An analysis of Florida HB 1233, the major gambling bill introduced by House Majority Leader Dana Young
Departing from my normal custom of covering multiple items in each blog post, this post will be limited to a description of HB 1233, the major re-write of Florida gambling law filed by Florida House of Representatives Majority Leader Dana Young. This will also include some initial reaction to the bill. The post is based on articles from the Miami Herald, the Tampa Tribune, the Associated Press, and my own reading of the bill. Fair warning: The bill is 316 pages. I am only listing some of the highlights of the legislation, and there are certainly fine details in the bill which will only become apparent after close study.
The bill includes the following issues:
- It permits Historic Racing, which are few second snippets of real races, without any identifying information as to which races are being shown. This has proven very profitable in other states. The tax rate in this bill on Historic Racing is an unusually low 2%. This would be permitted even at pari-mutuels outside of Miami-Dade and Broward.
- There are tax changes which encourage greyhound simulcasting and ITW, and discourage live racing. Live greyhound racing will no longer be required to have cardrooms or slot machines.
- There is extensive language pertaining to medication of racing animals.
- There are requirements for reporting of racing greyhound injuries. Similar legislation to this section passed the Florida Senate on the first day of the Legislative Session this week.
- The bill clarifies what types of unregulated “wagering” are permitted at locations such as Dave and Busters and truck stops. It further clarifies that the types of machines commonly found in “adult arcades” are illegal.
- It establishes a Gaming Control Commission, which will assume control over regulating most types of gaming in Florida, and sets forth strict ethical requirements.
- It will permit slot machines at pari-mutuels in counties that meet certain criteria. It appears that the only two counties that meet this description are Palm Beach and Lee counties.
- It will permit up to two “destination resorts” in counties that meet certain criteria. It appears to say that there can be no more than one destination resort in any county, and that the only two counties that meet the criteria are Miami-Dade and Broward counties. The bill preempts local regulation of the destination resorts. The bill requires an additional $ Two Billion Dollars of investment, although every fiscal analysis I’ve ever seen for a Broward destination resort implies that it will be very difficult to justify that large of an expenditure in Broward. It requires a full waiver of sovereign immunity if a bidder is an Indian tribe. It sets forth a lengthy selection process for qualifying to bid, and criteria for judging the successful bidders. It sets forth taxes and fees. It limits the “gaming floor” to 10% of the resort.
- In the event that destination resorts are established, it will reduce the tax rate on slot machines at the Miami -Dade and Broward pari-mutuels from 35% to 25%.
- It requires compulsive gambling programs.
- It makes portability of existing pari-mutuel permits more difficult, and makes it more difficult to create new pari-mutuel permits.
- The bill males little reference to the Seminole Tribe of Florida.
The Legislation is far more comprehensive than any legislation filed or contemplated in the Florida Senate, and Senate leaders do not seem very receptive to the Legislation. John Sowinski, a leading opponent of gambling in Florida, referred to the bill as “the biggest expansion of Gambling in Florida history.” No Casinos, Inc. is purchasing television ads to oppose the Legislation, while the Seminole Tribe of Florida is purchasing television ads to support the renewal of the Seminole Gaming Compact, which would largely be gutted if the bill is adopted.
The bill can be seen its entirety at http://www.myfloridahouse.gov/Sections/Bills/billsdetail.aspx?BillId=54451
Is the Seminole Tribe considering unionizing their Florida casinos?; Additional debates on economic impact of Florida gaming; Renewed questions about the renewal of the Seminole gaming Compact; Legislation filed to permit on-line Florida Lottery ticket sales; Instant Racing proving sucessful in Idaho
- A current rumor circulating in Florida is that The Seminole Tribe of Florida may consider unionizing their Florida Hard Rock casinos and hotels. According to Sunshine State News, the Seminole Tribe of Florida has partnered with the Menominee Tribe of Wisconsin to open a Hard Rock casino in Wisconsin, and has entered into “card check” agreements with two unions there. Of course, even under Republican Governor Scott Walker, Wisconsin has a Legislature that is considered more favorable to Organized Labor than is the Florida Legislature.
