State Sells Out Pari-Mutuals!

Florida's billion-dollar gambling compact
with Seminoles moves one step closer to law

By Brent Kallestad
The Associated Press
© 2010 Palm Beach Post Times
Friday, April 09, 2010

A gaming compact with the Florida Seminole Indian Tribe moved closer to fruition today when a House panel approved an agreement that guarantees the state nearly $1.3 billion over the next five years.

The measure — which a former lawmaker called the biggest expansion in gambling without a voter referendum — still needs to win passage in the full House and the Florida Senate, which debated it on the floor today. The full House could take up the bill as early as Tuesday while the Senate could take final action on it next Thursday.

Gov. Charlie Crist has already said he'll sign the measure — which must also be approved by the U.S. Department of Interior — once it has won legislative approval. The Seminole tribal council unanimously approved it Wednesday.

Crist, who has twice signed compacts and strongly backs this agreement, had considered sitting in on today's meeting of the House Select Committee on Seminole Indian Compact Review.

"I thought they were going to handle it just fine on their own," Crist said about his decision to skip the two-hour session. "It looked pretty good to me."

The committee, however, heard some sharp criticism prior to its vote.

"It's the biggest expansion of gambling in this state without the people being involved," said Ken Plante, a former legislator and veteran lobbyist who represents Tampa Bay Downs.

Many lawmakers expressed their concern about how the compact could hurt pari-mutuels and others voiced concern about gambling addictions and more crime, but still voted to ratify the proposal.

"This is a losing bet," said William Bunkley, who represented the Florida Baptist Convention. "A classic case of fool's gold."

The 20-year agreement gives the tribe exclusive operation of blackjack at three casinos in Broward County and casinos in Immokalee and Tampa. All seven tribe casinos in Florida would continue to operate Las Vegas-style slot machines. Craps tables and roulette games are not included.

And the benefit begins immediately. Once Crist signs the measure into law roughly $435 million is freed up to help lawmakers meet immediate budget needs although the governor is unlikely to see it designated for education per his wishes. Another $12.5 million a month will drift into the state's cash-starved bank account beginning in July.

"This is a very reasonable approach," said Rep. Bill Galvano, a Bradenton Republican who chaired the House panel reviewing the compact. "It carries with it a significant benefit for the future."


A lot of money for a lot of gambling

An Editorial
© 2010 The Tampa Tribune
Friday, April 09, 2010

Nearly three years ago Gov. Charlie Crist made a compact with the Seminole Tribe of Florida that would give taxpayers a cut of gambling profits while, at the same time, preventing the spread of new casinos. The Florida Supreme Court killed the deal.

Last year, the governor completed a second agreement, but the state House of Representatives balked.

But this week the governor, tribe and legislators agreed upon a third compact that will aid the state in hard economic times. It will raise more than $1 billion the next five years, money that the governor would like to go to education.

The downside to the deal is that the gambling camel's nose is now well under the tent, and no one should be surprised to see Vegas developers clamoring to enter the Sunshine State five years hence.

Most Floridians would prefer to see no expansion of gambling. But the state is beyond that now. We've had a lottery for a quarter-century. There are parimutuel dog and horse racing, jai alai frontons, offshore gambling and now slot machines and card games.

Crist can't be blamed for putting together a deal that guarantees the state something instead of nothing.

The expansion of gambling wasn't Crist's idea. Under most interpretations of federal law, whatever gambling a state allows anywhere must also be allowed on federal Indian reservations.

Voters statewide unfortunately gave Broward and Miami-Dade counties the local option of adding slot machines to parimutuel sites. The Seminoles demanded equal treatment.

The governor negotiated an agreement giving the tribes the right to conduct table card games that would be illegal elsewhere in Florida. The state Supreme Court, however, said the governor lacked the power "to bind the state to a compact that violates Florida law."

So the governor negotiated again, but parimutuel and anti-gambling interests prevailed in the House to defeat the compact.

This year, however, with the state facing a $3.2 billion budget shortfall and Vegas-style card games already in Seminole casinos, and with no authority, either federal or state, willing to challenge the games, lawmakers sealed the deal to make sure the state treasury gets a fair share of the take.

The deal gives five of seven casinos, including the Seminole Hard Rock Casino in Tampa, exclusive rights to blackjack, baccarat and chemin de fer. It also allows the exclusive operation of Las Vegas-style slot machines at four Seminole casinos outside Miami-Dade and Broward counties.

The parimutuels will be able to offer round-the-clock poker games with no limits, and they get a dramatically lower tax rate than they now pay.

You can be sure the gambling industry will push hard for expansion outside the Indian reservations once the terms of the agreement expire. But the state has five years to devise a strategy for keeping gambling in check.

Unfortunately, the billion in extra money doesn't solve the state's underlying problem. Florida simply can't run forever without raising new revenue. No one wants higher taxes, but neither does anyone wish to do away with essential and special services the government has promised Floridians. Fewer taxes, smaller government and more freedom is a wise guiding premise, but it should not preclude lawmakers from considering sensible ways to meet government obligations, such as closing sales-tax exemptions and collecting sales tax on Internet sales.

