New Gaming Deal May Expand Gambling In Florida. But First, It Heads To Federal Officials For Approval.
Welcome to florida matters. I'm bradley george. Gambling is big business for the seminal tribe of florida. And it's about to get bigger last week state. Lawmakers approved a new compact with a tribe. The thirty year deal with let the seminoles run sports. Betting operations across the state and in the tribe would pay florida. Five hundred million dollars a year in gaming revenue. You'll still needs approval from federal officials and legal challenges are likely on today's show. We look at the future and the past of indian gaming in florida. Darah cam is a reporter with the new service of florida and cupboard. Last week's vote on the gaming compact in tallahassee. We spoke via zoom. Just give me a quick overview of what's What's in this gambling deal that the legislature approved last week. It was a two and a half billion dollar minimum agreement. The seminal tribal chairman marcellus osceola junior and governor rhonda santa's without agreement on april twenty third and it allows for a major expansion of gambling in florida on a number of levels including what people are probably most interested in. It opens the door to sports betting and they auspices of the tribe and we can talk a little bit more about how that will operate. We'll we'll get into that in a minute. But i i know there had been talk for a while of of the state and the tribe trying to come to some kind of new deal. What happened in the last couple of months that brought the two sides together to the agreement. Well i think one thing was the the. The governor really wanted to emerge successful on this deal with politically for him. It's a major achievement that other legislative leaders and his predecessor governor. rick scott was unable to attain. The tribe had stopped paying the state. They were paying annual payments of about three hundred and fifty million dollars as part of an old what agreement. Let's known in federal laws as compact and they had stopped paying that in twenty nineteen because of the designated player card games that are being offered at para mutual card rooms throughout the day. And the say so the state has been missing out on three hundred fifteen million dollars a year that the tribe had agreed to for revenue sharing a from proceeds from their blackjack and slot machines operations at most of their casinos. So the governor really. I think he wanted to do a deal. That helps the pira. Mutual operators pair mutuals horse tracks highlight franz dog tracks. Now are not racing any longer but they have been in florida for over one hundred years and at one point they were people came from all over the country to to campbell at these facilities and they were pretty ritzy glamorous establishments that's changed over recent years but the governor saw an opportunity to get a deal with the tribe the lucrative deal with the tribe. It's a minimum of five hundred million dollars a year over the first five years. This the money was a really good deal at a time when the state might be looking at declines in general revenue funds and something that would give new products to the existing para mutuals and allow them to continue to operate in a world where they've seen their numbers just declining pretty dramatically. So let's look at what's in this deal. And and sort of the biggest aspect in terms of the expansion of gambling in florida is allowing the seminole tribe essentially a monopoly to run sports betting in the state. What what will that look like once. It takes effect so this sports betting provision allows the tribe to essentially to serve as what they called the hub for sports betting and they computer servers that generate these mobile bet. So you'll be you'll be able to pull up an app or what they call a skin on your phone and place a bet anywhere in florida they will serve as the host and they will contract with at least three para mutual operators who will be to also offer sports betting again the tribe will serve as the host and the pair mutuals will get sixty percent of the split on that and a portion of the proceeds from the sports. Betting will go to the state in terms of taxes depending on where the where the bed is made the problem as you now and everyone is aware of at this. Point is whether that sports betting conducted off of tribal lands whether that is permitted under federal law and whether that it requires a statewide vote under a constitutional amendment florida voters approved twenty teen that requires statewide approval of expansions of gambling. What about the seminal Rock hotels and casinos the one here in tampa in south florida. How will things change their under this agreement match and like an. I don't know you know what you and your listeners are familiar with. But i would imagine that at their facilities in tampa and hollywood that the tribe would have some sort of a sportsbook room or facility where people can come in. They'll be a bunch of you know tv screens and they can watch games. And they can bet on them while they're at the facility. A lot of money is wagered on sports betting but the profit share the revenue to the operators is not that great. So they're going to make what i've heard. The rule of thumb is is that people make about five percent off of what's being wagered so the amount while the numbers are very high they can be in the billions of dollars wagered on sportsbook the actual amount of money that people draw down from that did operators or computer platforms. Draw down from that is is not that. Tremendous what it does do though. It does a couple of things one is if brings people to the facility so that they're spending money on cars blackjack or slots or food