The break-up: Seminole Tribe stops paying state cut of casino money

A lawyer for the Seminole Tribe of Florida confirmed Tuesday that the Tribe will cease paying the state millions each month from its casino gambling revenue.

The move, which outside counsel Barry Richard hinted at months ago, was reported earlier in the day by the Tallahassee Democrat.

The Tribe recently has paid $19.5 million monthly, with occasional balloon — or “true-up” — payments; it kicked in a total of nearly $320.7 million in the last 2017-18 fiscal year, according to state records. To date, the arrangement has been worth over $2.3 billion to state coffers.

The decision to stop paying also happened to come one day after Marcellus Osceola Jr. was re-elected chairman of the Tribe.

A letter was sent to Gov. Ron DeSantis informing him of the Tribe’s decision, Richard told Florida Politics. A request for comment is pending with state officials; a copy of the letter is at bottom.

At issue was a promise by the state, as a result of a now three-year-old lawsuit over blackjack, that regulators would “aggressively enforce” the Tribe’s exclusive rights to offer the popular card game in Florida.

That enforcement “absolutely did not occur,” Richard said. “Actually the state stopped all enforcement efforts. And as you know, the Session ended without the Legislature doing anything … There was a negotiation that resulted in some agreement in principle between the Tribe (and the Senate) but nothing was completed.”

As it has in recent years, an effort to pass an omnibus gambling bill failed this year. A deal worked by the Senate and led by Trilby Republican and future Senate President Wilton Simpson would have included a renewed revenue-sharing agreement with the Seminoles, among other provisions.

Earlier this year, Richard had said his client would “re-evaluate” whether to continue good faith payments by the end of the 2019 Legislative Session.

The discord officially began with the lawsuit, stemming from what the Tribe called a breach of a 2010 agreement — formally known as the Seminole Compact — that guarantees it exclusivity to offer certain games, particularly blackjack. (Exclusivity essentially means freedom from competition.)

Though the Tribe and the state settled that lawsuit on appeal, allowing them to offer the game till 2030, the Tribe’s continued payments to the state were contingent on gambling regulators promising “aggressive enforcement” against games that threaten their exclusivity.

In fact, the sides had been in a “forbearance period” that ended last March 31, after which the Tribe was entitled to stop paying then.

In 2016, a federal judge ruled the Seminoles could continue to offer blackjack at its Hard Rock casinos, despite the expiration of a 5-year blackjack provision in the overarching gambling deal with the state.

Senior U.S. District Judge Robert Hinkle said the state had broken the blackjack exclusivity promise, allowing it to keep its blackjack tables until 2030, the end of the larger compact.

That was, in part, because state gambling regulators had OK’d certain kinds of  “designated-player games,” similar to poker, that played too much like — if not identically to — blackjack.

Moreover, the Tribe has continued to go after other games it believes violate its exclusivity, including civil lawsuits against slot-machine style pre-reveal games and “electronic gambling parlors” in the Jacksonville area. (The Tribe also has exclusive rights to slot machines outside South Florida.)

What happens next is “the state’s call,” Richard said.

“But if the state stops the infringement, then the Tribe is obligated to resume payments,” he added.