Two Florida Senators, Republican Dennis Jones, chair of the Senate Regulated Industries Committee, and Democrat Maria Sachs, committee vice chair, recently filed legislation to allow Las Vegas-style casino hotels in five select districts throughout the state. The Senate bill will have to be passed by the Senate Regulated Industries Committee, the full legislature and the governor. Also, voters in each of the five selected districts—Dade and Broward Counties, Palm Beach County, Jacksonville, Tampa Bay and Panama City-Pensacola--would have to approve the proposed casino. Republican Rep. Erik Fresen filed similar legislation in the House. The legislative session will end on May 6.

 The Seminole Tribe of Florida and the state's parimutuels both have announced they will fight the legislation.

Jones said a bidding process would be used to select the five "destination resorts," and he already has been approached by eight casino operators. Bidders would be required to pay a $50 million non-refundable licensing fee and a $1 million non-refundable application fee; 95 percent of that money would be directed to the state's general fund. The agency that would market the new casino resorts and a state education fund would share the remaining 5 percent. The Destination Resort Gaming Commission, a seven-member board appointed by the governor and approved by the Senate, would be formed to regulate the new casino gambling. 

According to the legislation, the casino resorts must contain at least 500,000 square feet for meetings and conventions and a minimum of 1,000 hotel rooms. No more than 10 percent of their square footage can be allocated for gambling. Jones said an estimated 8-10 million out-of-state tourists would visit the new casinos, and 3.5 million Floridians would not leave the state to gamble.

"This is not a casino bill. It is a destination resort bill," Sachs told Gambling Compliance. "We do not have a large resort outside Orlando that can accommodate conventions. This bill would do that. This may be a hard sell, but I want to win this one and I think our chances are good."

Among the interested parties is Las Vegas Sands Corporation, which could invest $1-$2 billion in a potential casino resort development in Miami. Las Vegas Sands Vice President of Government Affairs Andy Abboud said, "Florida is much further along than a lot of people realize. There is a core group of leadership that is not looking at this as a moral decision but as a business decision. We have had a lot of meetings with folks in the Miami area. The legislation is being introduced to help grow the destination and have a strong convention component."

An economic impact study indicated a Miami casino resort could create more than 100,000 full-time and part-time jobs, including temporary construction jobs, permanent jobs when the property opens and jobs at related new businesses.

Las Vegas Sands lobbyist Nick Iarossi noted his employer as well as Wynn Resorts, Boyd Gaming and other casino operators are not willing "to wage a multi-year fight" for a presence in Florida.

Last month, Las Vegas Sands was subpoenaed by the Securities and Exchange Commission regarding compliance with the Foreign Corrupt Practices Act in connection with a wrongful firing suit brought by a former Macau executive. The Department of Justice also is investigating.

Joel Simkins, a gaming analyst at Credit Suisse, said, "While uncertainty could linger over Las Vegas Sands shares, our contacts noted investors should not jump to any conclusions. Although accusations were made, it does not mean that it will amount to anything material from a punitive or financial perspective."

In an editorial, the online publication, Florida Clarion, noted, "Rarely in Florida history has a piece of legislation been so crafted to benefit a specific special interest as has Senator Dennis Jones’ 'Destination Resort' casino gambling bill. The designation of five 'regions' throughout the state is a move by Las Vegas Sands Chairman Sheldon Adelson, who is looking at several Miami sites, to block the Fontainebleau on Miami Beach and the Diplomat in Hallandale from operating casinos. The requirements—a $50 million licensing fee, a $1 million non-refundable application fee, the commitment of Convention Center space and a 1000 room hotel—would shut out Adelson’s less well-heeled competitors."

The publication further noted that Adelson contributed more than a $2 million to Republican lawmakers working on the bill. 

Currently, gambling in Florida consists of uncapped poker, in which players can buy-in for any amount, and the Florida Lottery, approved in 1986, plus horse tracks, dog tracks and jai-alai frontons that offer poker. Five parimutuels in Broward County and Miami-Dade County offer slot machines, which netted more than $140 million for the state last year. Poker revenue was about $12 million. In addition there are eight Native American-owned casinos in the state, which reported $2 billion in revenue in 2009.

John Lockwood of Gunster Law Firm, which represents several Florida parimutuels, said: "The recently released casino gaming legislation unfortunately ignores the long-standing parimutuel industry which has been a part of Florida's history for many decades, employed generations of Floridians and paid hundreds of millions in tax dollars. The ultimate result of this legislation will be a net loss due to the decimation of the parimutuel industry and lost revenue from the Seminole compact."

The Senate bill would not allow Florida's three thoroughbred tracks or other parimutuels to build casino resorts or share in any of their gaming revenues. Frank Stronach, chairman of MI Developments and Gulfstream Park racetrack has met with Florida legislators regarding the company's interest in developing a casino resort on Gulfstream's 250-acre property.

The Seminole Tribe of Florida, which operates seven casinos on sovereign land, including Seminole Hard Rock Hotel & Casinos in Tampa and Hollywood. The Miccosukee Tribe has a casino in Miami that only offers bingo-based slots and poker.

In 2010, the Seminoles and the state signed a five-year compact that allows blackjack and other table games at certain tribal casinos. The agreement will generate about $1 billion for the state, in exchange for exclusive rights for gaming. The new destination casino resorts would violate that provision, forcing the Seminole Tribe to reduce or stop their payments to the state.

Tribal spokesman Gary Bitner said, "If the legislature wants to allow in new entities, it will have to decide if it's a good tradeoff. Are they going to make enough to make up the assured payments from the tribe?"

Jones pointed out, if his bill becomes law, a destination casino resort would not be operational for four years. "In that case, Florida would gain $500 million from the new destination resort casino and that would be more money that it would lose in tribal payments," he said.

An opponent of the legislation, former Rep. Dick Batchelor, said, "We all know it's about money, but rather than do the right thing and set better priorities, they're going to the vice industry, and I'm a pretty liberal guy. The bottom line is, 'Is it good for Florida?' and I would suggest it's not at all good."

Governor Rick Scott has not publicly commented on expanded gambling since early January when he said he would be open to it. Scott met with Adelson of Las Vegas Sands in November.

Other gambling bills under consideration in Florida would legalize intrastate online poker, create a new parimutuel regulator and allow greyhound tracks to stop racing but offer simulcasts and poker rooms.

By Staff