Seminole Tribe Deal Could Deliver
Fatal Blow to Pari-mutuels

Las Vegas looking to hone in on the action,
as state continues to hedge bets on gambling expansion

By Alex Tiegen
© 2010 Sunshine State News
Friday, March 12, 2010

A successful bid by the Seminole Tribe of Florida to gain a stranglehold on casino-style gambling in Florida for decades to come has exposed the state pari-mutuel industry to a world of threats that could imperil its future, industry spokespersons say.

The pari-mutuels also face a potential threat from casino resorts. One resort company on Thursday pitched the state House Select Committee on Indian Compact Review to let Las Vegas-style casinos set up in Florida.

But, the greatest threat may come from within the pari-mutuel community itself, which includes dog and horse racing, Jai-Alai and card room operations.

“There’s no unity,” said Jack Cory, who lobbies for the Florida Greyhound Association and the National Greyhound Association.

In-fighting and competition have long plagued the pari-mutuel community, and the family disagreements are proving troublesome as competitors gain bargaining chips in the Legislature, said those who represent pari-mutuels and the industries reliant upon them.

Gambling is big in Florida, with the expansion. About $1.1 billion was wagered through horse racing, greyhounds and Jai-Alai in fiscal 2009, according to the Spectrum Gaming Group, an independent international gaming research firm. Card and poker rooms produced $102 million in revenues, with Florida raking in $10.9 million in gaming taxes and table fees. Slot machine action in Florida fetched $2.7 billion in total handle, $208 million in revenue and paid $104 million to the state. The same year, the state lottery raised $4 billion through ticket sales.

Las Vegas Sands, which manages resort casinos in the United States and several other countries, proposed Thursday to the House Select Committee on Seminole Indian Compact Review a plan to establish at least four “integrated resort destinations” in Florida. The destinations would reserve no more than 10 percent of their floor to casino-style games. The resort would also include a convention center and hotel.

Andy Abboud, a Sands vice president, urged the committee to implement a process that would allow the companies to bid for gambling rights.

“Florida has an incredible opportunity to add to an incredibly strong existing infrastructure in tourism,” he said.

Amy Baker, coordinator of the state Office of Economic and Demographic Research, said at the meeting that if the state were to auction out gambling licenses, it could issue eight and receive more money than it would receive for the Seminole Compact, although there would be no receipts in the first year.

Rep. Alan Hayes, R-Umatilla, pointed out that Abboud was ignoring the casino resort’s effects on the state's pari-mutuels, who are battling among themselves and with the Seminole's over their excusive right to operate banked card games for up to 25 years.

Gov. Charlie Crist signed an agreement with the Seminoles in 2007 to give them the rights to blackjack and other banked card games at all seven of their state casinos.

The Florida Supreme Court struck down the deal, however, saying it was unconstitutional unless the Legislature approved it.

Crist's newest proposal, reached with the Seminoles last summer, once again puts blackjack in all of the tribe's casinos, despite the Legislature‘s preference to limit the games to four casinos.

The new deal was opposed by pari-mutuels, and the select committee struck it down early this year. The Seminoles are currently in private negotiations with House leaders, including Rep. Bill Galvano, R-Bradenton, with the aim of getting a bill through the Legislature before the end of the session

In the meantime, a proposed Senate compact would give four Seminole casinos in Hillsborough and Broward Counties exclusive rights to banked card games and the state’s seven casinos rights to slot machines. In return, the state would receive $150 million annually from the Seminoles.

If the Governor does not make a compact complying with the bill’s terms in 60 days, pari-mutuels outside Miami-Dade and Broward Counties would be able to offer slot machines only. Slot machines in pari-mutuels in those two counties are provided for in the state statutes. Electronic gaming, banked card games, intrastate internet poker, and roulette and craps could be offered at any state pari-mutuel if approved by countywide referendum.

Marc Dunbar, attorney for Gulfstream Park race track and casino in Hallandale Beach, said the Sands proposal would prove disastrous for pari-mutuels, although large companies like Gulfstream would likely survive.

“You could pretty much wipe out pari-mutuels in the state,” he said.

Cory said the state pari-mutuels could have banded together years ago to prevent a corporation like Sands from shutting them out. Their disputes prevented them from acting, however. Not only are pari-mutuels divided, they are divided by industry and region, he said.

“The pari-mutuels are fiddling while Rome is burning.”

Dunbar said he believes that Florida should have a statewide pari-mutuel association that would provide the various operations with a unified voice. In lieu of that, it needs a strong legislative leader to back it up. And, the last time the pari-mutuels had that was when Toni Jennings was Senate president a decade ago, he said.

He said that the state pari-mutuels are so intent in acting in their own individual interests that they don’t work for the common good of the industry.

“It adversely affects our credibility when we fight each other,” he said.

One point they have divided over in the Seminole gaming compact is the issue of allowing electronic gaming and slots in pari-mutuels only if approved by countywide referendums. The proposed Senate compact includes such a provision.

Richard Gentry, a lobbyist for Hamilton Jai-Alai and Poker and Pensacola Greyhound Track, said the referendum idea is a definite stumbling block.

“It’s much harder to get that kind of a vote in North Florida,” he said.

Gentry said South Floridians are much more likely to pass such a referendum than North Florida. If pari-mutuels are not given rights to electronic gaming, he said, gamblers will cross state lines to find it.

Cory and Dunbar said that the referendum requirement is virtually inescapable. Cory said North Florida pari-mutuels should advocate more for themselves, while Dunbar points out that Gulfstream itself had to go through the referendum process.

"With this Legislature, it's a fact of life," he said.

Galvano, who is leading negotiations with the Seminoles, believes the pari-mutuels are currently cooperating better than he has ever seen them. But, there is still divisiveness.

“It’s as smooth as it can be, I think” he said. “But, I don’t think it’s an absolute chorus.”