or drink or something like that. So that's something you can imagine. Maybe parties of people will go birthday parties or things like that be question becomes because of the legal issues. Would this agreement leave the tribe possibly as the monopoly for having online sports betting on their tribal properties only and then people would under those circumstances depending on what happens in the federal courts state courts and with the department of interior that has to approve the compact with really truly give the tribe a monopoly in terms of sports wagering conducted on tribal lands. So governor desanta negotiated this deal with the seminal try brought it to the legislature. Lawmakers had a special session. That was three days long where they pass this thing. It a major deal at thirty year agreement sealed through the legislature in three days. Do you get a sense from your reporting and talking to lawmakers if they understood what they were voting on that begs the question do lawmakers there there are many many situations where lawmakers vote on bills voluminous bills and their unacquainted with all of the elements of the bill. This this bill did change significantly because there was a provision the had provision in it that required the state to to negotiate with the tribe within three years for online gaming basically online roulette online blackjack line slot machines and that was a bridge too far for many house members and so they quickly amended that on monday they met for three days they they would probably not had the votes to pass it or may not have had the votes to pass it unless they took that provision out so did they understand all the complexities of what is seventy. Five page. agreement does for the tribe. Probably they understood from thirty thousand foot perspective. Did they have a lot of questions about whether those issues that i laid out for you. Just now on federal court Federal law state corden amendment three. Yes they still. They passed it even while some of the leaders said they don't think that it will that the sports betting provision will hold up so. Why did they do that. We'll governor to santa's he still holds the budget governor de- santa's made phone calls directly to legislators over the weekend leading up to the special session on gaming directly and his stat. Hannes staff reached out to legislators obviously wasn't privy to those conversations directly but one can imagine that your budget shoes or your future legislation could be in jeopardy if you don't support something that the governor has come out publicly signed this with the tribal leader and they as you've seen on many many other issues. The legislature is in thrall enthralled by governor disentis than he says jump and they say how high will you saw some lawmakers as well saying you know. I don't think this is a great deal. But it brings in revenue in. Florida doesn't have many sources for revenues as we don't have an income tax So if we don't approve this agreement we're leaving money on the table. So that's that's why we're going to support it. That's true and i think. The governor believes that this provides some stability for the pair mutual industry for the pair mutual operators and it does bring in some guaranteed revenue for this day other lawmakers have objected. Not only that. It wasn't enough revenue but that it's a really long deal that thirty years in an arena. Where you're talking about technology. The technology changes very rapidly. And so thirty years is quite a long deal to say to set up these parameters in these boundaries. And this is what gambling is going to look like and it can't change unless there are some pretty high bars such as legislative action or constitutional amendments. What benefits will the tribe. See out of this deal. What what are the the the the tangible impacts in terms of the tribes finances from From this agreement will the tribe. Obviously they get to add craps and roulette. They get the certainty of knowing that there will be no competitor's within a certain mileage range of their tampa operation and within fifteen miles in a straight line of the hollywood operation they also are allowed to add three casinos to their hollywood operation. Having a compact with the state does help them financially. It helps their investors their global enterprise. So it does provide some stability for investors as they expand in other countries and other states that was derek a reporter with the new service of florida. This is florida matters are show continues in just a moment. You're listening to florida matters. Wsf eighty nine point seven. I'm bradley george. The seminoles were among the first tribes to get into the gaming business. It all started in nineteen eighty with a bingo hall and broward county. Ucla professor jessica catalino has studied the tribes history with gaming and wrote about it in a book high stakes florida's seminole gaming and sovereignty. How was it that the symmetry particular got into this world of gaming. Because as i understand it they they were really the first native american tribe to get into this enterprise in on a on a pretty large level. One of the common misunderstandings about gaming is set at something that the federal government decided on and then sort of granted to the tribes looking at the seminole tribe shows that. It's actually the opposite. They pursued tribal gaming on their own of their own volition under their own understandings of their sovereignty and then the federal government and the states had to kind of deal with it and figure out what to make of it. It's important to put gaming in the longer. History of the way that the seminole tribe and other indigenous nations have tried to keep the economy's going so gaming