Steve Geller named General Counsel of the National Counsel of Legislators from Gaming States (NCLGS); Speaks at NCLGS Winter Conference on casino saturation and what states can realistically expect in terms of Tourism from new casinos.
I attended the NCLGS Winter Conference in New Orleans, which was held from January 4-6. NCLGS is the only organization of State lawmakers that meets on a regular basis to discuss issues in regard to gaming. Members of NCLGS chair or are members of Legislative committees that are responsible for the regulation of gaming in their states. NCLGS does not promote or oppose gaming, but is primarily concerned with proper regulation of the gambling industry.
I was the founder of NCLGS in 1995 and was its long-time first President. I have remained very active in NCLGS, and was named its General Counsel at the Winter meeting.
On Sunday, January 6, I spoke on a NCLGS panel discussion. The topic for the panel was “When developing gaming public policy, legislators often envision casino out-of-state patrons who will do more than gamble in the casino. But with more than 1,000 casinos in 42 states, and with new casinos generally being built to smaller scale due to their proliferation, is it realistic to expect them to be tourism magnets? Are there many markets remaining where destination resorts could be developed to attract tourists? In this panel, operators will provide insight into what states can realistically expect, and what they must do to meet the goal of tourism promotion.”
In my remarks, I discussed the history of recent gaming expansion nationally. This included Indian casinos, “riverboats gambling” (which is generally not conducted on what most people would consider to be “riverboats”, racinos, and commercial casinos. The most common thread on the expansion of all of these except for Indian gambling is the desire for one state not to see its gambling dollars go to another state. Once one state starts a type of gambling, there is increased pressure on neighboring states to have similar types of gambling.
It seems clear that the proliferation of casinos is generally reaching saturation in most areas. For example, in the Northeastern United States, there appears to be a situation where new casinos are cannibalizing revenue from existing casinos. Total gaming revenue may go up, but revenue per casino appears to be going down. I gave quotes from both Moody’s and the American Gaming Association (AGA) discussing that while this appears to be most acute in the Northeast, it is a national issue.
It appears that building casinos by itself is no longer sufficient to attract new tourism. It is unclear if casinos by themselves have been enough to attract tourists in recent years, or if casinos were only helpful as part of a general resort that attracted people. Today, however, there is so much availability of casino gambling without the necessity of travelling that just providing additional opportunities for gambling will not attract tourism.
Many casinos today are being built on a smaller scale, and are designed to attract primarily local patrons as opposed to tourists. It seems that the new casinos that are attracting tourists are the “hubs” of the “hub and spoke” model. This seems to work better with large casino chains with robust loyalty programs where casino patrons can gamble locally, and then cash in player rewards at larger resorts, where casino gambling is only part of the attraction.
Food and beverage, shows, and other diversions are a must to attract tourism dollars. Las Vegas and Atlantic City have recognized this. For example, in Las Vegas in the 1990’s, over ½ of the casino revenue came from gambling, while today it’s down to about 1/3. As younger people lose interest in slot machines, which have traditionally been and remain the biggest gambling money-makers for casinos, casinos will need to do other things to attract people and remain relevant. Some things being discussed are sports gambling, skill-based gaming, E-sports, and even virtual reality gaming.
The most important thing to remember is that the tax rate set by a state will determine what type of gambling takes place in that state. Legislators will need to decide what is most important to them in their states. Hub resort casinos require a lower tax rate to be successful than does a “slots barn”. A state can make money on casino gambling with most tax rates, but lower tax rates result in more investment and jobs, while a higher tax rate can result in more total gambling-exclusive revenue. A tax rate of 6% may get a state a Wynn or Bellagio-style luxury resorts, a tax rate of 25% may get a state a nice hotel franchise casino, a tax rate of 60% may get a state slot machines at convenience stores. All may be viable models; all result in completely different outcomes based on the tax rate.
Proposed Amendment Three to the Florida Constitution (Voter Control of Gambling) is misleading and far more expansive than most people believe. The exact impact of the Amendment is unknown, and it may have an unintended impact on Florida’s two Indian tribes. If it is passed now, it will be extremely difficult to undo.
Summary: Proposed Amendment Three to the Florida Constitution (Voter Control of Gambling) is misleading and far more expansive than most people believe. The exact impact of the Amendment is unknown, and it may have an unintended impact on Florida’s two Indian tribes. If it is passed now, it will be extremely difficult to undo.
