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Politics

House, Senate on Different Gambling Tracks

March 25, 2015 - 7:00pm

House and Senate leaders are taking divergent approaches to the perennially thorny issue of gambling, with the House vetting a soup-to-nuts gaming measure Thursday even as the Senate pursues negotiations with the Seminole Tribe of Florida.

House Regulatory Affairs Chairman Jose Felix Diaz's comments at the introduction of a four-hour workshop on gambling might have foreshadowed the future of a sweeping proposal released by House Majority Leader Dana Young the day before the legislative session began earlier this month.

"Welcome to the most anticipated non-event of the year," Diaz, R-Miami, quipped to a packed meeting room.

Young's plan (HB 1233) would allow a maximum of two Las Vegas-style casinos to open in Miami-Dade or Broward counties and would effectively do away with a 20-year revenue-sharing agreement, called a compact, with the tribe. A portion of the deal with the Seminoles giving the tribe exclusive rights to operate banked card games such as blackjack is set to expire on July 31 unless the Legislature reauthorizes it or signs a new agreement.

Speaking to reporters after the meeting, Young -- who previously characterized a gambling deal as "an enormous, gargantuan lift" -- conceded it is uncertain whether the measure would come up for a vote at all.

"I don't know yet," Young, R-Tampa, said.

Meanwhile, Senate Regulated Industries Rob Bradley told The News Service of Florida that his talks with the Seminoles have intensified over the past week.

"We are negotiating right now with the Seminole Tribe. Those are ongoing negotiations. Whether they will be fruitful or not remains to be seen," Bradley, R-Fleming Island, said.

The Senate is watching the progress of Young's bill but has no plans to offer a similar package, according to Republican leaders in the Senate.

"The House has taken a very comprehensive approach. We understand that that's the position of House leadership. If they are able to pass that bill in some form out of the House, then we will workshop it and take a very serious look at it. Meanwhile, we're pursuing negotiations with the tribe," Bradley said.

Echoing Young's comments earlier this session, Senate GOP leaders this week indicated that passage of the House proposal in its current form would be a difficult task as the 60-day session nears the midway point.

"Trying to put a gaming bill up in committee was like throwing a side of beef into a shark tank," Senate budget chief Tom Lee, a former Senate president who spent a decade in the Legislature before returning to the upper chamber in 2012, said of his experience with similar measures. "So good luck in the last three weeks of session trying to bring something in for a landing."

Senate President Andy Gardiner was equally cryptic.

"Given the size of the gaming expansion that the House put out there, and it being the majority leader and everything we sort of paused," Gardiner, R-Orlando, told reporters on Tuesday. "If they really are going to push for extensive expansion, then the Senate will have to figure out what to do. Never say never."

The future of the deal with the Seminole Tribe is a major looming question. Under the current agreement, the Seminoles agreed to pay the state a minimum of $1 billion over five years in exchange for exclusive rights to banked card games at five of its seven facilities throughout the state. The tribe's payments to the state have thus far exceeded the minimum and are expected to increase under a complicated revenue-sharing formula inked in 2010.

The agreement requires the Seminoles to share with the state 12 percent to 25 percent of what is known as the "net win" on their earnings -- essentially the difference between how much money they take in and how much they pay out to gamblers. The tribe shares a higher percentage of the net win if it increases, from a minimum of 12 percent on a net win of up to $2 billion to a maximum of 25 percent on a net win of $4.5 billion.

But Amy Baker, the Legislature's chief economist, told the House panel on Thursday that analysts do not predict the state during the remaining life of the 20-year compact to ever receive more than the current share, which is a 15 percent share on revenues up to $3 billion.

Baker offered lawmakers a swath of options for a new deal with the tribe, including changing what is included in the net win; imposing new minimum payments for activities such as expansion of facilities; greater exclusivity for the tribe by allowing it to offer games such as roulette or craps; and changing the revenue-sharing formula by increasing minimum dollar thresholds.

"All of these would take renegotiating the compact. None of these could be done in a simple extension," Baker noted.

Baker also said that lowering the tax rate on slots at pari-mutuel "racinos" in Miami-Dade and Broward counties -- now set at 35 percent, and reduced to 25 percent in Young's bill -- would generate a recurring loss for the state.

The talks between the Senate and the Seminoles could allow Miami-Dade and Broward pari-mutuels, which have slots, to add blackjack, increase the tribe's revenue-sharing amounts and give the Seminoles exclusive rights to roulette and craps, sources close to the negotiations said.

The cash from the Seminoles could be even more alluring in what was initially considered to be a rosy economic year but has since been overshadowed by uncertainty about health care funding.

Florida could lose up to $822 million over the next five years by not renewing the card deal, according to state economists' projections. Lawmakers have not included card-deal funds in their budget proposals this year.

But that issue did not arise during the four-hour House workshop on Thursday, where the panel received a briefing on gaming law and heard from more than 30 speakers representing in- and out-of-state gambling operators, horse breeders, Las Vegas casinos, business groups, greyhound protection and industry advocates and anti-gambling Christian conservatives.

The Seminoles, whose lobbyists were present at the meeting, were not among those who addressed the panel Thursday. The tribe has taken to the airwaves in three television ads to pitch a renewal of the card portion of the compact, emphasizing that the Seminoles have exceeded their $1 billion commitment in the past five years.

"Leaders of the Seminole Tribe closely followed today's workshop and felt the state did a fine job of sharing the value of the compact, which is not the subject of the three bills filed by Rep. Young. The tribe is focused on the important task at hand, which is to work out a way to keep the table games provision of the compact from expiring in July," Gary Bitner, the Seminoles' spokesman, said in a statement.

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