- Once again, the economic impact of gaming in Florida is being debated. Nick Sortal writes in the South Florida Sun Sentinel about conflicting opinions between the America Gaming Association (AGA) and No Casino’s, Inc. The AGA commissioned a study by Oxford Economics, (part of Oxford University in England) showing that the Dade and Broward pari-mutuels with racinos employed 3,453 people and generated $1.2 billion in economic impact. As the AGA represents the private casino industry, it is not surprising that the report does not include the Seminole or Miccosukee casinos, pari-mutuels in other parts of Florida, the Florida Lottery, etc. John Sowinski, the President of No Casinos, stated that that “The slot revenues run the State of Florida for about 18 hours. It is a blip on the screen, a rounding error.” He stated that the spending was money that Floridians would otherwise have spent on other discretionary areas.
- Capitol News Service of Florida has also recently stated that the future renewal of the Seminole Gaming Compact is uncertain. These rumors continue. Please see my last post for additional details.
- WEAR, Pensacola, has reported on the possibility of online sales of Lottery Tickets in Florida. Senator Gwen Margolis of Miami has prefiled a bill which would authorize such sales. Opposition to the bill was reported from both conservative opponents of gambling and from convenience stores, which are concerned that online sales could draw sales away from convenience stores. Although commissions on sales of lottery tickets are relatively low, there is a belief among at least some convenience stores that the sale of lottery tickets brings in patrons who also buy higher margin objects.
- Instant Racing in Idaho has started off very well, raising both praise and concern. According to an Associated Press article by Kimberlee Krueski, 200 Historic Racing machines at Les Boies Park, (a pari-mutuel located near Boise, Idaho), are collecting millions of dollars a month. In October of 2014, for example, the amount wagered was over $7.2 million dollars. The Idaho Racing Commission has determined that Historic Racing, a/k/a Instant Racing, where the last few seconds of races are shown on individual screens and individual betting is permitted, does not violate the Idaho Constitutional ban on slot machines. Although this type of gambling has been supported by the pari-mutuel industry, and passed by the Idaho Legislature, some opposition has recently surfaced. The Coeur d’Alene tribe, which originally did not oppose Instant Racing, and at least some Conservative Legislators, now oppose Instant Racing after seeing how successful it has become. Editors note – Historic Racing machines have been discussed in Florida as a possibility for the pari-mutuels outside of Miami Dade and Broward Counties.
Historic Racing, Florida International University partners with City University of Macau, No Casinos releases list of Legislative candidates signing anti-gambling pledge
- One of the types of gambling expansion that Florida discussed during this year’s Legislative Session involved “historic racing”. Historic racing is a type of electronic gambling where bettors wager on real previous pari-mutuel races, from which the identifying information has been removed. This means that the wagering is primarily a game of chance, while viewing the end of a real race. Although not as fast as slot machines, they can still have several wagers in a minute. Florida is not the only state considering historic racing. According to the Austin American-Statesman, a State Representative in Texas has written to the Texas Attorney General, seeking an opinion as to whether the Texas Racing Commission has the authority to approve historic racing without specific legislative authority.
- Miami Today has published a story about a partnership between Florida International University (FIU) and City University of Macau. The story speculates about a relationship in which FIU’s Hospitality and Tourism Management program may work with Macau’s large gambling and hotel industry.
- No Casinos, a Florida based anti-gambling group, released a list of Florida Legislative candidates who signed the group’s anti-gambling pledge. The Tampa Tribune has provided the story and a list of those candidates. While most of the candidates are in conservative rural areas of the state, or in the Greater Orlando area where the existing tourism industry is strongly anti-gambling, I note that several of the candidates are from Miami-Dade or Broward counties. It is probably not a smart political move for candidates from South Florida (where support for legal gambling is strong) to have taken take this pledge.