Gambling Bills Likely To Spark High Stakes Debates

February 5, 2016

House and Senate leaders will roll out gambling bills Friday that would allow the Seminole Tribe to add craps and roulette at its casinos, potentially do away with dog racing and most horse racing and open the door for slot machines in Palm Beach County.

Late Thursday, Senate Regulated Industries Chairman Rob Bradley and his House counterpart, Regulatory Affairs Chairman Jose Felix Diaz, were working on details in the two proposals, slated for votes next week in both committees.

“We’re still working on the language. We’re going to be here all night. This is a gargantuan bill,” Diaz, R-Miami, told reporters.

Both chambers’ plans include legislation that would authorize an agreement inked by Gov. Rick Scott and Seminole tribal chief James Billie last month. That deal, called a “compact,” would allow the Seminoles to add craps and roulette at each of the tribe’s seven Florida casinos, on top of banked card games — such as blackjack — already in play at most of the Seminoles’ facilities.In exchange, the Seminoles have agreed to pay the state $3 billion over seven years — triple a $1 billion, five-year deal that expired last summer — in what is believed to be the largest tribal revenue-sharing agreement in the country.

Separate bills will address pari-mutuel-industry issues that are permitted, but not specifically authorized, by the proposed compact, according to Bradley and Diaz.

To make the bills more palatable to gambling-leery lawmakers, the measures would do away with dormant pari-mutuel permits and eliminate some active permits.

But one of the most controversial items would allow horse tracks to do away with racing all types of horses except thoroughbreds, a process known as “decoupling,” while keeping more lucrative card rooms and, for some, slot machines. A portion of the revenues from the compact would go to supplement purses for thoroughbred horse races, now running at Gulfstream Racetrack and Tampa Bay Downs.

Greyhound tracks would also be allowed to decouple, an idea that has been supported by many lawmakers but has faced opposition from greyhound breeders, owners and kennel operators. Horse breeders, owners and trainers also have strenuously objected to decoupling.

Decoupling horses “would essentially make welfare queens out of horsemen by creating an artificial set-aside market” and “wipes out any semblance of free enterprise,” the United Florida Horsemen, representing owners, breeders and trainers, said in a statement.

Jai alai operators would have to keep their games under both proposals.

The measures would also allow slot machines in Palm Beach County and at a new facility in Miami-Dade County. Permits for the slots would be attained through a procurement process and would require operators to give up active permits to be eligible for the new games.

The Senate proposal — which Bradley called “an aggressive plan to reduce gaming” in Florida — would also allow Scott to “buy back” active permits, using money from the revenue-sharing agreement with the tribe. The House is not expected to include that provision in its initial roll-out, Diaz said.

The House will also offer a third measure, a proposed constitutional amendment that would require voter approval for any expansion of gambling after the compact and accompanying pari-mutuel changes are approved, Diaz said. The Senate is not yet proposing a similar measure.

The pari-mutuel-related bills would also reduce the tax rate on slot machines paid by Miami-Dade and Broward pari-mutuels, known as “racinos.” The proposed compact would allow a 10 percent drop from the current 35 percent tax rate.

Diaz said his proposal will include a 5 percent tax reduction, and up to another 5 percent for pari-mutuels that agree to reduce the number of slot machines at their facilities. The South Florida operators each are allowed to have up to 2,000 slot machines, but all have fewer than that number, and some only have about 1,000, Diaz said.

Blackjack is off the table for the racinos, Diaz said, although the proposed compact would permit the games — limited to 15 tables, and capped at maximum bets of $15 — for the Miami-Dade and Broward facilities.

The Palm Beach Kennel Club, which for years has pushed for slots, would be able to add 750 slot machines and 750 “video racing” terminals, if it wins the bid for the permit.

Who gets slots has also been a point of contention for lawmakers. Voters in six counties — including Palm Beach — have approved slots for their local pari-mutuels, but gambling regulators have refused to sign off on the lucrative games. The Florida Supreme Court is now considering whether Gretna Racing, a small horse track and card room managed by the Poarch Creek Indias in Gadsden County, should be allowed to have slots without the Legislature’s express permission. Voters in six counties — including Gadsden and Palm Beach — have approved slots for their local pari-mutuels.

With the 60-day legislative session nearing its midway point, Scott and the Seminoles have stepped up pressure on lawmakers to approve the compact.

Lawmakers have plenty of time, Diaz said Thursday.

“I think it’s pretty early,” he said, adding that the bill could be more difficult to pass as the end of the 2016 session approaches.

Diaz also said “we have the votes in my committee” to pass the measures.

“Things could change and people could change. But the members understand that this is a work in progress and they’ll have another vote on it” before it reaches the floor, he said.

“Everybody’s ideal scenario won’t come true. There will be tough decisions for us to make as a body. I don’t know if there will be anybody out there that will feel like they got everything they wanted,” Diaz said. “But the bill …will be in a posture that is passable and will continue the conversation for us live to fight another day.”

But Bradley — whose committee includes senators who are opposed to any expansion of gambling as well as those who want slots in Gadsden and Lee counties — wasn’t as confident. Like Diaz, Bradley said he expects committee members to propose amendments to the legislation next week. The fate of the bills could hinge on what gets added to the measures.

“Right now, it’s a jump-ball,” he said.

by Dara Kam, The News Service of Florida

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