The Seminole Indian Tribe of Florida and Walt Disney World have been the two main funders of proposed Amendment Three to the Florida Constitution. This Amendment, entitled “Voter Control of Gambling in Florida”, takes away from the Legislature much of the Legislature’s authority to amend gambling laws in Florida (the extent of which is uncertain), and instead requires a “citizens’ initiative pursuant to Article XI, section 3, in order for casino gambling to be authorized under Florida law.”
Many people mistakenly believe that the “casino gambling” referred to in Amendment Three is limited to bringing in big new casinos. The wording of the Amendment cross-references 25 CFR 502.4, and includes
(a) Any House banking game, including but not limited to –
(1) Card games such as baccarat, chemin de fer, blackjack (21) and pai gow (if played as house banking games;
(2) Casino games such as roulette, craps, and keno
(b) Any slot machines as defined in 15 U.S.C. 1171(a)(1) and electronic or electromechanical facsimiles of any game of chance
(c) Any sports betting and pari-mutuel wagering, including but not limited to wagering on horse racing, dog racing or jai alai; or
(d) Lotteries
The wording of the amendment specifically exempts pari-mutuel wagering by stating “As used herein, ‘casino gambling’ does not include pari-mutuel wagering on horse racing, dog racing, or jai alai exhibitions.” Note that there is no exemption in Amendment Three for the lottery language listed in 25 CFR! Depending on how Amendment Three is interpreted, this could have a significant negative effect on the Florida Lottery.
It is unclear what the actual effect of Amendment Three would be if it passes. This could be the Gaming Attorney/Administrative Law Attorney/Appellate Attorney full employment act. The Amendment may or may not be retroactive, meaning that it may or may not prevent types of gambling that are already legal in Florida. As the Florida Supreme Court determined when they ruled that the language could go on the ballot:
“The opponents primarily argue that the Initiative should not be placed on the ballot because it is unclear whether, if passed, the amendment would apply retroactively and what effect, if any, the amendment would have on gambling that is currently legal in Florida—including gambling that was previously authorized by general law rather than by citizens’ initiative. However, as the sponsor points out, the opponents’ arguments concern the ambiguous legal effect of the amendment’s text rather than the clarity of the ballot title and summary.” (Florida Supreme Court SC16-778, SC16-871)
Thus, the Florida Supreme Court specifically stated that the Amendment has “an ambiguous legal effect” and declined to rule whether or not the amendment is retroactive. If they haven’t determined if it’s retroactive, and say it’s ambiguous , how can voters know what it will do?
The wording of Amendment Three states that “Florida Voters shall have the exclusive right to decide whether to authorize casino gambling in the State of Florida.” What does that mean? Slot machines at Pari-Mutuels in Miami-Dade and Broward Counties are authorized by the Florida Constitution. Would it require a new Constitutional amendment to authorize it in different Counties, or at locations other than Pari-Mutuels? The Florida Lottery has certain types of games. Would a new Constitutional Amendment be required to change the tickets, add locations, or sell the tickets in a new style? Could the Florida Lottery use its existing authority to add keno? Would “skill-based gaming” be permitted as a variation on slot machines, or would they require a new constitutional amendment? Can slot machine manufacturers even bring out new styles or themes of slot machines? There are far more questions than answers.
If Amendment Three is construed broadly, so as to require an initiative for any new types of gambling in Florida, I believe that would eventually bring gambling at Florida’s pari-mutuels to an end. A few decades ago, slot machines were electromechanical. Today they are electronic, and video poker, video blackjack, etc. have been determined to be slot machines because they contain random number generators. I can’t predict what new types of gambling will occur in the decades to come, but I do know that there will be new types of gambling, and if the Seminoles and/or the rest of the U.S. can keep up, but the Florida pari-mutuels and Florida Lottery can’t, then the pari-mutuels and Lottery will fall by the wayside. Would any significant number of people gamble today at a quasi-casino that only had electromechanical games?
Amendment Three could be construed more narrowly and be interpreted as saying that this would only prevent new people from entering legal gambling in Florida. It could be interpreted as saying that because Florida’s current Constitution specifically permits casino gambling at pari-mutuels and specifically permits the Lottery, that casino gambling is already permitted at those locations (maybe just in Miami Dade and Broward, maybe not). Therefore, while no other new operators can be permitted to operate places where casino gambling as defined above occurs, any type of casino gambling would be permitted at the current locations authorized in Florida’s Constitution. It is impossible to tell at this time what the Amendment actually does.
