Casino gambling measures are dead in two southern states after legislative maneuvers failed to produce votes last week.
On February 26, Georgia House Speaker David Ralston postponed House Resolution 807, which would have allowed up to four casinos in the state, including two in Atlanta, and House Bill 677, which would have increased the casino tax percentage compared with earlier proposals and directed at least 90 percent of casino revenue to the HOPE Scholarship program. Ralston made the move on Crossover Day, February 29, which was the 30th day of the 40-day session, after which no general House bill can pass to the Senate.
Ralston’s actions came as a surprise considering on February 25, the Regulated Industries Committee overwhelming approved HR 807, sponsored by state Rep. Ron Stephens. But, in postponing the vote on the resolution and the measure, Ralston told lawmakers, “I asked each of you to go home and talk to your neighbors, friends and people you go to church with. And I have found that the people I have talked with care deeply about the character and image of our state and the faith community felt they had not been heard. I want them to know they have been heard.”
Gambling opponent Governor Nathan Deal said he did not believe casinos would “enhance the climate of the state” and stated his concern that casinos could take customers from the Georgia Lottery which funds the HOPE scholarship program. The struggling scholarship program has been underfunded in recent years. Other opponents said casinos would lead to an increase in crime and bankruptcy in the state.
Those supporting the legislation said it would have generated up to $250 million in tax revenue and create 10,000 direct jobs.
HR 807 would have been included on the November ballot to let voters decide whether to amend the state constitution to allow casinos.
permit the development of up to four casinos in the state. The state’s share of casino revenue would have gone to the HOPE education scholarship program.
The proposal would have allowed two casinos in the metro Georgia area, one with a minimum investment of $1.25 billion and a secondary venue with a $750 million minimum investment. MGM Resorts and Las Vegas Sands had expressed interest in an Atlanta-area casino.
Earlier in the session, Senate Democrats doomed a proposed constitutional amendment to allow bets on horse racing. The measure had received approval at the committee level. A separate bill would have allowed daily fantasy sports betting in Georgia.
In Florida, the Senate and House were miles apart on gambling legislation this session, which ends Friday, March 11, and the state’s gambling landscape most likely will remain the same for the time being, although litigation could change the scene. When the House failed to consider the bill on Friday, it died for this session.
The Senate Appropriations Committee tabled SB 7074 which would have ratified the proposed Seminole compact, and SB 7072 which would have allowed slot machines in five counties where voters have approved them. Committee Chairman, state Senator Tom Lee said the bills probably are dead for the session, unless the bill sponsor, state Senator Robert Bradley, decides to bring them up. “Nothing’s dead until the handkerchief drops but I would be very, very surprised if we saw any action on this issue this session,” Bradley said.
The Seminole compact signed by Governor Rick Scott and tribal Chairman James Billie is a 20-year agreement under which the tribe could exclusively offer craps and roulette in Florida, and slots and blackjack outside Miami-Dade, Broward and Palm Beach, in return for $3 billion over seven years. It could not become law without being ratified by the legislature.
Meanwhile, under the 2010 compact, the tribe continues to have the exclusive right to slot machines outside of Miami-Dade and Broward County in return for monthly payments to the state of $100 million. A provision authorizing the tribe exclusivity to operate blackjack at its South Florida casinos has expired, but the tribe has continued to make monthly payments to the state as part of revenue sharing from the card games. The state is holding on to that money until the compact is renewed, or the legislature approves a new one.
Governor Rick Scott warned that the Seminoles were on the verge of laying off nearly 4,000 employees if the compact fails.
“My responsibility was to work to get a compact done,” he said. “My team put together a very good compact for the citizens of our state. It’s up to the legislature to make their decision on what they want to do.”
“According to the Seminoles, if the compact is not passed, 3,700 people are going to lose their jobs,” Scott said. “The legislature has the opportunity to make that decision. We still have time left in the legislative session,” which ends next Friday.
The day before the Senate stalled the bills , in a 12-5 vote the House Finance and Tax Committee passed an amendment to its gaming bill that also would have expanded slot machines to dog and horse tracks in Palm Beach, Brevard, Gadsden, Lee and Washington counties, where voters have approved them, without allowing any accommodations in the compact. The compact as it was negotiated only would allow slots at the Palm Beach Kennel Club in Palm Beach County and at a new Miami-Dade County facility.