Simply cutting programs and raiding trust funds to balance the budget is not good government.

This compact will ease the state's financial woes. Given the circumstances, it represents a reasonable compromise.

But gambling's illusionary promise of prosperity offers no budget solutions to either citizens or lawmakers.


Seminole Gambling Deal Flies Through House Panel

By John Kennedy
The News Service of Florida
© 2009 FCTA
Thursday, April 08, 2010

THE CAPITAL, TALLAHASSEE: Florida’s proposed $1 billion gambling deal with the Seminole Tribe easily cleared a House committee Thursday, as an only-in-Tallahassee coalition of religious conservatives and rival horse-and dog -tracks failed to gather enough muscle to derail the budget-rescue plan.

With the 15-3 vote by a select committee that’s been working the proposed compact, it looks virtually certain the tribal agreement will clear a Legislature eager to spend the $437.5 million it brings into the recession-battered budget.

Committee Chairman Bill Galvano, R-Bradenton, acknowledged there wasn’t enough opposition to block the latest version of the compact – which has been labored over by Gov. Charlie Crist and lawmakers for three years.

“Anyone who takes the time to look at the document…has to recognize that this is a very reasonable approach,” Galvano said.

The only votes against the measure: Rep. Alan Hays, R-Umatilla, Rep. Mary Brandenburg, D-West Palm Beach, and Rep. Sandy Adams, R-Orlando.

The deal gives the tribe exclusive rights to run three table card games – blackjack, baccarat and chemin de fer – at five of its seven Florida casinos and Las Vegas-style slot machines at the four Seminole casinos outside Miami-Dade and Broward counties.

The tribe will pay the state $1 billion the next five years for the deal. But combining first-year payments with Seminole money escrowed by the state the past three years brings the amount available to lawmakers this spring to the $437.5 million level.

Galvano called the cash flowing into the state from the deal “unprecedented” compared to Indian compacts in other states.

The proposal also seeks to blunt longstanding criticism from Florida pari-mutuels by lowering the tax rate for horse- and dog-tracks and jai-alai frontons in Miami-Dade and Broward from 50 percent to 35 percent, returning to roughly the rate in place before voters approved slot-machines in those county pari-mutuels.

Tracks and frontons statewide also would gain expanded hours and higher betting limits for the card rooms that have helped sustain the industry even as horse- and dog-bettors dwindle.

But while the deal allows the state’s 19 pari-mutuels outside Miami-Dade and Broward to bring in 350 bingo-style machines, video lottery machines and historic racing machines, these facilities form the bulk of the opposition to the compact.

Ken Plante, lobbyist for Tampa Bay Downs horse track, blistered the select committee Thursday for approving the state’s “biggest expansion of gambling” in history. He said the move deserves a statewide referendum since it “will probably put the pari-mutuels out of business.”

Plante and others representing tracks and frontons outside South Florida are pushing hard to gain tax incentives similar to those given the Miami-Dade and Broward facilities, but concede it’s a long-shot this session.

The deal even shoulders the Florida Lottery out of its plan to buy another 750 instant ticket vending machines, with the tribe apparently uneasy about the heightened competition. The measure had already cleared the Senate’s Ways and Means Committee, but looks likely to languish if the compact advances, as expected.

If county voters outside Miami-Dade and Broward were ever to approve introducing slot-machines at pari-mutuels, the compact payments to the state would stop.

Rep. Jim Waldman, D-Coconut Creek, countered comments by several committee members, who conceded they were reluctantly supporting the compact, saying, “I don’t vote for this with a heavy heart. I think we’ve done a tremendous job for the people of Florida.”

He added, “For a few card games, (Seminoles) are paying us a billion dollars.”

Joining pari-mutuel critics, religious conservatives and those concerned about gambling addictions also weighed-in against the compact Thursday.

Bill Bunkley, lobbyist for the Florida Baptist Convention, disputed the characterization that the compact did not expand gambling – but merely codified activities ongoing in Florida. Bunkley said promises of the tribe paying $1 billion to the state over the next five years doesn’t jibe with that claim.

“Simple math is simple math,” Bunkley said, adding, the deal will only further fuel more demands from existing pari-mutuels who feel they are at a competitive disadvantage.

“There is a time to stop it if you can,” Bunkley told the committee. “We will have the same debate on parity over and over and over again.”

Supporters of forging a compact had, in previous years, repeatedly said the compact money flowing to the state had long been earmarked for education. But that’s off the books now.

Sen. Dennis Jones, R-Seminole, acknowledged the change Thursday when the measure (CS/SB 622) advanced through the Senate on way to a final vote, likely late next week. The House also is expected to position the measure Tuesday for a vote.

“We can lessen the pain in all the programs and projects….but, hopefully, the majority will go to education,” Jones said.

Jones also conceded the proposed compact left many of those tied to pari-mutuels unhappy.

“I think there’s a lot of things in this bill will help the pari-mutuel industry,” Jones said. “But obviously, they don’t have everything they want.”