The odds have increased for a legislative compromise to update Florida’s gaming laws, one that would guarantee the state more money from the Seminole Tribe in exchange for adding craps and roulette to their casinos, according to negotiators for both sides.
The tribe has some new leverage since legislation emerged and died last year: a federal court order allows it to stop about $250 million in annual revenue-sharing payments to the state by the end of March if a dispute remains over “designated player games” operated by some card rooms across the state, and a “no casinos” constitutional amendment is before voters in November that could strip lawmakers of any ability to expand gambling without voter approval.
But two significant hurdles stand in the way of an easy resolution.
Number one: Jeff Soffer, owner of the Fontainebleau Resort in Miami Beach, has launched an aggressive new push to transfer the casino license from Mardi Gras Casino and Racetrack in Hallandale Beach to another site in Miami Beach or elsewhere in Broward. Soffer, CEO of Turnberry Associates, is in talks to purchase Mardi Gras Casino and Race Track in Hallandale Beach and he’s hired Michael Corcoran, the brother of House Speaker Richard Corcoran, as one of his lead lobbyists.
Related: ”Fontainebleau owner Jeff Soffer buying Mardi Gras casino in Hallandale Beach”
Corcoran, R-Land O’Lakes, denies that his lobbyist brother holds any sway over him, but that’s not the perception of many lawmakers or many in the lobbying corps in Tallahassee.
Number two:The dynamics have changed this year with Senate President Joe Negron, R-Stuart, and many leaders from both parties wanting to support the eight counties where voters have approved bringing slot machines to their pari-mutuels. The Florida Supreme Court ruled they are not authorized to install the games without legislative approval.
The Florida Legislature’s top negotiators on the issue, Sen. Bill Galvano, R-Bradenton, and Rep. Jose Oliva, R-Miami Lakes, met recently with the Seminoles, at which time an extension of the March date for discontinuing the payments to the state was discussed, said Barry Richard, lawyer for the tribe.
“The tribe, on the other hand, would like the Legislature to do something to give them assurance they are not granting an extension for nothing,’’ Richard told the Herald-Times.
The Senate Appropriations Subcommittee on Finance and Tax on Monday unanimously approved the Senate’s latest offer to the tribe. SB 840 would renew the 2010 gaming compact between the state and the tribe, but allow them to add craps and roulette at its Hard Rock casinos in Tampa and Hollywood, and its five other casinos around the state, in exchange for as much as $400 million in annual payments to the state — up from about $250 million now.
The Senate bill would also allow horse and dog tracks that have been conducting live events for the past five years to “decouple” and no longer operate the live events as a condition of their pari-mutuel permits. Casinos in Miami-Dade and Broward counties would have the tax rate reduced to 30 percent in 2018, and to 25 percent in 2019. Horse tracks that stop racing would have to make payments to the thoroughbred industry. The measure would also legalize the designated-player games used in some pari-mutual card rooms, which the tribe opposes, and clarify that certain fantasy sports contests are legal in Florida.
“With the ‘No Casino’ amendment on the ballot, and the likelihood of it passing, now more than ever, it’s crucial that we discuss a compact with the Florida House and the tribe,” said Sen. Travis Hutson, R-Palm Coast, the sponsor of the Senate gambling bill. “This could be our last possible chance to regulate gaming as a legislative body, and ... the fiscal implication is hundreds of millions of dollars a year.”
Sen. Kelli Stargel, a Lakeland Republican and chair of the committee, said that although she opposes gambling if legislators do nothing, the status quo will lead to an enormous loss of revenue to the state if the tribe stops payments in March “because we have not fixed their problem.”
The House has proposed a more modest gambling bill, (HB 223) authorizing the agreement the tribe made with the governor in 2016 and excluding fantasy sports games from state gambling regulations.
Galvano, who is expected to become Senate president next year, said the Senate’s proposal could change based on what the tribe agrees to give the state in revenue.
“My preference is to get what we can this year because the big constitutional amendment will curtail everything,” he said. “If we know what the revenue from the tribe looks like, and we can create some equity with the pari-mutuel community, and we can do that in the next four weeks, we’ll do it.”
The tribe, along with a Disney company, are the primary backers of the constitutional amendment, called the “Voter Control of Gambling Amendment,” that obtained the required number of signatures to be placed on the November ballot. Galvano, who says the gaming amendment will give the tribe a “monopoly” over gaming in the state, has called the referendum a “game changer.”
“If it passes, [it] will mean the Legislature is divested of control of this issue, leaving a monopoly for the Seminole Tribe, and their continued payments to the state of Florida in jeopardy,” Galvano told the News Service of Florida.
The Seminoles have been trying to get the Legislature to re-authorize their 2010 agreement with the state that gave the tribe “exclusive” rights to operate banked card games, such as blackjack, at most of its casinos in exchange for a minimum of $250 million each year. The agreement expired in 2015, but the tribe has continued to offer the games.
Galvano, a lawyer who has done real estate work for Soffer’s Turnberry Associates, said the proposal advanced last year by both the House and Senate to allow new casinos to open in Miami-Dade and Broward counties drew such criticism from heavy hitters in Miami that it killed progress on a gaming deal.
A letter signed by healthcare executive Mike Fernandez, developer Armando Codina and automobile mogul Norman Braman opposing a Miami casino had an effect, he said.
Richard said the tribe also opposes casino expansion in South Florida.
“The tribe would never agree to any new casinos in Miami-Dade and Broward,” he said. “They would never agree to shifting permits either, because [developer] Genting gets what it wants in Miami Beach and that’s right in the tribe’s back yard,” he said.
Galvano agreed that “the idea that they have competition out on the beach I think would break down our discussion.”
But he said he is more optimistic about other alternatives, such as requiring a voter referendum in the county that would house the new casino.
“Then, everybody is going to play in that referendum, from Disney to the tribe,” he said.
Galvano added that a new South Florida casino “has to be part of the discussion” because any new compact with the tribe will likely serve as the blueprint for the future of gaming in Florida “for the duration.”
“A lot of things that are non-starters could become a little more palatable under the right circumstances,’’ he said.
Richard also told the Herald/Times that referendums allowing counties to bring slot machines to their pari-mutuels “have no basis in law” and are not supported by the tribe. “Those counties don’t pay anything to the state. The tribe is paying twice as much as the pari-mutuels put together.”
But, he added, “what the Legislature will have to do is make the tribe an offer that makes economic sense.”
Meanwhile, the tribe has sued the state over the emergence of card rooms and pari-mutuels that it alleges compete with its monopoly-protected slot machines or banked card games. In 2016, federal court Judge Mark Walker sided with the tribe and ruled that the popular “designated player” card games offered by more than a dozen pari-mutuel card rooms were illegal.
The settlement agreement signed by state regulators at the Department of Business and Professional Regulation required them to take “aggressive enforcement action” against pari-mutuels that were violating the law in the way they conduct designated player games. But, under the agreement, the tribe may stop paying the state at the end of the month the Legislature ends its regular session, which would be March.