Regarding the proposed House committee version, Seminole attorney Barry Richard said, “The tribe would not agree to this. You’re asking for $3 billion. They’re not going to give the state $3 billion and have more gaming around the state than they have now. It’s not going to happen.” Richard added under federal law tribes must have exclusivity regarding some aspect of gambling in order to justify state revenue-sharing agreements. Therefore, the House amendment, he said, is “not workable and the Department of Interior would never approve it.”
However, to sweeten the deal for the Seminoles, the House measure also prohibited slot machines at any parimutuel facility within 100 miles of the Seminole Hard Rock Hotel & Casino in Tampa. As a result, Tampa Bay Downs could not have added slots as it wanted. House Regulatory Affairs
Chairman Jose Felix Diaz noted, “One of the things we know is that the Department of Interior is going to require some concessions. The Tampa facility is the biggest and most important facility for the tribe in Florida.” Diaz, who negotiated the compact with the tribe and Scott’s office, said the provision would offer the Seminoles “the feeling that they are being protected, that they do have exclusivity within their region.”
But House Finance and Tax Committee Chairman Matt Gaetz said the “elegance” of the legislation was that none of the provisions of the bill would take effect without the tribe’s approval. “Nobody gets anything if there is not mutual accord and consent and agreement. I imagine that you would very likely see a negotiation between the tribe and the parimutuel facilities that benefit under the bill. And, if there is an inequity that inequity can be cured by contract.”
The House measure also would decouple all greyhound and some horse racing from other gambling operations, like slots and card rooms. The Senate measure would decouple all horse and dog racing plus jai alai. If passed, the bills most likely would have led to the closing of all or most of the state’s greyhound tracks. Hialeah Park, which runs a Quarter Horse meet, and the harness track Pompano Park also would have been likely to drop their live racing programs.
Throughout the session, senators have expressed a willingness to push back on the tribe’s gambling monopoly in exchange for provisions to help the declining parimutuel industry, including 39 horse and dog tracks and jai alai frontons.
The House legislation also would have lowered the current slots tax rate from 35 percent to 30 percent, and offered casinos the option of lowering the rate to 25 percent for reducing the number of slot machines from 2,000 to 1,700. Both the House and Senate proposals also would have required the compact to recognize fantasy sports; currently that’s considered illegal gambling in Florida. The previous compact would have allowed the Seminole tribe to operate Internet gaming, including fantasy sports, if the state were to authorize the games without their permission.
The House package, which was intended to bring the two chambers’ gambling measures closer together, also would have put a constitutional amendment on the November ballot requiring all future gaming expansion to go before voters. Analysts said that provision was the proverbial straw for Senate leaders. “If you add too many ornaments to a tree the ornaments become so heavy the tree falls over,” said Bradley of the House committee’s unexpected 122-page gambling proposal.
Gambling lobbyists expressed anger at Senate leaders for killing the bill. Palm Beach Kennel Club lobbyist Brian Ballard said, “There are many folks in leadership in the Senate who never wanted a gaming bill and were probably surprised that the House had taken such meaningful action so the only way to stop it is to have it not available for the Senate floor.”
The revised plan would have required Scott to renegotiate the compact and would likely result in a lower guarantee of revenues than the $3 billion the tribe has already authorized.
Now that legislators did not ratify the Seminole compact, the state will feel the impact of two pending lawsuits and could risk losing the annual $150 million in revenue sharing from the tribe’s blackjack and other banked card games. The tribe sued the state last year alleging state regulators breached the guarantee of exclusivity to the tribe when they allowed banked card games to be offered at parimutuel card rooms. In another lawsuit with statewide reverberations, the Florida Supreme Court will rule on whether a racetrack in Gretna in Gadsden County can add slots without legislative approval. Bradley commented, “The disappointing thing for me is that these decisions regarding gaming should be made here, in the legislature amongst elected officials, not in a courtroom, not in an administrative hearing.” Looking for a silver lining, Bradley noted, “If this is taken up in the future then I think we have provided a framework for the next legislature.”
