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Will Florida modernize its gambling industry? Senators race to close deal

Three bills attempt to modernize an industry that has been shifting for generations.
Lawmakers are considering a proposal to end live racing and jai-alai at most of the state’s gambling venues. Only the thoroughbred race tracks — Gulfstream Park and Tampa Bay Downs — would continue to be required to operate live racing, thereby preserving a Florida-based industry.
Lawmakers are considering a proposal to end live racing and jai-alai at most of the state’s gambling venues. Only the thoroughbred race tracks — Gulfstream Park and Tampa Bay Downs — would continue to be required to operate live racing, thereby preserving a Florida-based industry.
Published Apr. 8
Updated Apr. 8

TALLAHASSEE — With the clock running out on the 60-day legislative session, the Florida Senate on Wednesday released an ambitious proposal to end live racing and jai-alai at most of the state’s gambling venues and put the state’s antiquated regulatory structure under a newly-created gaming commission.

Three bills, scheduled to be heard Monday by the Senate Regulatory Industries Committee, attempt to modernize an industry that has been shifting for generations by creating a new regulatory structure and allowing casinos to operate card games without running harness or quarter-horse races or jai-alai matches, a concept known as decoupling.

The Senate also would create a five-member Gaming Control Commission appointed by the governor and housed in the office of the Florida attorney general and it establishes a public records exemptions for the new commission.

“As we do with other industries, we have a responsibility to ensure our laws are updated to reflect current realities of the industry and that those laws are properly enforced.,’' said Senate President Wilton Simpson, R-Trilby, in a memo to senators Wednesday.

The bills are considered by some in the industry to be a “Hail Mary pass” by Simpson who has been stymied at achieving his goal of reaching a broader gaming deal with the Seminole Tribe of Florida this session.

Simpson had hoped to reach agreement on a plan to bring in $650 million in additional gaming revenue by allowing the Seminole Tribe to operate craps and roulette at their seven casinos and have the exclusive license to operate online sports betting in exchange for the Tribe’s resuming revenue sharing payments to the state.

But those talks have struggled to reach a conclusion and Simpson’s more modest proposal keeps the issue alive in the final weeks of the legislative session while it buys time for Gov. Ron DeSantis to attempt to reach an agreement on a gaming compact with the Tribe.

“Decoupling and a gaming commission are two things the Tribe is not opposed to and we think they are important,’' said Sen. Travis Hutson, R-St. Augustine, chair of the Senate Regulated Industries Committee. “We hope the governor and Tribe will come together and resolve their issues in the next 72 hours to a week and we’ll have some new progress.”

No deal for Fontainebleau

Absent from the proposals is any talk of transferring a gaming permit from Broward County to Miami Beach’s Fontainebleau Hotel and Resort, a top priority of real estate mogul Jeff Soffer. Soffer used his super-yacht, his friendship with Tampa Bay Buccaneers quarterback Tom Brady, and $1.1 million to meet with Simpson and House Speaker Chris Sprowls in an attempt to get legislators to give renewed attention to bid for a Miami Beach casino.

On March 18, DeSantis and Simpson told 20 top officials of Florida’s casinos, poker rooms, horse tracks and jai-alai facilities they were “getting close” to a gaming compact, but in the weeks that followed, progress has stalled. They had offered to allow the Tribe to offer mobile sports betting while allowing the state’s existing horse tracks and jai-alai frontons to license betting operations.

But the talks have been snagged, several people close to the negotiations said, over how to split the proceeds over sports betting with the parimutuel industry, whether or not to allow the Tribe to establish additional facilities and whether to allow parimutuels to continue operating designated-player games.

The Tribe stopped paying the state $350 million in annual revenue sharing after former Gov. Rick Scott refused to crack down on parimutuels operating designated-player games, a hybrid between blackjack and poker, where the “bank” is supposed to revolve among the players. A court said that because the state had allowed the Tribe’s competitors to operate the games, that violated their gaming compact, which called for the state giving the Tribe the exclusive ability to offer blackjack.

The Tribe said it would not comment on the negotiations.

DeSantis told reporters last month he was open to negotiating a new deal with the Tribe “but at the same time, we are not in a position where we’re desperately needing additional revenue.”

Senate president’s argument

In a memo to senators on Wednesday, Simpson acknowledged the difficulty of getting a comprehensive gaming bill passed, something that has frustrated legislators for the last decade.

“Florida is a diverse state and our Senators and constituents have many different opinions, beliefs and convictions regarding gaming,’' he said. “The fact remains, gaming is a voter-approved industry that has contributed billions of dollars to our economy for education, health care and infrastructure, while providing hundreds of thousands of jobs to Floridians over the course of nearly 100 years.”

Simpson said it was time to update Florida’s gaming enforcement, which is now “decentralized among Florida’s cities and counties, primarily left to local law enforcement.”

For years, legislators have considered consolidating Florida’s porous regulation of the gaming industry, which is currently under the authority of the governor in the Division of Parimutuel Wagering under the Department of Business and Professional Regulation. But because of years of legal rulings and a patchwork of laws passed by legislators, enforcement of basic things like drug tests on race horses is hard to enforce.

“Regulation of gaming and enforcement of laws against illegal gaming not only protects the public, but the integrity of the industry,’' Simpson said in his memo.

The bill, SPB 7076, grants additional investigatory and prosecutorial authority to the Office of Statewide Prosecution in the Department of Legal Affairs. The new gaming commission would be housed within the Department of Legal Affairs although its members would be appointed by the governor and confirmed by the state Senate.

The second piece of the package could put an end to the declining segment of the industry: live racing. Under Florida law, only a parimutuel permit holder is permitted to operate a card room but in order to keep that permit the facility also must maintain a full schedule of live racing, which consists of no fewer than 90% of the live performances the facility conducted during the fiscal year that its card room license was issued.

When voters approved Amendment 13 in 2018 putting an end to greyhound racing in Florida, it effectively allowed greyhound tracks to decouple their card rooms from live racing. Under the Senate proposal, SPB 7080, card rooms would no longer have to operate jai- alai matches, harness, and quarter-horse racing.

Only the thoroughbred race tracks — Gulfstream Park and Tampa Bay Downs — would continue to be required to operate live racing, thereby preserving a Florida-based industry. Simpson, a Trilby egg farmer, is considering running for agriculture commissioner, and the horse breeding industry in Central Florida depends on live racing in Florida to sustain it.

“Thoroughbred breeders, owners, trainers, and permit holders believe keeping a live racing schedule is vital to their industry and its long history in our state. As such, they are not included in this legislation,’' Simpson said in his memo.

The committee will also consider a public records and public meetings bill to exempt certain meetings of the Gaming Control Commission when dealing with active criminal intelligence information or active criminal investigative information.

If the bills make it through the Senate, they must also pass in the House, where Speaker Chris Sprowls has said he is willing to help Simpson with his goal but does not consider them a top priority. He told reporters last month that in his six years in the state House, no gaming bill has ever passed, because there are so many interlocking parts involving competing interests.

“It seems to be the third rail of the Legislature,’' he said.

Mary Ellen Klas can be reached at meklas@miamiherald.com and @MaryEllenKlas