Surprise! Florida Legislature may reconvene on gambling, with $300 million at stake

It’s an election year and a constitutional amendment on the November ballot looms as a threat to the pari-mutuel industry, so Florida legislators are considering coming back for a special session on gambling — if only the Seminole Tribe will agree.
Published March 30, 2018

When Florida legislators adjourned the annual session three weeks ago without a new gaming deal with the Seminole Tribe, they left open the prospect they could come back in special session to deal with the issue — after giving gaming interests time to donate to their campaign coffers this election year.

On Thursday, those odds increased as House and Senate leaders confirmed they are considering calling a special session in an attempt to persuade the tribe to negotiate a new compact.

"Speaker-Designate [Jose] Oliva and I are continuing to explore those issues," said Sen. Bill Galvano, R-Bradenton, the Senate's incoming president. "One of the concerns is the possible loss of revenue from the Seminole Tribe and the impacts on the state budget. For that reason, there is a potential that we would need to revisit gaming prior to the start of the 2018-19 fiscal year."

Galvano and House Speaker Richard Corcoran each expressed concern about the tribe's refusal to sign an extension of a legal agreement that expires Friday, March 30.

Under the so-called "forbearance" agreement, the tribe is obligated to continue monthly payments to the state even if it is not satisfied with the way the state is regulating controversial card games known as "designated player games" offered at horse and dog tracks and jai-alai frontons.

The tribe sued the state and won when it argued that the card games violated the tribe's exclusive right to operate banked card games such as black jack at its Hard Rock and other casinos.

Under a 2010 agreement with the state, known as a compact, the tribe has the exclusive right to the banked card games and the exclusive right to operate slot machines outside of Miami-Dade and Broward counties. In exchange, the Seminole Tribe pays the state more than $300 million a year.

Legislators say they worry that when the forbearance agreement ends, the tribe may stop payments to the state — even though the tribe continued payments while it was suing regulators and has given no indication it would want to antagonize the state now.

"They have not told me they will not continue payments, although their decision not to extend the forbearance agreement is a concern," Galvano told the Herald/Times.

Corcoran, a Land O'Lakes Republican, also sounded the alarm in a statement released late Thursday.

"The Seminoles' potential to completely walk away from the forbearance agreement jeopardizes the stability of the state budget," he said. "We will be forced to cut between $390 [million] and $441 million in general revenue, or we will have to allow our reserves to be drained, which could jeopardize our state bond rating."

Corcoran is expected to announce his campaign for governor in mid-April and he is trailing his potential primary challengers in fundraising. Faced with shifting demographics and a competition to use legislation and regulations for competitive advantage, the pari-mutuel industry is traditionally one of the most reliable contributors to legislative and statewide campaigns in Florida.

Lawmakers want to give the tribe additional games, such as craps and roulette, in exchange for asking for higher annual payments to Florida. But they also want some counties where voters have approved slot machines outside of Miami-Dade and Broward to be allowed to operate slots at their pari-mutuels without violating the compact.

There is only one problem: the Seminole Tribe is not eager to re-negotiate the compact right now.

The tribe has joined with Disney Worldwide to back a constitutional amendment on the November ballot that would require a statewide vote to expand gambling options in Florida. If the measure succeeds, legislators will have less influence over all gaming decisions, thereby reducing the fundraising potential of the industry and cementing the status quo in place indefinitely.

Little has changed since gaming talks ended in stalemate on the final day of the regular session on March 9, except that the deadline is Friday — when the state must satisfy the tribe with its handling of designated player games without jeopardizing the tribe's monthly payments to the state.

Galvano emphasized no decision has been made about a special session, but if one were to take place it would likely be before the end of the fiscal year on June 30.

McKinley Lewis, a spokesman for Gov. Rick Scott, said the governor was "made aware that the Legislature was looking at this issue" and "will review any proposal they put forward."

Tampa Bay Times bureau chief Steve Bousquet contributed to this report.