Gaming compact: Lawmakers brace for high-stakes session with $2.5 billion on the line

Credit: American Gaming Association Facebook page

Some 70 state lawmakers, reporters and other interested parties were schooled this week on “a spiderweb” of gambling laws in Florida, ahead of a special session of the Florida Legislature that aims to legalize sports betting for the first time.

That’s in spite of a 2018 constitutional amendment banning casinos and casino-type gaming except as approved by voters statewide.

At the heart of the matter is a proposed 30-year compact between the State of Florida and the Seminole Tribe worth a minimum of $2.5 billion to the state over the next five years.

If ratified by the Legislature next week, that new compact and its giant payout would replace a 2010 agreement worth absolutely nothing to the state since April 2019. During former Gov. Rick Scott’s administration, the state breached the terms of the 2010 compact, which had granted the Seminole Tribe exclusive rights to certain kinds of gambling games. The dispute went to court, a settlement was reached, but then it was not enforced by the state, so the tribe ultimately stopped paying the state a share of its gaming revenue, according to lawyers and legislative analysts who briefed lawmakers and news media this week.

Judging from lawmakers’ questions during the six-session legislative course on gaming, they are bracing for a barrage of lobbyists for and against legalizing sports betting, adding capacity for three more casinos in Broward County, and revising state laws on various games in various locations such that Florida’s gaming infrastructure could shift and realign like so many interlocking gears.

On Thursday, attorneys for Gov. Ron DeSantis and for Tribal Council Chairman Marcellus W. Osceola Jr. each said they believe the compact represents a compromise that benefits the Tribe, state government, and the state’s pari-mutuels industry, which competes with the Tribe for gambling dollars.

“If there’s one loser in this compact, it would be somebody who really wants Florida to turn into Las Vegas,” said James Uthmeier, the governor’s lead negotiator on the compact. “That just cannot happen. You’re not going to have big casinos in every corner of the state, and I know many of you probably appreciate that.”

That’s because Amendment 3, adopted by voters in 2018, bans new casinos in Florida except as authorized by voters — but that doesn’t apply to land owned by the Seminole Tribe, a federally recognized sovereign nation. Thus, the tribe is not subject to the provisions of Amendment 3 and is the only entity in Florida that can operate casinos without voter approval.

“That puts together a pretty complex spiderweb of regulations that dictated the way this negotiation would have to take place,” Uthmeier said.

The only new casinos on the horizon would be authorized in the new compact to be built on tribal land in Broward County, within the footprint of the Tribe’s casino resort in Hollywood.

The compact would allow sports betting throughout the state in a “hub and spoke” scheme centralized in servers on tribe-owned land. It does not authorize online gaming, which is casino-style games played online with other players, Uthmeier says.

“We do think Florida is a prime state for sports betting,” Uthmeier said, citing Florida’s plethora of sports, teams and arenas. On the other hand, “The governor right now was not even willing to talk about [online gaming]. That was a deal-breaker from the beginning.”

Jim Allen, representing the Seminole Tribe, said Thursday that an estimated $7 billion is wagered in illegal, offshore gaming with no benefit to Florida, and the state may as well regulate it and tap into the bonanza.

Allen said the tribe has no imminent plans to build the new casinos authorized in the compact, but would build them sometime over the course of the 30-year compact.

No Casinos, the group that promoted passage of Amendment 3 in 2018, continues to oppose any expansion of gambling in Florida except as approved by voters. It is expected to mount a legal challenge to the hub-and-spoke arrangement proposed in the compact that would allow sports betting statewide, contrary to the intent of Amendment 3.