Also, the wording of the amendment seems perhaps intentionally confusing. As a County Commissioner in Broward County, Florida, and a former State Senator, I am frequently asked questions about the proposed amendments. Broward has generally been supportive of casino gambling. Many people seem to be supporting this amendment because they are supportive of expanded gambling in Florida, frustrated with the inability of the Florida Legislature to expand this gambling, and therefore believe that passing this will give more local control, enabling the voters of Broward to pass expanded gambling.
The summary of the Amendment says that “Florida voters shall have the exclusive right to decide whether to authorize casino gambling”, but unless you follow the cross-reference to Article XI, section 3 of the Florida Constitution, the summary never explains whether the vote is a local vote or a Statewide vote. For example, the Platform Subcommittee of the Broward Democratic Party voted to support Amendment Three, because “#Homerule. Gives citizens the right to decide on casinos being built in their cities, instead of Tallahassee”. That is almost exactly the opposite of what the Amendment does. When I explain that Amendment Three requires a statewide petition drive, followed by a statewide vote (not a local vote) and passage by 60%, Broward voters seem horrified, and then oppose it. Please note that the Supreme Court ruling permitting the existing wording was approved by a vote of 4-2. Two Supreme Court Justices ruled that the Ballot Title and Summary were misleading.
In order to begin the initiative required by Amendment Three, it would require signatures from 8 percent of the voters in each of ½ of the state’s Congressional districts, and 8% of the total voters statewide, based on the number of votes cast in the last Presidential election. This is an amazingly high bar, and normally requires an extremely high expenditure of funds for paid petition gatherers. The Supreme Court of Florida would have to approve the wording of the proposed Petition. If all of this occurs, the proposed initiative would need 60% of the votes cast in order to pass. It is worth noting that many experts believe that Amendment Three will pass despite these obstacles. As of the date that I write this, it is estimated that the supporters of Amendment Three have raised over $27 million dollars, without any well-funded opposition thus far.
It seems quite clear that if Amendment Three does pass, it would be extremely difficult and expensive to try and rewrite the Constitution again to undo or amend this language to permit additional types of “casino gambling” in Florida. It is clear that an investment of tens of millions of dollars would be required to attempt to change the gambling laws, with no guarantee of success. Few if any companies would be willing to make that commitment. It may make sense for the Seminole Tribe to invest over ten million dollars because if Amendment Three passes, they believe that they would have a monopoly on all new types of gambling on Florida, including Sports Betting. It would make far less economic sense for any one company, which would be one of many companies engaging in gambling in Florida, to put up similar dollars without the same exclusivity that the Seminoles (and potentially the Miccosukees) would enjoy.
Finally, one of the biggest questions remaining is whether or not the Seminole Tribe of Florida may suffer from the law of Unintended Consequences. The Seminole Tribe clearly intended Amendment Three to not apply to Seminole Gambling. The wording of the Amendment states “In addition, nothing herein shall be construed to limit the ability of the State to negotiate gaming compacts pursuant to the Federal Indian Gaming Regulatory Act…”(emphasis added) However, because of the wording that is used in the Amendment (and in a twist that only Lawyers can love), this may not be sufficient.
On November 14, 2007, and against my advice, Governor Charlie Crist signed a “Compact” with the Seminole Tribe of Florida. Former Governor Crist is a close friend, and I warned him in advance that the Governor does not have the authority to enter into a compact under the Indian Gaming Regulatory Act (IGRA). The Governor has the authority to negotiate a compact, but he does not have the authority to execute the compact without Legislative approval. When Crist signed the Compact, he was sued five days later by the Florida House of Representatives. The Florida Supreme Court decided this issue in Florida House of Representatives v. The Honorable Charles J. Crist, Jr., (999 So. 2d 601). The Court chose not to take up the general question of whether the Governor has the authority to enter into a Compact with Florida Indian tribes under any circumstances without Legislative approval, although they cited to several other State and Federal decisions, and in each cited case, the Governor was ruled not to have such authority. Following judicial principles of deciding cases on narrow grounds when possible, the Supreme Court ruled that it would violate the Constitutional Separation of Powers for the Governor to enter into a compact with the Indian Tribes when the compact gives the Indians a type of gambling otherwise illegal in Florida. The Court stated at page 613:
“The House claims that the Compact violates the separation of powers on a number of grounds.8 We find one of them dispositive. The Compact permits the Tribe to conduct certain Class III gaming that is prohibited under Florida law. Therefore, the Compact violates the state’s public policy about the types of gambling that should be allowed. We hold that, whatever the Governor’s authority to execute compacts, it does not extend so far. The Governor does not have authority to agree to legalize in some parts of the state, or for some persons, conduct that is otherwise illegal throughout the state.”
