Legislators hold the cards in new casino deal with Seminoles

This could be a lucky year for owners of dog tracks, horse tracks and even Miami’s resort casino promoters.

The state’s budget outlook is so good that Florida legislative leaders have suggested that they may not renew a key provision of the gambling agreement — known as the compact — between the state and the Seminole Tribe that allows the tribe to run blackjack tables and other banked card games at its casinos.

By rejecting an estimated $116million a year and reducing the games offered by the tribe, legislators could have new latitude to do something they have failed to do for the past five years: update the state’s outdated gaming laws and open the door to new gambling options from the tribe’s competitors.

Or, they could just be bluffing.

“It’s not out of the realm of possibility that the governor and Legislature end up doing nothing on the compact,’’ said Sen. Bill Galvano, a Bradenton Republican who will be the Senate’s point man on negotiations this legislative session.

He admitted it may be a ploy to get the tribe and everybody else to the table. “The loss of the banked card games is enough to motivate further negotiation,” he said.

Florida parimutuels and “destination resort” casinos have argued that expanding their businesses would be a better deal for the state than extending the tribe’s monopoly.

The tribe, by contrast, has argued that it can guarantee millions of dollars each year, but only if the state gives them something valuable — like exclusive games — in return.

Under the 2010 agreement, the tribe has the exclusive right to conduct three card games — blackjack, chemin de fer and baccarat — at five of its seven facilities in return for writing a monthly check to the state. The deal expires July 31, unless Gov. Rick Scott and lawmakers renew it.

Other compact provisions, which do not expire for another 15 years, give the tribe the right to operate slot machines at all its casinos — giving it a virtual monopoly outside Miami-Dade and Broward — in return for revenue sharing.

Federal Indian gaming law, which regulates agreements between the states and Native American tribes, requires that the tribe pay a reduced amount if the compact’s value is reduced.

“We don’t have a lot of room to bargain,’’ said Barry Richard, a Tallahassee lawyer who represents the Seminole Tribe and helped negotiated the 2010 agreement.

The Seminoles, for example, are hoping to secure financing for long-term capital projects, but bond rating companies want to know that the Legislature won’t come in and abrogate the compact, he said.

“They’ve got big projects on their books — which is good for the state, but in order to be able to finance them at reasonable rates they have to have long-term security,” Richard said. “They don’t want to have to fight a battle year after year.”

The governor has the sole authority to negotiate the compact but needs legislative approval to renew or revise it. To get enough votes, conventional wisdom says that the bill will have to include pieces to help the politically influential parimutuel industry. That gives legislators a strong hand.

“If we become engaged with a negotiation on the compact, and the reality sets in that the Legislature has to approve it, then all these constituencies will come out — parimutuels, destination resorts,’’ Galvano said.

As a result, each sector of the industry is hitching its hope on a different piece of the puzzle and the intense lobbying has already begun. Last week, as legislators met for the first week of committee meetings, parimutuel industry operators and their lobbyists flocked to Tallahassee to meet with legislators in a series of meetings.

The eight casinos in Miami-Dade and Broward want to add blackjack and lower their tax rates so that they can better compete with the tribe.

Animal rights activists are working with some dog track owners to push for “decoupling,” allowing tracks to end an 18-year-old requirement that allows dog tracks to operate poker rooms only if they run 90 percent of the number of races they ran in 1997.

Dog tracks in Palm Beach and Naples, which have won voter approval in local referendums to conduct slot machines, want the chance to install the games.

And outside casino investors such as Genting, and Las Vegas Sands, want the right to bring swanky “destination resort” casinos to South Florida.

While Galvano will be among the top senators on the issue, Rep. Dana Young, the House Republican leader and a Tampa lawyer, will be the House’s point person on gambling issues. “My job is not to make money for the special interests or make them feel good about the issue, my job is to make sure whatever we do, if we do anything, it is best for Florida,’’ she told the Herald/Times.

Young is a longtime advocate for ending greyhound racing, twice getting House approval to adopt a bill that would end the 18-year-old racing dates rule, known as “decoupling.” The proposal is a top priority of the animal rights industry which wants to end dog racing, but the measure has faced fierce opposition from the dog breeders and owners.

Although Young supports the issue personally, she said she can’t predict how it will play out in the House.

Young’s boss, House Speaker Steve Crisafulli, R-Merritt Island, twice voted in favor of phasing out dog racing but has remained non-committal about it this year.

Across the Capitol, Senate President Andy Gardiner, R-Orlando, a staunch gambling opponent, has indicated that he may be prepared to allow a vote in the Senate.

“I think it’s no secret where I stand on gaming, but in this role, it’s not my job to dictate to the members what we do,’’ he told reporters last month. “I can see a scenario where a bill can actually make it to the Senate floor where I can vote against it.”

Scott, who is authorized to negotiate the compact, has not begun discussions with the tribe yet this year, his office said Friday.

But last year, lawmakers scuttled a compact deal negotiated by Scott’s staff because it was too favorable to the Seminole Tribe. Details of the failed deal, obtained by the Herald/Times, show a blueprint of what a future compact may offer the state and tribe.

Among the provisions: Craps and roulette would be offered at all casinos in exchange for $2billion over seven years; one resort casino would be allowed in Miami-Dade, but some payments from the tribe would end; a Seminole tribe casino could be opened in Fort Pierce; and there would be no penalties to the state for lowering the tax rate to parimutuels or allowing de-coupling for dog racing.

Brian Ballard, a Tallahassee lobbyist whose clients include Palm Beach Kennel Club and Resorts World Miami, the Genting affiliate that wants to bring a resort casino to South Florida, said he believes that legislative resistance to updating Florida’s gambling laws is diminishing and Scott seems open-minded.

“I really feel good about where the governor is,” said Ballard, who heavily backed Scott’s reelection bid. “The smart money is always going to vote against gaming bill but, if there’s a compact, there will be more people taken care of in it than there has been.”

Mary Ellen Klas can be reached at meklas@MiamiHerald.com and @MaryEllenKlas