isn't the first thing they tried before that there are things like commercial cigarette sales Before that cattle ranching there's a whole ways range of ways that indian tribes have attempted to bring in revenues to support their government and their people It happens that gaming and other highly taxed and regulated industries are ones where they can see a bigger profit margin. So with a seminal tribe. It started with this one bingo hall in broward county and today we have these hard rock hotels in south. Florida here in tampa. How do we get from that bingo hall to where it's this huge multibillion dollar operation with a brand name like like hard rock attached to it was quite a journey so the seminole tribe as soon as they open that little casino in hollywood florida. They got sued by the state. The state of florida said This doesn't fit our regulations around gaming. You can't do this. seminal tribe. Went into court and unfought this up into the federal court system and ultimately won and prevailed in ways that allowed other tribes to then start doing this as well so they had to fight this in the courts. The also had to kind of fight this in the court of public opinion Whether people supported them doing this which affected the the legislators in florida and whatnot so they had to kind of express why they were doing it and what it meant to them they did. Things like contribute philanthropic -ly to local organizations to show that they were good neighbor for example and time passes and they began to expand of the unique things about the seminole tribe. Is they have reservations across. South florida distributed geographically including urban places. No casino gaming tribe can make money doing this. It depends a lot on your geography so the the big cypress brighton. Reservations aren't the moneymakers right. It's the ones in hollywood and tampa where there's a big population and both tourist and residential so its geography its law. It's business savvy. There's debates and negotiations with the state of florida that's a whole nother story on. There's a history of these compacts and then eventually they contract with hardrock to build these two big facilities one in hollywood and one in tampa That changed the game. A for gambling in saas in florida and a lot more revenues in the around two thousand seven eight the seminole tribe finds out that hard rock international is actually going to be sold and puts an silent bit and silent auction bid for iraq there to facilities. Were making so much money. And they were paying. In hollywood and tampa and the seminole tribe was paying so much to hardrock licenses to use their name and have hard rock franchises that they had a comparative advantage and bidding to actually by hard rock much to the surprise of almost everyone because his negotiations were very quiet The seminole tribe is hard rock international And it's the largest purchase of a multinational corporation by indigenous nation anywhere ever in the world and shocks the business reporters and everybody else so we go from a little tiny casino to the seminole tribe owning hard rock international. Not only their own casinos in tampa and hollywood but hard rock cafes and a resorts around the world And that all happens in thirty years and that's pretty fast. How does the revenue that's been generated from these casinos. How has that changed. Life for the seminole tribe casino gaming has brought a single generation transformation from pervasive economic struggle to overall economic security and comfort. That's a huge political and social and cultural experiment. That the seminal tribe embarked upon. What does it mean to take. People not just a family like if someone a lottery or an individual but whole community information and in one generation go from Real economic struggle pervasive economic struggle to a new way of living. This has affected people at the individual level and at the collective level so one of the important things to know about. Indigenous gaming is that indian casinos are not owned by an individual. They're owned by a tribal nation so their governmental operations when revenue comes in too when someone goes in plays blackjack at the hollywood or tampa casino that revenue goes into the coffers of the seminole tribe of florida at the tribal council and it gets budgeted through irregular budgeting process. Like any other government would do so. It's not just like it. Goes into someone's pockets as an individual or a politician or anything it goes into the tribal coffers goes through budgetary process and gets allocated backout Seminal has balanced an approach that redistributes those funds to individual citizens of the seminole tribe. So that people can have economic security in their own lives on the one hand and on the other hand going into tribal endeavors things like economic diversification things that cultural programmes like expanding social services. One of the most consequential effects of casino gaming for the seminole tribe and many other tribes as well is that They were able to take back their own social services and shape them in their own image so they have their own health clinics. They have their own emergency response. Services their own schools All the kind of big questions people are asking in this country and around the world about what should government do and What's adjust way to take care of people. Those have been things. The seminole tribe have been actively and creatively engaging for ever since casino gaming started changing the revenues. That were coming into the tribe. Casinos have really changed The possible ways of living for not just individuals but for the tribe as government and that piece of it is really important and too often overlooked