Crist negotiated a Compact with the Seminoles, but it required Legislative approval or ratification. The wording of Amendment Three only exempts negotiation of a Compact from Amendment Three. Of course, the New Governor of Florida will be able to negotiate a compact with the Seminole or Miccosukee tribes, as Governor Crist did. However, there is nothing in the language of Amendment Three that appears to exempt Legislative approval or ratification from Amendment Three. I believe that it would have been far clearer if Amendment Three said ““In addition, nothing herein shall be construed to limit the ability of the State to negotiate and ratify gaming compacts pursuant to the Federal Indian Gaming Regulatory Act…”(emphasis added). The word ratification is missing from Amendment Three. I know that the Seminoles feel that the wording of Amendment Three is sufficient to cover both negotiations and ratification. I know that other Lawyers who I respect have a different opinion. I offer no conclusion here, but I believe that this is another ambiguity which may need to be decided by the Florida Supreme Court, if Amendment Three passes by the required 60% vote.
Geller speaks at NCLGS on the potential effect of Sports Betting on Pari-mutuels (summary below) and Webinar for GiGse on Sports betting
Since my last Post, I’ve spoken to the National Council of Legislators from Gaming States (NCLGS) on July 13 in Cleveland, Ohio, on “the potential impact of Sports Betting on Pari-mutuels”. On July 26 I was a panelist on a GiGse webinar entitled “U.S. Sports Betting & Wire Act – addressing key issues and questions for a successful regulation and operation of sports betting roll-out across states.”. It seems that sports betting is the flavor of the day in Gambling seminars. This post will deal with my NCLGS comments. I intend to post soon on my GiGse webinar comments.
At NCLGS, I pointed out that the absolute fiscal impact of sports betting at the Pari-Mutuels is likely to be negligible, but that the opportunity is great. Let me elaborate.
Nobody knows what is the total amount of wagering that currently occurs on sports betting. The most common numbers I’ve seen are between $100 and $300 billion, so let’s assume it’s $200 billion. Much of that is “sticky” meaning it will stay where it is, with illegal bookies and in office pools, etc. This is even more likely to occur if there are high taxes on sports betting. On the other hand, there may be large untapped demand, which would expand if sports betting is legalized. Anyone that pretends to know what the actual number is probably is just making it up…, excuse me, I meant to say is simply doing exact calculations on an inexact number, to come up with an educated projection. In other words, making it up. However, most of that expansion would occur in Internet sports betting, which, as I will explain in my comments on the GiGse webinar, is probably illegal. Since I can make up numbers as well as anyone else, my scientific calculation is that there will be approximately $150 billion in Sports betting. Just guessing.
The takeout (Gross Gaming Revenue, or GGR) on sports betting is generally around 4-7% in Las Vegas casinos. Let’s assume 5%. 5% of $150 billion is $7.5 billion. If states increase the takeout much more than that, too much of the gambling will stay illegal. If states raise tax rates above a certain unknown number (10-20%??), they will make it unprofitable for operators. Let’s just assume that the state tax rate is 12%, the Federal excise tax rate is .25% of the wagering (not the GGR), the sports leagues and individual teams ask for their percentage (either of GGR or wagering), and we see that there’s not a lot left for the operators to make money on. In Nevada, the expenses for running sports gambling before taxes and the other issues I’ve discussed approach 50%. Further assume that Nevada will continue to attract most big rollers for sports wagering, and we can see that there isn’t much left to spread around as profit for individual operators in the rest of the Country.
