Chalk up another victory for both Disney and the Seminoles

May 2, 2018 2:43 AM
  • Nick Sortal, CDC Gaming Reports
May 2, 2018 2:43 AM
  • Nick Sortal, CDC Gaming Reports

The titan of Florida tourism and the titan of Florida gambling just notched another victory. The collective muscle of Disney and the Seminole Tribe of Florida again proved too strong for those lobbying for casino expansion in the Sunshine State.

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Florida legislators in recent weeks had floated the idea of a special session to create some kind of a gambling deal that would benefit racetrack casinos possibly bring slots to as many as eight other counties in the state. What The Miami Herald described as “backroom diplomacy” between State Senator Bill Galvano, the incoming Senate president, and State Representative Jose Oliva, the incoming House speaker, ended when legislative leaders determined the endeavor was pointless. The votes just weren’t there.

As in the past, those against casino expansion won. What prevailed was Disney’s long-term fear of destination casinos and the Seminoles’ immediate fear of an end to their dominance of gambling in the state.

Despite almost annual efforts, legislators have been unable to work a deal that brings Florida operators what they want. (In this case, it would be slot machines for racetrack casinos outside of South Florida, blackjack and a tax rate reduction for Miami-Dade and Broward counties – the two counties that already have racinos, and craps and roulette for the Seminoles, who say they need those games to attract international guests to their hotels in Hollywood and Tampa.) And this year was extraordinary, because after the Parkland shootings on February 14, the Florida Legislature’s priorities changed. No way was gambling going to get a lengthy discussion, once all eyes in Tallahassee had shifted to school safety.

But let’s be fair here. There’s a reason Disney is the state’s strongman when it comes to tourism. They’ve been smart operators, their impact on central Florida cannot be overstated, and there aren’t many better brands of any kind. Give them props.

The same goes for the Seminoles. While racetrack casinos in South Florida have performed well below expectation, the Seminoles have always met their guarantee on a $1 billion deal with the state, and, in fact, have exceeded it. So if you’re running a state government, and don’t want to risk having below-expected revenues, the Seminoles are the sure bet. No need to gamble with some untested change that may or may not match what Florida is getting now.

And, yes, I do believe this was the chance for the legislature to act. As you may know, the No Casinos group (backed by, um, Disney and the Seminoles), has pushed the Voter Control of Gaming amendment onto the November ballot. The amendment requires that any gambling expansion be approved by voters across the entire state. Straw polls show the amendment cruising toward a win.

Still, in what may be definite overkill, No Casinos cobbled together another advertising campaign, against the special session. Their catchphrase: “Leave it be Until Amendment 3.” Not bad.

So with that door closing, the timing of another piece of news can be only called curious. Details broke Friday that the Cordish Companies is partnering with Eldorado Resorts, Inc., to build a hotel and an expanded dining-retail-residential complex at the Isle Casino Racing Pompano Park.

That’s especially newsworthy here in South Florida because all eight racetrack casinos have announced some kind of hotel plan since slots first started spinning in 2006. But they all have pointed to the competitive advantage the Seminoles have (a lower tax rate) and their own “onerous” 35 percent slot rate as a limiting factor. (That said, the Isle is the area’s biggest revenue producer, taking in $140 million last year via slots.)

The only credible answer to “why now” is that Cordish and Eldorado, which acquired the Pompano Beach property when it bought 13 Isle of Capri properties in September 2016, are confident of success. “The Cordish Companies is one of the leading developers of high-profile, mixed-use destinations in the country,” Eldorado resorts CEO Gary Carano said via a press release. “This development is an incredible opportunity to complement our existing gaming and racing facilities on the site and will become a vibrant destination for visitors to South Florida.”

Meanwhile, the Constitution Revision Commission has created an amendment to require dog tracks to phase out greyhound racing by 2020. For South Florida racinos with greyhound racing, this might be called forced decoupling, and could be viewed as a gift, though there are bound to be legal challenges of all types. South Florida racinos with pari-mutuels other than dog racing will certainly complain their competitors now have an unfair advantage – no burden of supporting a money-losing endeavor. But at the moment, I don’t think Florida voters care about potential problems of a few racinos. The voters just see dog racing as an antiquated sport, and in this case, elimination means progress. And I suspect that neither Disney nor the Seminoles cares that much, so the bet here is that such an amendment can pass. As a respected source of mine often says, it’s not state legislatures that usually bring about change in the gambling landscape. It’s court rulings and voters.