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Seminole Tribe, Gov. Rick Scott tie $1.8 billion expansion to gambling compact, job creation

Seminole Tribe announces $1.8 billion expansion plan

Gov. Rick Scott sat in on the Seminole Tribe's announcement of a $1.8 billion expansion to its Hollywood and Tampa complexes on Monday, Feb.1, 2016. The plan would include an 800-room guitar-shaped hotel and create 4,000 permanent jobs. But, the
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Gov. Rick Scott sat in on the Seminole Tribe's announcement of a $1.8 billion expansion to its Hollywood and Tampa complexes on Monday, Feb.1, 2016. The plan would include an 800-room guitar-shaped hotel and create 4,000 permanent jobs. But, the

Gov. Rick Scott and the Seminole Tribe of Florida are betting the Florida Legislature will approve a compact between the state and the tribe, and they’re betting big — $1.8 billion guitar-shaped hotel big.

The tribe outlined the details of the development at its Hollywood headquarters Monday to Scott, who was welcomed by the cheers of hundreds of Hard Rock employees. The $1.8 billion expansion plan was originally announced last spring, when the tribe began negotiations over the compact with the governor, and it continues to be touted as an economic reward for giving the tribe a statewide monopoly for certain casino games.

At the center of the proposal is the 800-room, 36-floor silver hotel, shaped like the body of a guitar rising from the Hollywood complex. The expansion also calls for five new restaurants, including a new Hard Rock Cafe, a buffet, dessert shop, nightclub and Swamp bar. If completed, as promoted, the tribe estimates the plan would create 19,452 jobs, including 4,867 full-time positions and 14,585 construction jobs, said Seminole Gaming CEO James Allen.

“We have created something that is, I think, an international tourist destination and an integrated resort that’s not just about gaming,” Allen said. “This will rival not just anything here in the state of Florida, but Atlantis [Paradise Island Resort in the Bahamas] and anything in the world.”

Allen said the hotel will feature Bora Bora-style cabanas, creating a space for guests to step straight from their room into a VIP pool. The plans also call for extended-stay villas to house guests, many expected to come from Latin America, who stay for months at a time.

The Seminole Hard Rock Tampa would also get a revamp, with a second, 500-room hotel tower and several new dining and retail options at that facility.

$1.8 billion Cost of expansion plan to Hard Rock hotels in Hollywood and Tampa

But the development hinges on a gambling compact between the state and the tribe, that although already approved by Scott, is facing opposition in the state Legislature, which must ratify any agreement. Neither the House nor Senate has drafted legislation to enable the compact amid steep opposition from the state’s existing gambling operators.

The 20-year gaming deal would give the tribe exclusive rights to operate blackjack, craps and roulette in its seven casinos in exchange for revenue-sharing payments, guaranteeing $3 billion to the state over seven years, beginning in 2017. The payments are based on a sliding scale that rises the more the tribe makes in profits.

Scott called it the “biggest compact ever signed,” and thanked Seminole tribal leaders for their help reaching an agreement.

“What the Seminoles have done in the state is remarkable,” Scott said at the announcement. “This compact will have a positive impact on job growth.”

Scott added that the compact would help preserve more than 3,500 jobs held by table games dealers and employees who are at risk of losing their jobs if a new compact is not agreed on. That’s because a five-year provision for card games such as blackjack and baccarat, which was part of the previous compact, expired in the summer.

We'll have a business model that’s about destination and entertainment, not just about somebody coming in and playing the slot machine.

James Allen, Seminole Gaming CEO

Several employees at risk of losing their jobs if the compact falls through spoke at the Hollywood event, including table games manager Patricia Rodriguez.

She was hired at the Hard Rock when she couldn’t find a job in the 2008 recession, allowing her to support her three kids. The compact’s future directly affects her, Rodriguez said.

“It would affect [me and my coworkers] immensely, from being a completely independent person who can provide for their family without a handout from the state to being completely dependent on the state,” Rodriguez said.

But, in exchange for the guaranteed revenue from Seminole Tribe, the compact also restricts the state from authorizing any expanded games sought by the parimutuel industry. The deal would retain the current prohibition against horse tracks, jai-alai frontons and dog tracks offering slot machines, except in Miami-Dade and Palm Beach counties, but would allow two additional facilities — one in Palm Beach County and another in Miami Dade — to add 750 slot machines.

The tribe, however, would be allowed to operate as many as 3,000 slot machines on average at each of its facilities and up to 6,000 machines at a single site.

Parimutuels, like Magic City Casino in Miami, argue that creates an unfair advantage that could “handcuff” their ability to deal with the state for another 20 years, said Magic City vice president Isadore Havenick.

“It would be the slow death of the parimutuel industry as a whole,” Havenick said. “It would put us at such a severe disadvantage with the tribe that a lot of us would not be able to compete in the long term. We are terrified for the future of our business.”

For the parimutuels, too, the future of the compact could mean the loss of jobs.

“What about the jobs of the thousands of people who are employed by the local parimutuel casinos? Why isn’t anyone concerned about those people’s jobs?” Havenick said.

Last year, the tribe proposed a similar $1.6 billion Hollywood and Tampa expansion — guitar-shaped hotel and all — that would create 4,000 permanent jobs, before its table games agreement was set to expire.

But the draft was submitted toward the end of the legislative session in March, Allen said, and the expansion was never negotiated in any committee hearings.

Now, he said, the tribe is “optimistic” it will reach an agreement with the state.

If so, the Hard Rock’s metallic guitar hotel could be joining the South Florida skyline as early as the summer of 2018.

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