually agreed on this and sided with the Seminoles. This escalated in a full-time hatred between the two sides, with Seminoles threatening to put an end to the revenue-shared system which would severely affect Florida’s budget. All of this tension was later approached by Scott who made both sides cooperate once again, making a short term deal which would expire soon.

Both sides are quite aware of this fact which is the reason why they sat down last week trying to figure out everything and come up with a deal that would be beneficial for both sides. Senator Wilton Simpson is the one who is currently leading the discussions as the two sides have a very tight deadline that they must not cross. In other words, we will have an opportunity to hear the news about a potential agreement very soon, as days, if not hours, are left for them to complete their talks.

Florida has been pretty active when it comes to gambling, as voters decided in a poll that they should be the ones in charge when it comes to controlling gambling in the state. A ballot in November 2018 put all activities related to gambling in the hands of the residents of Florida who will also decide on things such as expansions. On the other hand, many officials of Florida, including Governor Ron DeSantis, do not feel like giving the Seminole tribe more autonomy when it comes to gambling. In other words, this fight might be far from over.