Florida Gaming Compact Signed; May Change

Florida Gov. Charlie Crist and the Seminole Tribe of Florida signed a gaming compact Aug. 31 that has some significant changes from a gaming law Crist and the Florida legislature approved earlier this year.

The compact would give the Seminoles exclusive rights to blackjack and baccarat at all seven of their Florida casinos, rather than at four as authorized by the law passed in May. The compact also spells out several circumstances under which the Seminoles could reduce their annual gaming revenue payments to the state.

There already are concerns the legislature might not accept those changes—and thus prevent the law and any of its provisions from taking effect.

The compact doesn’t change major provisions related directly to Florida Thoroughbred industry. Those provisions would provide operational and economic benefits to three racetracks in southeast Florida and to the state’s breeders.

Crist is expected to call a special session of the legislature for October, in which it would vote on the compact. The law stipulates that its provisions will not take place if there is no Seminole compact.

Sen. Dennis Jones and Marc Dunbar, a lobbyist for Gulfstream Park and its parent, Magna Entertainment Corp., said there is talk that Crist, the Seminoles, and the legislature might try to resolve their differences prior to a special session.

Under the 20-year compact, as well as under the 2009 law, the Seminoles would annually pay the state at least $150 million. The payments would increase on a sliding scale if the tribe’s gaming revenue grows. Last year, the Seminoles began making payments starting at $100 million a year.

In late August, Rep. Bill Galvano, the House’s key negotiator on gaming issues, indicated the legislature might agree to the Seminoles having blackjack and baccarat all of their casinos if the tribe accepted another trade-off. In that compromise, the law would add a provision allowing pari-mutuel facilities in several counties, notably Palm Beach County and Duval County, to have Class II bingo-like slot machines. Both counties have Greyhound tracks.

The only slots permitted at Florida pari-mutuel facilities are Class III Las Vegas-style machines in Broward and Miami-Dade counties.

But in an apparent rejection of Galvano’s compromise, the compact states the Seminoles could reduce payments to the state, and in some cases even halt them, if any Florida pari-mutuel outlets are permitted to have new gaming products.

“This (compact) might have the potential for us to lose more than we gain,” said Jones, who heads a Senate committee with jurisdiction over pari-mutuel and tribal gaming issues. “We will need to determine how the (Seminole gaming revenue) the state would gain would compare with the potential revenues it would never receive if no expansion of gaming is permitted for pari-mutuels.”

Dunbar, a partner in the Pennington Law Firm in Tallahassee, said he expects to discuss the compact with Gulfstream officials Sept. 1.

“With the governor and the Seminoles signing a compact by Aug. 31, the negotiations game can continue,” said Dunbar, who said the 47-page compact is “very convoluted and confusing.”

“Between now and a special session, I think there will be more negotiations among the governor, the Seminoles, and the legislature,” he said.

An agreement among those parties would need to be followed by an expected sign-off by the U.S. Department of the Interior, which oversees tribal gaming. If all approvals take place, provisions of the 2009 law and a compact could take effect as soon as December.

Under the law and the compact signed Aug. 31, the state’s Thoroughbred industry would benefit from these changes:
 
--The state tax rate would drop from 50% to 35% at pari-mutuel casinos in the southeast Florida counties of Miami-Dade and Broward. Gulfstream, in Broward, has a casino with Class III Las-Vegas style slot machines, and Calder Race Course, in Miami-Dade, plans to open a casino with those machines in January 2010.
 
--Now-closed Hialeah Park, in Miami-Dade, could resume Thoroughbred racing on a limited basis, utilizing a Quarter Horse permit it was issued last March by the Florida Division of Pari-Mutuel Wagering. Within two years of reopening, Hialeah would be eligible for a casino with Class III slot machines.

--A not-for-profit Thoroughbred meet is authorized for the Ocala Breeders’ Sales Co.

--Florida Thoroughbred tracks could begin night racing.

The law also has a boost for the poker rooms at all Florida Thoroughbred, harness, and Greyhound tracks and jai-alai frontons. It would raise limits on bets from $5 to $50 and expand their daily hours from 12 to 18 on weekdays and 24 on weekends.

Tampa Bay Downs would participate in that poker expansion, but would not have other immediate gains from the law.

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