However, there is some good news for pari-mutuel operators, if they take advantage of it. I believe that at least initially, most states will restrict sports betting to their existing licensed gambling facilities. I think that this will occur because the existing facilities have substantial political clout in their states, because Internet sports wagering may be illegal (because of the Wire Act, which wasn’t thrown out when PASPA was), and because of a desire to at least start in a more conservative fashion. In Las Vegas, we’ve seen that sports betting isn’t that big of a revenue generator for the casinos. The casinos use sports betting to attract customers to their casinos, and they do this well. If pari-mutuels around the country take advantage of this, upgrade their facilities, diversify their gambling base, and use sports betting to attract new customers, then sports betting may indeed be a huge boost to pari-mutuels. I won’t hold my breath.
Geller to speak at Summer Meeting of National Council of Legislators from Gaming States (NCLGS)
I was the Founder and National President of the National Council of Legislators from Gaming States (NCLGS), and I remain as Senior Adviser and Special Counsel to NCLGS today. I will be speaking on Pari-Mutuels and Sports Betting at their upcoming summer conference in Cleveland. Enclosed below is a Press release with the details of this meeting.
Legislators from Gaming States Announces Roster of Expert Speakers for July 13-15 Summer Meeting in Cleveland
(PRNewsfoto/National Council of Legislators)
NEWS PROVIDED BY
National Council of Legislators from Gaming States
Apr 24, 2018, 11:15 ET
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CLEVELAND, April 24, 2018 /PRNewswire/ — The National Council of Legislators from Gaming States (NCLGS) today announced the roster of speakers for its Summer Meeting that takes place July 13-15 in Cleveland. Registration is open to the public.
“Our slate of speakers includes many of the most respected and thought-provoking experts from different fields, including regulators, gaming operators, attorneys, financial analysts, problem-gambling specialists, and other gaming-related professionals,” said incoming NCLGS President William Coley, a senator from Ohio. “Everyone with a stake in the future of legalized gambling – in any form – should join dozens of state legislators and attend our Cleveland meeting.”
In addition to legislators who will chair Committee sessions, the following experts will speak in Committee and general sessions:
Andy Abboud, VP, Government Relations & Community Development, Las Vegas Sands
Joe Asher, CEO, William Hill US
Karl Bennison, Chief, Enforcement Division, Nevada Gaming Control Board
Dennis Berg, Director, Ohio Lottery
Byron Boothe, Vice President, Government Relations, Intralot
Michael Burke, Executive Director, Michigan Association on Problem Gambling
Anthony Cabot, Distinguished Fellow, University of Nevada-Las Vegas, William S. Boyd School of Law
Richard Carter, CEO, SBTech
Heather Chapman, Supervisory Psychologist/Director Gambling Program, Louis Stokes Cleveland VA Medical Center
Andy Cunningham, Director Global Strategy Integrity Services, Sportradar
Brian Egger, Senior Gaming & Lodging Analyst, Bloomberg Intelligence
Steve Geller, Esquire, Geller Law Firm
Ken George Jr., Chair, Forest County Potawatomi Gaming Commission
Will Green, Senior Director, Research, American Gaming Association
Becky Harris, Chair, Nevada Gaming Control Board
Mark Hemmerle, VP, Legal and Compliance, Worldpay Gaming
Jeremy Kleiman, Member, Saiber LLC
Derek Longmeier, The Problem Gambling Network of Ohio, Executive Director
Tim Lowry, Partner, DLA Piper
John Maddox, Vice President Government Relations & Development, Caesars Entertainment
Art Manteris, Vice President, Race & Sports Operations, Station Casinos
Stephen Martino, Senior Vice President & Chief Compliance Officer, MGM Resorts International
Christopher McErlean, Vice President – Racing, Penn National Gaming
Dan Metelsky, Public Gaming Strategist and Public Policy Leader, Public Gaming Creative Strategies
Kevin Mullally, Vice President of Government Relations & General Counsel, GLI
Dave Payton, Vice President of Sales, AmTote International
Michael Pollock, Managing Director, Spectrum Gaming Group
F. Douglas Reed, Senior Pari-Mutuel Associate, Spectrum Gaming Group
Tim Richards Chief Product Strategy Officer, Everi
Lindsay Slader, Operations Manager, Geocomply
Ernie Stevens Jr., Chair, National Indian Gaming Association
Lovell Walker, Executive Director of Interactive Gaming Development, MGM Resorts International
Daniel Wallach, Shareholder, Becker & Poliakoff
Joseph Weinert, Executive Vice President, Spectrum Gaming Group
The NCLGS Summer Meeting agenda includes:
Six legislative committee sessions: Casinos, Emerging Forms of Gaming, Lotteries, Pari-Mutuels, Responsible Gaming, and State-Federal Relations
Two Masterclass panels conducted by the International Masters of Gaming Law focusing on sports betting and online gaming
Special general session panel examining the economic impacts of gaming
Friday evening welcome reception
Saturday afternoon tour of Intralot’s facility serving the Ohio Lottery
Optional Saturday night baseball game (via separate registration fee at special group rate): New York Yankees at Cleveland Indians
To view the agenda, register, and book hotel rooms at the host Marriott at special attendee rates, visit http://www.nclgs.org/meetings.html.
