Friday, May 25, 2018
Business

Will horse and dog tracks kill push for mega-casinos in Florida?

The push to bring mega-casinos to South Florida faces a host of unknowns: would local voters approve the proposal in a public referendum? Will state lawmakers and Gov. Rick Scott even allow the issue to get that far?

But another, quite-crucial question also needs to be asked: Will horse and dog tracks just kill the entire thing?

Those often-struggling tracks, along with faded jai-alai frontons, make up Florida's parimutuel industry — a group that holds considerable sway over gambling politics in Florida's state capital. While international casino conglomerates are lobbying heavily for large-scale "destination resorts," and the Seminole Tribe is also working the power corridors of Tallahassee, it is parimutuels — the least profitable of the bunch — that usually have the most access to lawmakers' ears.

"Got their hand out anytime we're in session," state Sen. Dennis Jones, R-Seminole, said of the parimutuels. "It's a committee of greed."

Nevertheless, Jones, in most instances, is a supporter of Florida parimutuels — businesses that trace their Florida roots as far back as the 1920s. It's that lengthy Florida history, as well as the industry's tens of thousands of employees, that parimutuels say makes them worthy of special protection.

Other gambling interests have certain obstacles when making their pitch to lawmakers, according to Bob Jarvis, a Nova Southeastern University professor who has studied gambling issues. The Seminole Tribe has waged heated court battles against the state, Jarvis said, while destination resort developers such as Malaysia's Genting Group don't have deep Florida roots.

"The Johnny-come-latelys are all seen as people from outside the state, who don't have the best interest of the people of Florida at heart," Jarvis said.

Parimutuels, meanwhile, have a decades-long track record of being a constituent of — and usually a fundraiser for — their local state lawmaker. Isadore Havenick, vice president of the Magic City Casino dog track, argues that to not include the parimutuels in the current casino debate would "be like having a conversation about grocery stores, and not including Publix."

But the parimutuel industry's demands may well destroy any chance of the Legislature passing a destination casinos bill this year.

When a Senate committee considered the bill earlier this week, it advanced only after senators inserted significant changes benefiting parimutuels. Several senators gave short speeches announcing how important it was that the parimutuels not be harmed.

The amended bill — which still has many stops before becoming law — allows tracks to add the same full assortment of casino games as any destination casino that opens in the same county, while paying the same 10 percent tax rate. That's a significant tax cut from the 35 percent tax that parimutuels currently pay on slot machine revenues.

In fact, the bill now has so many pro-parimutuel changes that it may become simply unworkable in the more-conservative House.

Under the current bill, destination casino operators would be required to invest $2 billion in construction, and obtain voter approval, to gain gaming rights. The parimutuels wouldn't have to build a thing, or ask voter permission.

So far, destination resort companies such as Las Vegas Sands are not picking a fight with the parimutuels — perhaps mindful that the casino bill already has its hands full in dealing with opposition that includes the Walt Disney Company and religious conservatives. Miami billionaire auto dealer Norman Braman is also committed to fighting the proposed casinos.

"As you know, I've never been embarrassed to write a check," Braman said. "I'm prepared as always to put my money where my mouth is."

Sands lobbyist Nick Iarossi is limiting his complaints to just one small section of the reworked bill — a section he says would allow parimutuels to avoid the same of level of regulatory scrutiny (such as background checks) that out-of-town companies like Sands would face.

"I think that's going to be fixed, it was unintentional," Iarossi said, adding that strict regulation is essential to making sure "no unsuitable actors" are involved in running Florida casinos.

Parimutuels in Miami-Dade and Broward counties are allowed to offer slots, while tracks in other parts of the state can only run races and offer poker games.

The common theme with almost all parimutuels is that what used to be their core business — horses, dogs or jai-alai — is no longer the draw it once was. In the 1940s and 1950s, such races were celebrity-filled, glamorous events. Not anymore.

"The parimutuel pie is not very large, and it's not growing," said David Romanik, an attorney who specializes in Florida gaming law.

State Sen. Ellyn Bogdanoff, a Fort Lauderdale Republican who is sponsoring the bill to usher in destination resorts, said the parimutuels have long driven the state's gambling agenda.

Said Bogdanoff: "They're simply looking for every angle they can get to stay in business."

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