Florida Lawmaker Files Sports Betting Bills, But Legalization Is A Complicated Work In Progress

A Florida lawmaker this week filed a package of sports betting bills ahead of the 2021 session, but like many others in states across the nation, he may have underestimated a powerful player — the Seminole Tribe. It’s a scenario that has played out from California to Oklahoma to Connecticut — legislators are eager to reap the potential financial benefits of legal sports betting, but they collectively don’t seem to comprehend that filing legislation without agreement or input from tribal interests is a road to nowhere.

Sen. Jeff Brandes filed SB 392, 394, and 396, which collectively would legalize statewide mobile sports betting regulated by the Florida Lottery with a 15% tax rate on revenue and a $100,000 application and annual renewal fee. SB 392 allows for sports betting at self-service lottery kiosks, but it does not mention tribal casinos. It also seeks to limit the maximum bet players can wager — a concept that has been shot down by operators in multiple states. In fact, Coloradans voted to allow gaming jurisdictions to lift the betting maximum for all gaming on Nov. 3, and two have already done so.

Whether or not Brandes’ bills move through the state legislature, which convenes for 60 days March 2-April 30, they’ll likely face the same fate as legislation put forward by California lawmakers earlier this year. Rep. Adam Gray and Sen. Bill Dodd tried to fast-track a sports betting referendum bill that would have allowed for statewide mobile sports betting and retail wagering at tribal casinos and horse racetracks. But Dodd withdrew the bill within a month.

Legislative option didn’t work in CA, CT

Dodd’s bill in California sought to bridge a disagreement between the state’s 63 gaming tribes and card rooms. The tribes contend they have exclusivity for sports betting and also for house-banked card games, and they claim the card rooms are encroaching on that with their card-game offerings. (Basically, tribal casinos offer “house-banked” card games, meaning the casino uses a dealer to pay out losses and collect winnings, and card rooms are supposed to offer “player-banked” card games, in which the dealer rotates among players who pay out losses and collect winnings.) The National Indian Gaming Commission concluded in 1995 that any banked card game is Class III gaming, which means it should be under the tribal purview.

There’s a long history of lawsuits, and Dodd’s bill included tribal casinos and horse racetracks as places for brick-and-mortar sports wagering while also calling a truce between the tribes and card rooms, which would not be able to offer sports betting. For the tribes, that wasn’t enough, and the bill was killed.

Oklahoma’s tribes also claim exclusivity to sports betting, and given the federal definition of Class III gaming, Oklahoma’s tribes — and every federally recognized tribe across the country with the words “Class III gaming” in their compacts, for that matter — do have exclusivity. But tribes there say they are in no hurry to legalize, which likely means they are not on the same page as lawmakers, so legislation won’t move forward.

And in Connecticut, lawmakers, commercial interests, and the state’s two tribes have been going at it in public hearings and op-eds for more than two years now. Earlier this year, the tribes threatened to stop their payments to the state should it legalize sports betting for anyone other than them. The Mashantucket Pequot (Foxwoods Casino) and Mohegan (Mohegan Sun Casino) pay the state 25% of slot gross gaming revenue or about $250 million annually.

Tribes will protect citizens; 2018 referendum an issue

So, while Brandes’ bill may be perfectly palatable to operators, it’s not likely to gain any traction. The Seminole Tribe, which owns Hard Rock International, operates six casinos (one is a bingo casino) in Florida and according to its website, 90% of the tribe’s annual budget comes from gaming. Like tribes across the country, the No. 1 priority for the Seminoles when it comes to a gaming expansion — be it sports betting or anything else — will be protecting that revenue and its people.

It is definitely possible that its revenue will grow in a scenario where outside groups become permitted to offer sports betting alongside the tribe, but this calculation is a work in progress. But there is precedent for this type of situation in Michigan, where legal online sports betting and online casinos — offered by both tribal and commercial casinos — are expected to launch online in January.

There are other issues at play, the main one a 2018 referendum passed by voters that calls for gambling expansion to be approved on a local basis. One interpretation of that is that the state cannot unilaterally legalize sports wagering — each city or town or county would have to do it on its own, and that would make it particularly tricky to legalize digital wagering, though it could be done.

There is also precedence for local approval — voters in 56 of 64 Louisiana parishes OK’d sports betting in November, and in 2018, voters in 47 parishes gave the go-ahead to daily fantasy sports. In Louisiana, however, sports betting will be available only at brick-and-mortar facilities.

Maybe Brandes is just trying to light a fire under the Seminoles to get them to the table. Or maybe he believes a legislative option could move forward on its own. Either way, until further notice, live odds on legal sports betting in Florida remain relatively low.

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