Gov. DeSantis signs new gambling compact with Seminole Tribe of Florida

COMPACT 2021
The House Speaker says Special Session will be the week of May 17th.

The future of sports betting and casino gambling in Florida is now in sight after a blockbuster deal was signed Friday between the Governor and the Seminole Tribe of Florida.

Gov. Ron DeSantis and the Tribe signed a new Seminole Compact. The 75-page document will determine the long-term future of gaming in the state.

“I’m excited to announce the signing of a new compact between the State of Florida and the Seminole Tribe of Florida, which will generate the state $2.5 billion in new revenue over the next five years and $6 billion through 2030,” DeSantis tweeted Friday, announcing the blockbuster deal.

“This historic compact expands economic opportunity, tourism, and recreation, and bolsters the fiscal success of our state in one fell swoop for the benefit of all Floridians and Seminoles alike,” added DeSantis, in a release from his office. “Our agreement establishes the framework to generate billions in new revenue and untold waves of positive economic impact.”

The Tribe also celebrated the new accord.

“The Seminole Tribe of Florida is committed to a mutually beneficial gaming compact with the State of Florida and looks forward to its approval by the Florida Legislature, the Seminole Tribal Council, and the U.S. Department of the Interior,” said Marcellus Osceola Jr., Chairman of the Seminole Tribe of Florida. “The Tribe wants to express our sincere thanks to Gov. DeSantis, Senate President Simpson, House Speaker Sprowls and many others who have worked hard to negotiate a historic agreement that cements our partnership with the state for decades to come.”

Legislative leadership also is on board.

“The historic new thirty-year gaming compact Gov. DeSantis and the Seminole Tribe of Florida executed today restores the State’s relationship with the Tribe, preserves and offers new opportunities for Florida’s legacy pari-mutuel industry, and provides substantial new revenues for the State of Florida,” said Senate President Wilton Simpson. “I’m grateful to Gov. DeSantis for his leadership in finalizing this compact and look forward to our upcoming special session to address legislation related to the implementation of this monumental agreement and to ratify the compact.”

“For years, there has been much ambiguity around the compact with the Seminole Tribe of Florida,” said House Speaker Chris Sprowls. “Today, we thank Gov. Ron DeSantis for bringing that to a conclusion and for giving us the opportunity to address this key issue for our state. Thank you also for the work of Chairman Marcellus Osceola Jr. and the contributions of Senate President Simpson. We look forward to reviewing the compact in an upcoming Special Session.”

The Special Session starts the week of May 17.

Anchoring the deal is an agreement to give the Seminoles exclusive control of sports betting, which the Tribe would be able to offer at its own facilities as well as through pari-mutuels and its platform known as Hard Rock Digital.

The deal is expected to land the state at least $500 million a year in revenue from the Tribe, well over the $350 million or so a year the Seminole Tribe had been paying the state under the old deal, which has fallen into disarray over disagreements on what games could be offered at state pari-mutuel facilities.

The Seminole Tribe’s last payment under that deal hit state coffers in mid-2018.

However, the new deal would put the pari-mutuel disagreements to bed by explicitly allowing those facilities to continue offering their current slate of designated player games without running afoul of the gaming compact. Also, the Tribe would be granted exclusive rights to offer craps and roulette at its own properties.

The compact “recognizes that designated player games do not breach the Tribe’s exclusivity, but it constrains” the card games “to their current footprint” and does not accommodate any significant expansion of the games, he said.

The Tribe would oversee all sports betting in the state, including at pari-mutuel facilities, which would share revenues with the Tribe, reportedly with the better end of a 60%-40% split in revenue. The tribe would pay to the state 10% of pari-mutuel operators’ net winnings and 13.75% of the Tribe’s own sports-betting net revenues.

The Compact also will incentivize the tribe to contract with pari-mutuels to market the games. The Seminoles’ sports betting payments to the state would increase 2% if they do not contract with three pari-mutuel operators within three months after sports betting goes live. The compact would require the Tribe to contract with an unlimited number of “willing and qualified” pari-mutuels, according to a source outside of the Governor’s office who is familiar with the negotiations.

In addition to pari-mutuels, the Seminoles would be able to enter into a deal with one other online gaming platform, such as FanDuel, DraftKings, or Barstool.

By putting the Tribe in control of the new sports betting market, the Governor and legislative leaders believe the state could allow for sports betting without violating a constitution amendment that appeared on the 2018 ballot as Amendment 3 and requires voter approval for any future gaming expansion.

However, the authorization could face legal challenges under the amendment.

As a sovereign tribal nation, the Seminole’s gaming operations are governed under the Indian Gaming Regulatory Act (IGRA), allowing them to circumvent the amendment.

The amendment allows the Legislature to negotiate gaming compacts pursuant to the federal Indian Gaming Regulatory Act “for the conduct of casino gambling on tribal lands.”

Having sports-betting servers on tribal property while people use mobile apps throughout the state would violate the amendment, said John Sowinski, who was the campaign manager of the political committee behind Amendment 3.

“I don’t think it even passes the sniff test. The file server being on tribal land does not make the gambling on tribal land. If you accept that premise, then the Tribe could operate casinos all over the state as long as the random-number generators in the slot machines were on tribal lands,” he said Thursday, ahead of the signing.

Tallahassee lawyer George Levesque, who served as the Florida House’s general counsel during negotiations with the tribe over the 2010 compact, called the sports betting approach “a creative solution to address the Amendment 3 conundrum.”

“Now, whether that’s constitutional or not, I wouldn’t hazard to guess,” he said. “I would say that everything is constitutional until the court says it’s not.”

Under the proposed deal, the Tribe would not object to real estate mogul Jeffrey Soffer transferring his casino permit to the Fontainebleau Hotel on Miami Beach. On its own, an agreement with the Tribe would not allow Soffer to forge ahead with the transfer — it would require legislative approval.

But, because the old permit would be transferred, rather than a new one issued, the move would also avoid any entanglements with the constitutional amendment.

The compact also addresses whether pari-mutuel operators can relocate, an issue known as “portability.”

The agreement would allow pari-mutuel permits to be transferred but would require the Tribe’s permission if a permit is transferred within 100 miles of the Seminole Hard Rock Hotel & Casino in Tampa, one of the nation’s most lucrative gambling operations. The Seminoles also would need to sign off on permits transferred to Broward or Miami-Dade counties within 15 miles of their Hollywood casino.

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The News Service of Florida contributed to this post. Republished with permission.

Staff Reports


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