For sponsorship information, contact Dawn Wagner at dawn@nclgs.org. Legislators and others seeking NCLGS membership information should contact Wayne Marlin at wayne.marlin@nclgs.org.
NCLGS is the only organization of state lawmakers that meets on a regular basis to discuss issues relating to gaming. Members of NCLGS serve as chairpersons or members of state legislative committees responsible for the regulation of gaming in their state legislative houses. NCLGS does not promote or oppose gaming but is primarily concerned with the regulation and economic and social impacts of the industry. The NCLGS Foundation is the educational and research arm of NCLGS. The 501(c)(3) non-profit is a source of non-partisan data on issues of gaming legislation and regulation.
Spectrum Gaming Group, which has performed advisory and consulting work for gaming operators, regulators and legislatures in 36 US states and territories and in 47 countries on six continents, serves as the Executive Director of NCLGS.
SOURCE National Council of Legislators from Gaming States
Related Links
http://www.nclgs.org
Will the Florida Legislature Call a Special Session in the near future to try and pass a gambling bill?
There has been discussion of whether we will have a Special Session in Tallahassee to discuss and hopefully pass comprehensive gambling legislation. I will discuss the possibility of whether a Special Session will be called, and, if so, whether or not it will result in actual legislation.
During the twenty years that I served in the Florida House and Senate, I learned the most basic rule of Special Sessions: “Don’t call one until you have an agreement on what the Legislature will pass.” I can say definitively as of today that the Legislature has not reached an agreement (yet), so as of today, they will not be calling a Special Session.
There are reasons why a Special Session may be called. There is a proposed amendment to the Florida Constitution known as Amendment Three which would take away from the Legislature most authority to amend gambling legislation and would instead require voter approval of any changes. This Legislation has been largely funded by the state Amusement Park industry (especially Disney), and has also received substantial support from the Seminole Indian Tribe. I will write more about Amendment Three in a future blog post, but it is sufficient for now to say that many in the Legislature think that a Special Session may be their last chance to make major revisions to the gambling laws of Florida.
Another reason to call a Special Session is more basic politics: Money. Fundraising. The Florida Legislature has finished its Regular Session and is not scheduled to meet again until after the November elections. The current Speaker of the House, Richard Corcoran, is widely believed to be running for Governor of Florida, although he hasn’t formally filed yet for that position. His best remaining chance of substantial fundraising is from the Gambling industry, if there are discussions of having a Special Session. The two negotiators from the House and Senate on gambling are Speaker-Designate Jose Oliva, and President-Designate Bill Galvano. Their duties as Speaker/President Designates are to raise money for their candidates in their respective Chambers. I regard all three people I’ve mentioned as honorable people, but the ability to raise some additional money for their caucuses should not be overlooked.
I have been told that the current President of the Florida Senate, Joe Negron, who is not running for anything and who has even discussed resigning his seat in the Senate when his term as President is up, has given a deadline to reach an agreement, as he doesn’t want this issue lingering. I was told that the original deadline expired last week, and that the Designates have a short time remaining to reach an agreement. As an aside, I must add an editorial comment that I think Joe Negron has been a great Senate President, and I personally would hate to see him resign and miss his last two years in office.
At the end of the day, I believe that there either will be no Special Session, or the Special Session will be unsuccessful. They’re simply too far apart. The Speaker, who certainly has been sounding like he’s running for Governor, needs to try and be the most conservative guy in the room to do well in a Republican primary. That means he needs to at least sound like he’s passed a conservative bill, reducing gambling. The Senate has been in favor of permitting slot machines in the approximately eight other counties where referendums have passed permitting slot machines, and the Senate has also been in favor of continuing “designated player games”, also known as “player-banked games”, as opposed to House-banked games. Those at least sound like expansions of gambling, and the proposed compromise of closing down some dormant pari-mutuel permits sounds like an insufficient reduction to be seen as a reduction in gambling, if the other items are added.
