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Gaming's promises to Florida have often exceed the payoffs

TALLAHASSEE — The news conference called by the heads of South Florida's horse and dog tracks in October 2004 had one goal in mind: to counter voter skepticism.

After nearly two decades of partly kept promises that the Florida Lottery would benefit education, the industry was struggling to persuade voters that if they supported a constitutional amendment to give the South Florida tracks slot machines, the revenues would go to enhance public schools. So the heads of the parimutuel industry presented a symbolic check for $500 million to Wayne Blanton, executive director of the Florida School Boards Association, and announced it was their annual "guarantee."

"There's been a lot of cynicism and questioning of motives so, today, we're putting our absolute guarantee on it," Jim Horne said at the time. The former state education commissioner was the hired spokesman for constitutional Amendment 4, which would give voters the power to authorize slot machines in Miami-Dade and Broward counties.

Fast forward seven years. The parimutuels have their slot machines. The financial guarantee has never materialized.

The Florida Legislature imposed a 50 percent tax rate on the new games, higher than the 30 percent the industry expected. The Seminole Tribe became instant competitors and chipped away at their market. The racetracks couldn't achieve more than about 23 percent of their promised $500 million in annual gaming taxes — and the Legislature never earmarked it for education.

"Dashed hopes and good intentions,'' said Rep. Dennis Baxley, R-Ocala, a gambling opponent. "Whenever it comes to gambling dollars, it's always a false promise."

Now, promoters of the bill to bring three major casino resorts to South Florida are staying away from monetary promises. They talk instead about luring international tourists and spurring economic development. Their goal is a "strategic approach to gambling in Florida,'' that will feature oversight by a state gambling commission and an end to an industry-driven, unfettered expansion of gaming.

"The No. 1 question I get to this day is: 'Where's the money? Where's the money for education?' '' said Sen. Ellyn Bogdanoff, the Fort Lauderdale Republican who is sponsoring the bill. She said she doesn't know what the economic impact will be and added, "Quite frankly, I don't care, because this is not a revenue debate for me." All the money raised by the new casinos would go into the state's general revenue fund so that, unlike the slots amendment and the Lottery before it, lawmakers will not require legislatures of the future to keep promises made today, she said.

"The expression is, if you wrap it in children, if you wrap it in education or you wrap it in the American flag, it will fly out of the House and the Senate,'' she said. "Hopefully, we don't continue to do that."

But gambling opponents warn that even if the proponents manage to pass a casino bill without linking the tax revenue to a specific need such as education, there will be broken promises nonetheless.

"They're trying to sell the Legislature the same way they sell gambling to customers — an illusion of a great reward without any basis in reality,'' said former state Sen. Dan Gelber, a volunteer with No Casinos, the Disney-backed antigambling group.

The Legislature has sole control over state budgeting, and no law can force lawmakers to spend money, no matter what promoters promise.

"Legislators can't control the future,'' Baxley said. "When you get extra dollars from a new source, it's not really extra dollars. Each Legislature is going to evaluate it in the time frame they're in."

At the first hearing on the casino proposal at the Senate Regulated Industries Committee last week, the president of Genting Americas, Colin Au, showed up prepared to counter criticism of his proposed megacasino. He responded to concerns about suffocating hometown businesses, aggravating traffic congestion and the crush a megacasino resort would have on traffic.

Au made promises.

"At our own cost, we are going to improve I-395 instead of waiting for the state,'' he said. Later, he noted: "We will guarantee half the seats of nonstop flights from the Asia Pacific. … I'm even prepared to guarantee Disney 100,000 tickets that we will sell for them in our resort."

The sensational pitch drew a rebuke from Bogdanoff, who called Genting's revenue and job protections "over-the-top." She urged the company to "tone it down and be realistic."

But Bogdanoff has already lost one battle over guarantees. The bill includes a provision requiring each casino licensee to pay the state $250,000 yearly for a compulsive-gambling prevention and awareness program. The money will go into a state account, and it will be up to the Legislature to allocate the funds. Bogdanoff says the bill includes that provision as a compromise with the House sponsor. But she's against it: "Let the industry pay for those programs itself. We don't make the liquor industry contribute to Alcoholics Anonymous."

A similar requirement already exists in state law. When Florida legislators implemented slot-machine gambling in 2008, they required every licensed slots casino to contribute $250,000 yearly to the nonprofit Florida Council on Compulsive Gambling, a gambling-neutral organization that was started in Florida alongside the emergence of the state Lottery.

Each year, the organization has collected money from the slots vendors and money from the Lottery to finance its statewide compulsive gambling hotline, training for casino workers to spot the warnings signs of addicted gamblers, and education and prevention programs in schools, senior centers and throughout the community.

Except this year.

Gov. Rick Scott broke the deal and vetoed all $900,000 from the slot licenses, leaving the money instead in the state's rainy-day fund.

"You have to make choices,'' Scott said when asked to defend the move.

The Legislature also broke a commitment to the compulsive gambling council. In the face of a budget shortfall, it reduced the annual $690,000 in Lottery revenues that for years had been earmarked for compulsive gambling prevention to $264,000. Lawmakers decided it was easier to shift money into other state needs than to find replacement money.

But to Pat Fowler, executive director of the Florida Council on Compulsive Gambling, it's a harbinger of more trouble to come as legislators debate whether to bring resort casinos to Florida.

The cuts forced the Alta-monte Springs-based council to cut back staffing on its 24-hour toll-free help line, 1-888-236-4848, at the same time the number of people who call the help line for addiction help is up 18 percent in the past year.

The council has ended programs that trained health care professionals to assess and treat those suffering from a gambling problem. It can no longer afford to put the hotline number on the backs of Lottery tickets, in gambling facilities, on billboards on major thoroughfares, and in publications throughout the state.

Fowler is discouraged that legislators appear to have no desire to override the governor's veto or restore the money.

"There are times when we all have to cut back and tighten our belt and do the best thing for all, but this certainly is not a move to do the best for all,'' she said. "We cannot continue to increase and debate gambling in the state and just ignore the negative impact that is has."

Gaming's promises to Florida have often exceed the payoffs 11/20/11 [Last modified: Sunday, November 20, 2011 10:09pm]

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