when people just focus on the dollar signs. How has the relationship you talked about this a little bit early. On when when when seminal try i got into gaming. How is the relationship between tribal government and the state government in tallahassee evolved. And how does the relationship here compared to the relationships between tribal governments and other state governments elsewhere when the seminole tribe started gaming The first approach of the state of florida was to try to shut it down and there wasn't ever serial relationships there for some the seminole tribe of florida. There's a there's some legal technicalities which we can talk about if we want to. That require tribes of if they're operating certain kinds of games to negotiate with the state in which they live. The state of florida for a long time was unwilling to engage in good faith. Negotiations with the seminole tribe of florida and in fact the seminole tribe tried to bring this all the way up to the supreme the supreme court case. Us supreme court case about the failure of the state of florida to negotiate in good faith as required by federal law. Now that also meant that. The seminal tribe during that time didn't have to share their revenues with the state of florida or have anything to do really with the state of florida. They could just regulate their own games and So they were able to build a lot of revenue off of that that began to change over time When the state of florida began in the two thousands to Negotiate more with the seminole tribe leading to these in call compacts and. They're all over the news right now. I know in florida Let me just give a quick bigger picture on. What compacts are they are. Negotiated agreements between sovereigns between indigenous nations as sovereign governments and state governments. One of the underappreciated. But i think really radical effects of indigenous casinos in places like florida. Connecticut other states is that the states and their budgets have begun to depend on the revenues that come from casino gaming tribal gaming The revenues that are shared with the states. So we have this interesting situation in which like the state of connecticut for example would have been operating in the red for many years in their budget. Had they not had the revenues coming in from their compact agreements with the mohegan an mashantucket pequot tribes when we look at these gaming compacts third the a lot of money that's coming to states and so seeing that it's the trouble nations who are some time shoring up. State budgets is a really interesting development in the history of the economic relations between these sovereigns. Seminal started gaming and as many other nations with conviction that they are sovereigns who have the authority to regulate economic activity on the reservations that their governments who get to do this. Us law came along after seminoles and others had opened casinos and began to regulate that and that u. s. law is what required that if if seminals annals operate certain kinds of games or do certain sorts of gaming that they negotiate compacts with the states in which they live. That law was a big compromise that tribes were like. We're doing casinos. We want this revenue the states. This is in the nineteen eighties. The states were like whoa suddenly. We have this competition. Nevada was worried New jersey was worried because they have their own gaming industries so the us government forged a law called the indian gaming regulatory regulatory act. That compromised in the compromise was to support tribal gaming but require that the most lucrative parts of it have to be negotiated with states in which the tribes live Which then allows the state to have some control over it. Some tribes see that as a real compromise of their sovereignty because they're nation to nation sovereign relationship with the united states not with thick states in which they live. That was a long answer to your question but it gets at the complexity of this. I just want close on that point that you talk about state revenues and that was a big part of the debate over this new compact that passed legislature last week. You had lawmakers who said. I don't support what's in this compact. I may not totally understand it. Because i haven't had time to read it but if we don't pass this. This is leading leaving money on the table. And that's important in a state like florida where we have. No income tax in were most of the state. Revenue was based in consumption consumption-based. Taxation comes from tourism so this is another avenue for for revenue to plug those holes in the state budget. And if you don't have it then that's money that you have to find elsewhere that you have to cut elsewhere. The reliance of states on revenues from any gaming is a microcosm of a much. Bigger idea that. I want to leave your listeners with Which is too often. People think of indigenous nations as Sort of just like other people and maybe they depend on government and stuff for their To get by. But what really. Americans don't think about enough is how much the economic wellbeing and wealth of americans across the board has really been built on resources from indigenous nations. Right now the most visible example of that is these gaming. Compacts were states are relying on indian nations for state revenues to keep their states afloat and provide for their citizens. Thank you so much for your expertise. We appreciate it. Thank you for happy. Jessica. catalino is an associate professor of anthropology at ucla. and author of high stakes florida's seminole gaming and sovereignty. That's florida matters for this week. Nor priebus is our producer. I'm bradley george. Thank you for listening and join us again next week.