Many legislators don’t seem to understand the concept of exclusivity under the Indian Gambling Regulatory Act (IGRA). The Seminoles are currently paying the State of Florida nearly three hundred million dollars per year. In exchange for this, the Seminoles have been given statewide exclusivity on house-banked card games, and regional exclusivity on slot machines. Some legislators seem to think that slot machines can be expanded statewide without affecting the regional exclusivity, and thus the required payments under the existing Seminole Compact. I believe that they’re wrong.
When considering how far apart the House and Senate are, and when further adding in the affect that offering additional slot machines to pari-mutuels throughout the State would have on the Seminole Compact, I believe that there either will be no Special Session on Gambling, or, if there is, it will be unsuccessful.
Florida House of Representatives Majority Leader files major Gambling bill; Article on showdown over Seminole gambling agreement quoting me; McCain calls for re-examination of PASPA; Poarch Creek band of Indians threatens to sell marijuana from their Florida land if not given gambling; Comprehensive gambling deal in Florida described as “Enormous, Gargantuan Lift; Quotes from Orlando Sentinel gambling panel; Geller speaks at NCLGS
• Florida House of Representatives Majority Leader Dana Young filed a major re-write of gambling laws in Florida on March 2. This bill is over 320 pages, and will permit destination resorts, historic racing, and many other types of gambling in Florida. We will print a more complete analysis of this bill after we have time to review it, and see what the official Bill analysis says.
• Nick Sortal, the excellent gaming columnist in the Fort Lauderdale SunSentinel, wrote a column entitled “Showdown looming over Seminole gambling agreement.” One of the experts quoted in that article was … me. Sortal quoted Geller as saying “The one thing I can tell you with pretty good certainty is that anybody that tells you with certainty that they know what’s going to happen is wrong”.
• United States Senator John McCain has said that the U.S. Congress needs to reexamine the Federal ban on sports wagering [PASPA]. According to the Washington Post, McCain said “We need a debate in Congress… We need to have a talk with the American people, and we need to probably have hearings in Congress on this whole issue so we can build consensus.”
• The Poarch Creek Band of Indians (Poarch) is an Alabama-based tribe that owns about one acre of land in near Pensacola, Fl, where it is claiming the right to build a casino. According to the Associated Press, the Poarch currently operate a casino in Atmore Alabama, a few miles away from the Pensacola site. The Poarch are not currently a Federally recognized tribe in Florida, but they contend that they have the right to have casino gambling in Florida, based on the amount of time that the Florida land has been owned by the tribe. The Governor Rick Scott administration disagrees, stating that it is ‘premature” to negotiate with the Poarch until they have the necessary Federal recognition in Florida. The AP states that the Poarch are threatening to take advantage of a December opinion by the U.S. Department of Justice which will permit Tribes to raise and sell marijuana on their tribal property, and are stating that they will consider doing this in Florida if the Poarch do not get “a seat at the table” on Florida gambling issues.
• News Service of Florida has published a lengthy analysis of the difficulty in passing a comprehensive gambling bill under the headline “Gambling Deal ‘Enormous, Gargantuan Lift’ This Session”. That quote was from Rep. Dana Young. The article talks about Senate President Andy Gardiner’s repeated statements that he is fine with the Legislature doing nothing this year, and letting that portion of the Seminole Gaming Compact dealing with banked card games “sunset”, or expire. Gardiner has appointed Senate Majority Leader Bill Galvano as the lead on gambling for the Florida Senate. Galvano was the lead for the Florida Legislature five years ago when the Seminole Gaming Compact was originally approved [Although not in the article, it should also be noted that Galvano is currently national Vice-President of the national Council of Legislators from Gaming States (NCLGS), and is expected to become President of that group in 2016]. The article quotes Galvano extensively. The article goes on to say that “any gambling measure runs the risk of being overloaded with wish lists from industry operators, including pari-mutuels in Broward and Miami dade Counties that already have slots but want a lower tax rate and card games to better compete with the nearby Seminole Hard Rock Hotel and Casino in Hollywood.”
