Florida casinos bill a catch-all, addressing the lottery,
dog tracks, jai-alai, and Internet cafes

By Dara Kam
Palm Beach Post Staff Writer
© The Pallm Beach Post
Tuesday, January 2, 2012

It's already tough enough to get conservative lawmakers behind the concept of three new casinos in Florida, no matter how swanky.

But the resorts' prospects may be even trickier now that a rewrite of the "destination resorts" bill overhauls all types of gambling in the state, from greyhound races to scratch-off lottery tickets.

Sen. Ellyn Bogdanoff, R-Fort Lauderdale, the bill's sponsor, recently released the latest version of the plan she says will rein in gambling. The Senate Regulated Industries Committee is slated to take up her bill during the first week of the legislative session, which begins Jan. 10.

Her original measure (SB 710) would create a statewide gambling commission and allow up to three casinos - whose operators promised to spend at least $2 billion each over five years on construction - to build upscale resorts in Miami-Dade and Broward counties.

But now all bets currently being wagered in Florida - at Internet cafes, poker tables and slot machines, as well as on horse and dog races - have been added to the mix.

Bogdanoff's latest plan would:

•Require voters in each county to approve new gambling of any type in that county, including the casinos proposed in South Florida; put an end to the prospects of barrel racing as an authorized form of quarter horse racing, except at a Panhandle track; and allow casinos to open anywhere in the state, as long as voters approve.

•Allow the existing pari-mutuels - including Palm Beach Kennel Club - to have slots, if voters approve. And, if voters sign off, the tracks could offer any kind of games played at the casinos, including blackjack, if they agreed to spend at least $100 million over three years to upgrade their facilities.

•Bar any new racetracks or jai-alai frontons from opening after July, do away with more than a dozen dormant pari-mutuel permits and have the state buy back four active permits, using proceeds from the casino licensing fees.

•Shut the door on at least 1,000 Internet cafes throughout the state, now largely unregulated and not considered under Florida law as betting games.

"I said we were going to stop the expansion," Bogdanoff said last week. "We're going to redirect it, but we're going to substantially reduce the number of gambling locations in the state of Florida. We're going to do everything we can in our power to reduce gaming, and I'm going to do everything I can to limit the lottery."

Bogdanoff made the changes as concessions to opponents of her casino bill who don't like her measure but wanted to address what some call loopholes in Florida law that allowed the owners of a small track in Gretna to get a pari-mutuel permit for barrel racing - the only one in the nation - and gave the green light for a new "racino" at Flagler Greyhound Track in Miami.

Special interests add risk

State regulators issued a summer jai-alai permit to Flagler, owned by Magic City Casino, allowing a new jai-alai fronton - and possibly slot machines - and a card room to open anywhere in the county.

Bogdanoff's bill also would shut down the summer jai-alai permits.

House Speaker Dean Cannon, R-Winter Park, recently called the casino bill "an uphill lift" because conservatives in the GOP-dominated House have typically shied away from measures they view as an expansion of gambling.

"Those tendencies get amplified in an election year," Cannon said. "Just given the tough budget year the budget shortfall, the complexities, that's just an uphill lift."

It's uncertain whether restraining existing gambling will ease its passage or weigh it down further.

"The more special interests you have, the more at risk you are," Bogdanoff conceded.

Her revised plan also addresses the "parity" the existing pari-mutuels in South Florida say they need to compete with any new casinos by allowing them to get the same games and lowering the current tax rates on slot machines from 35 percent to 18 percent, the same amount the proposed casinos would pay.

The measure, certain to morph again as it works its way through the legislature, puts Gov. Rick Scott in a bind.

The governor recently urged lawmakers to close the loopholes and clarify whether the Internet cafes are permissible.

"The most important thing is the law ought to be clear," Scott said. "Is it legal or is it not legal? There shouldn't be a gray area."

But he has remained on the fence about the casinos measure, saying only that he does not want a significant portion of the state's budget to rely on income generated by the resorts.

And, in contrast to Bogdanoff, he wants the state to sell more lottery tickets next year to boost spending for public schools.

Not a fan of the lottery

Bogdanoff, who maintains that the lottery is the most destructive form of gambling because it preys on people who can least afford to buy tickets, wants to do away with the state law that requires the lottery each year to come up with ways to sell more tickets.

"I do find some hypocrisy in people who are willing to expand the lottery while it's the most predatory form of gaming," she said. "The evidence shows it basically caters to and is more frequented by the poor. It's kind of ironic to me that we're willing to expand gaming on the backs of the poor but not on wealthy tourists from outside of the state and outside of the country."

Putting all the components into the omnibus bill would force Scott to give a thumbs-up - or down - to a conglomerate of gambling issues.

End patchwork of rules

Supporters of the measure believe Bogdanoff's approach is their best bet to get the controversial casinos bill approved.

"Not only do we feel it has better chances of being passed, but we think the overall law that Florida will create will end this continuous patchwork of gaming laws that have gotten us into this situation," said Nick Iarossi, a lobbyist representing Las Vegas Sands, a potential bidder for a casino license.

While a casino could be built anywhere, potential investors so far have focused on Miami-Dade or Broward counties, saying a $2 billion investment anywhere else in the state would not be profitable.

Resorts World Miami, an offshoot of Malaysia-based Genting Group that has purchased property in downtown Miami to build its casino, also agrees with Bogdanoff's strategy.

"We don't think this amendment is going to be the cure-all for this bill," general counsel Jessica Hoppe said. "We've always been very realistic. This is the first step toward moving us along, and we're very positive about the process."