Monday, September 24, 2018
Business

Florida Gov. Rick Scott unlikely to roll dice on election-year gambling debate

TALLAHASSEE — As Gov. Rick Scott ramps up his re-election bid, he wants his legacy to be the state's declining unemployment rate and jobs, but the next few months could shape his message on a more controversial issue: gambling.

Will the state renew or expand the Seminole Tribe's monopoly on blackjack and other casino-style table games? Should the state allow slot machines in communities, like Palm Beach and Naples, whose voters have approved them at their racetracks? Will casino giants Genting and Las Vegas Sands be allowed to build a resort casino on the shores of Biscayne Bay or in Broward County?

Because it's an election year, most observers believe the governor will avoid finding answers.

The issues don't lend itself to 30-second campaign spots and pressure is mounting for lawmakers to postpone a decision on the most controversial gambling ideas until next year. Senate Gaming Committee Chairman Garrett Richter, R-Naples, is already lowering expectations.

"If an election year has any influence, it could influence the magnitude of what's undertaken,'' he told the Times/Herald. He suggested that a modest bill that tightens loopholes may get passed with everything else shuttled to another year.

Meanwhile, after spending $400,000 on an independent analysis of Florida's gambling options, and conducting town hall hearings across the state, Richter is going through the legislative motions.

He is working with Senate leaders to draft a bill in the next month that is expected to include rewriting the state's gambling laws. The bill could include an opening for a resort casino, expanded electronic slot machines outside of Miami-Dade and Broward and a reduction in live racing, particularly for greyhounds — a provision welcomed by owners in the dying industry.

But House leaders have said they will endorse a gambling bill only if it includes a constitutional amendment that puts any future change in gambling laws before a statewide referendum. It's a delicate dance for any election year and most observers believe the odds are slim that any major gambling legislation will get passed — unless the governor wants it.

The governor holds some very important cards.

While the compact with the Seminole Tribe lasts for 20 years, the portion that gives them the exclusive right to blackjack and other table games expires Aug. 1, 2015, and the governor is the only person authorized to negotiate it. Some of the nation's largest gambling operators, along with Florida's existing parimutuel industry, are urging him to use the compact to open the door to changes in Florida's gambling landscape.

The current compact was first inked by former Gov. Charlie Crist, now a Democrat running against Scott. It gave the Seminoles a monopoly to operate slot machines at their five casinos outside of Miami-Dade and Broward. It also gave them banked card games — blackjack, chemin de fer and baccarat — at the Hard Rock Casino in Tampa and their six other casinos.

In return, they agreed to make annual payments to the state totaling at least $1 billion between 2010 and 2015. Legislators also used the compact to give the horse and dog tracks, and jai alai frontons in Miami-Dade and Broward, a lower tax rate — from 50 percent to 35 percent.

Now, pari-mutuel operators want to reduce the requirement that they operate live racing, while those outside Miami-Dade and Broward want slot machines. Genting, the Malaysian-based casino group, wants to partner with Gulfstream Park and move an existing gaming permit to Genting's Biscayne Bay property. Boyd Gaming wants to partner with the Florida Panthers to build a casino next to the arena and the Sawgrass Mills mall in Broward County. And the racinos in Miami-Dade and Broward want the same table games the Seminoles have at the Hard Rock Casino in Hollywood.

Opposing these efforts is the Seminole Tribe and Disney, the Orlando-based theme park.

"Disney does not like gambling, but Disney and the tribe have been in the same camp,'' said Barry Richard, a lawyer for the tribe.

Because the compact restricts slot machines to the tribe's seven current reservations, the state agrees to give them the exclusive right to operate those games.

"If the provisions of Seminole exclusivity are breached, they continue to have the right to gaming but their payments are suspended,'' Richard said.

The agreement effectively serves as a firewall to expanded gambling because any decision by the governor and the Legislature to allow for new games must also replace the $250 million in annual revenue paid to the state by the Seminoles.

"It's like mutually-assured destruction,'' said John Sowinski, executive director of No Casinos, which opposes the laundry list of gambling proposals coming from the industry. He said his organization, which is supported by Disney, would be satisfied if the Seminole's current compact was renewed but "it certainly should not be expanded. We would oppose anything that would give them more."

Scott is keeping his distance. When asked this month about a proposal by Gulfstream Park and the Malaysia-based Genting Group to move their Broward County permit to Miami, the governor wouldn't answer.

"I know that the Legislature's going to be looking at gaming,'' he told the Sun-Sentinel. "And I look forward to working with the Legislature on any issue like that."

If Scott re-negotiates the compact this year, he inevitably makes it a campaign issue and he could be credited with expanding gaming, a politically-unpopular stance in some conservative parts of the state.

Already under Scott's watch, gambling regulators have allowed for Florida's gambling footprint to expand more than it has in decades. The Division of Parimutuel Wagering, for example, has approved barrel racing, held at a fledgling North Florida racetrack as a pari-mutuel sport. When a judge ruled that illegal, they allowed "flag-drop" races to replace them.

Regulators have allowed Miami-Dade and Broward pari-mutuels to run roulette and craps games as long as it is an electronic version mounted on a slots platform. And they allowed Tampa Bay Downs and Gulfstream racetrack in Hallandale Beach to run a one-time race in June and call it a meet so they could offer thoroughbred races via simulcast year-round.

If the governor waits to negotiate the compact, in an attempt to push the issue off until after the election, he risks having the Seminoles turn their billions in profits to potential contributions to Crist. The former governor earned the tribe's loyalty when he signed a generous compact that gave them their casino monopoly in most of Florida.

Steve Geller, the former Democratic state senator from Pembroke Pines who is working to elect Crist, believes there is pressure on Scott and Republicans to resolve the issues now, he said, "while they still control everything."

But, he said, it's more likely nothing happens because "a lot of Republicans may want to be in a position where they can raise money from the gambling entities in the 2014 general election by not resolving it.''

Scott, Crist and the Florida Legislature have already collected campaign contributions from every facet of the industry.

In the past few months, Scott's political committee has received $500,000 from the Seminole Tribe and is expected to receive more as the campaign moves closer to November. Sheldon Adelson, billionaire owner of Las Vegas Sands, wrote the governor's committee a check for $250,000 in July. And contributions are streaming in to the political committees of Florida legislators, who will control the debate.

Richter said he is optimistic lawmakers will pass legislation to close loopholes that have served to expand gaming in the last few years.

"At a minimum, we have a patchwork of regulations that have developed over the years,'' he said. "We are combing through these statutes to eliminate the duplicities and ambiguities."

He said it is possible "there could be an appetite to develop the framework for a gaming commission" (a regulatory body that the industry wants but gambling opponents say could be controlled by the industry.) But, he added: "Maybe. Maybe not."

Contact Mary Ellen Klas at [email protected] and @MaryEllenKlas

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