• Nick Sortal also wrote an interesting piece in the SunSentinel, including interesting quotes from many top players in the gambling debate from a panel discussion hosted at the Orlando Sentinel, the sister paper of the SunSentinel. Among those quoted were Geoff Freeman, President of the American Gaming Association; Mark Wilson, President of the Florida Chamber of Commerce; John Sowinski, President of CasiNos.org; and Izzy Havenick, a member of the family that owns Magic City Casino in Miami, as well as having other Florida Pari-mutuel interests.
• Since I mentioned NCLGS earlier, I want to point out that they had a very successful conference in Las Vegas in January. I spoke on three topics at their committee meetings, which may be a record for any single speaker. I spoke on updates in pari-mutuel technology, pari-mutuel decoupling, and gave an update on Indian gaming state compacts and Tribal recognition. The next NCLGS meeting is in June in Atlantic City.
Greenspoon Marder and Steve Geller play major roles at Florida Gaming Conference; Questions arise as to whether portions of the Seminole Gaming Compact will be renewed; NBA commissioner Adam Silver writes in favor of legalizing Sports Wagering; Florida Revenue Estimating Conference meets, discusses impact of Dania Casino and Seminole Compact; “Adult Arcade” raided in North port, Florida, attorney claims arcade completely legal.
- Greenspoon Marder was the Presenting Sponsor at the Florida Gaming Conference, hosted by Spectrum Gaming, held November 10 and 11 at the Hyatt Hotel in Downtown Miami. I Spoke on the panel “Gaming Outside of South Florida – The Right Move?”, Moderated the panel “Legislative Update – What’s Next for Florida”, and introduced both Keynote Speakers, Senator Maria Sachs, and City of Miami Mayor Tomas Regalado.
- Numerous stories were written about the Florida gaming congress, including by Nick Sortal from the Fort Lauderdale Sun Sentinel, who wrote about the fears that the South Florida Casino market is saturated, and Nick Wingfield, who wrote that Churchill Downs is buying mobile games company Big Fish Games.
- Probably the biggest issue facing Florida this year is whether or not that portion of the Seminole Compact restricting anyone other than the Seminoles from having banked card games will expire or be renewed. The Compact has a 20 year term, but that portion dealing with banked card games and increased revenue sharing was only for 5 years, and expires in 2015. The Tampa Tribune wrote an article entitled “New Senate head puts tribal gaming into question”, which discusses the possibilities that the Compact may not be renewed. Although Governor Rick Scott, a proponent of the Compact, was re-elected, the article discusses that the Legislature may be more assertive on these issues this year, and may not be supportive of extending the Compact. The new Senate President, Andy Gardiner, is from Orlando, where Disney World, which opposes gambling, is influential. Gardiner opposes gambling, and has said that with Florida’s recovering economy, he is prepared to do without the Seminole revenue sharing. Senate Majority Leader Bill Galvano, who is expected to play a major role in any gambling bill, says that when the Senate discusses the Compact, he expects that all other gambling issues will be discussed as part of compact negotiations.
- NBA Commissioner Adam Silver has written an op-ed in the New York Times stating that wagering on NBA games should be legalized. This is the first time that I have seen that the head of any Major League Professional Sports League in the United States has come out in favor of legal sports wagering, which would violate the Professional and Amateur Sports Protection Act (PASPA). Silver said that Congress should pass legislation to tax, regulate, and reform wagering on Sports betting. Silver did not provide specifics on what type of legislation he would like to see.
- The Washington Post wrote an excellent story talking about Silver’s call for legal sports gambling, and wrote about the history of sports and gambling, including a discussion of where sports gambling stops and fantasy sports wagering begins.
- The Tampa Bay Times covered the meeting of the State of Florida Revenue Estimating Conference, which estimated that the closing of Dania Casino and Jai Alai should cost the state about $3 million dollars in lost tax revenue. The Revenue Estimating conference described that loss as relatively insignificant compared to the potential loss if Florida does not renew the Seminole gaming Compact.
- The Sarasota Herald Tribune wrote an article which demonstrates the difficulty in enforcing the laws against internet cafes and “adult arcades” in Florida. Law enforcement agents raided “The Spin Depot”, a North Port, Florida arcade. Law enforcement removed machines and records from the arcade. Three people, including a former City Commissioner, were booked into the County Jail. The attorney defending the arcade and the Commissioner stated that he believed that the business “operated lawfully as an arcade amusement center and that no illegal activity took place.
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