ORLANDO — A new Seminole compact on gambling was negotiated weeks after the deadline to renegotiate had already passed and lawsuits were filed in federal court. What came out of the negotiations was a wide-ranging deal that touched on nearly every facet of Florida’s gaming industry. But key lawmakers are downplaying expectations for the passage of any compact, calling the job “a heavy lift.”
On Thursday, Senator Bill Galvano, who helped lead negotiations in the original compact, addressed members of the gambling industry at the Florida Gaming Congress, delicately attempting to decipher for them the complicated political realities of approving a new Seminole compact.
The industry is “interconnected” he said, "like a Rubik’s Cube — you can't turn one way without impacting every aspect of the industry.”
He learned from chairing the select committee that handled the original compact, he said, "that you could not move a compact through the process unless you had some form of equity legislation that continued to balance the multiple interests.”
In that statement, Galvano summed up the challenge lawmakers face: to craft a compact that threads the eye of a very small needle, one that gives enough to enough interests without alienating too many of those interests to shore up the votes needed to pass.
Incumbent stakeholders like things the way they are, while some aspiring players are ready to kill the deal if they don't get more. All the while, the tribe will be able to hold out the threat of withdrawing support for the deal if they believe the agreement has been cheapened.
“Every time something moves, whether it be a tax rate, whether it be hours of operation, whether it be a bet limit everybody in the industry looks to see how that will impact them, and tries to calculate that impact and wants to weight in,” Galvano said, citing himself when the original compact was passed to describe just how tough the industry is: “I’ve never dealt with a group that cares more about what the other guy doesn’t get than what they can get — and that was true until I became apportionment chair and had to deal with redistricting.”
And as moneyed interests go, so do lawmakers whose districts house those interests.
"There is a parochialism that each member brings to the process,” Galvano said, noting that many lawmakers have pari-mutuel facilities in communities they serve. “That is why there has to be equity for something to pass.”
"There is a very real possibility that we will not pass a compact this session, because, to do it right you have to bring everybody in,” Galvano explained.
It’s not just balancing thesplintered interests that threatens the compact, but beating the clock. The session starts Tuesday and lawmakers will only have 60 days to thread that needle.
Galvano predicts there will be a workshop on the compact in second week of session, “and then it’s off to the races."
But Galvano also had a message for lawmakers who may want to take a piecemeal approach, as well as those anti-gambling advocates who have decried the compact as a massive expansion of gambling.
“We cannot put our heads in the sand and pretend we’re not a gaming state,” Galvano said. "The reality is we are. … Let’s get past that aspect of it and realize it’s part of the fabric of Florida and then decide what we want the state to look like,” he added, before calling for “a long-term vision and a big-picture plan versus a reactionary plan.”
As for what happens without a new compact, Galvano pointed out that a compact already exists, it just does not include the banked card games like blackjack that the tribe continues to offer at its casinos.
“So we don’t have to have it," he said. "It’s not in the governor’s budget, it has not been contemplated by the House or Senate in their budget, so it’s not something that we have to have.”
However, much is at stake, from the potential $3 billion over seven years should proposed compact be ratified, to the loss of an estimated $85 million between fiscal year 2015-16 and 2016-17 because of an assumed end to payments for banked card games and Broward gaming — though the tribe has said it is continuing to make revenue share payments.
Galvano’s speech was followed soon after by Seminole Gaming CEO Jim Allen, who was a late addition to the event and wasn’t included in the event’s program schedule.
Allen said he was reluctant to speak at first for fear that it would complicate the issue politically and in the press, but that he became concerned by recent reporting.
One publication called it “a sure bet lawmakers won't sign off” on a new compact, and though lawmakers have said that passing a compact that is identical to what was proposed is unlikely, it’s also a Capitol cliche to say nobody has a crystal ball.
"What I wanted to most importantly address is that the Seminole Tribe of Florida is not a proponent of this perception of the huge expansion of gambling in the state,” explaining that the carve outs that would allow for the approval of new slots licenses and limited blackjack, among other provisions, without violating the tribe’s exclusivity.
The lack of certainty about the future, Allen said, led to the list of exceptions to provide political flexibility, "but that doesn’t mean we support those particular exceptions and that doesn’t mean it’s going to occur."
But just as the exclusivity carve-outs create flexibility, they also set the battlefield on which gambling interests will fight.
"The Seminole Compact is not passed unless something good happens for the pari-mutuels," said Alan Koslow, an expert on gambling law and a lobbyist for the pari-mutuel industry, at the event.
Still, Allen is hopeful.
“We negotiated with the House, the Senate and the governor simultaneously. So we think that gives us a great foundation in order to hear the comments … and try to move that forward.”
As for how the tribe will proceed should a new agreement not clear the Legislature, Allen said the tribe would still offer blackjack and stood by the assertion that the state has been in breach of the original compact, and though "it is 100 percent not the tribe’s intention to litigate this,” he noted that a federal judge on Thursday allowed the tribe’s lawsuit against the state to move forward.
However, he said, “We would prefer to reach a resolution, have the compact signed, continue the amazingly positive relationship we’ve had with the State of Florida and move forward for the next 20 years."
Guest Opinion: Expansion of Gambling a Bad Bet for Florida
September 18, 2018
HOT OFF THE PRESSES!!! FLORIDA DECOUPLING FAILS AGAIN