Gaming deal's approval not set in stone

Gov. Charlie Crist says the gambling compact that he and the Seminole tribe signed Monday is worth $6.8 billion for public education during the next 20 years.

The money won't come unless the compact becomes law, which requires approval from the Legislature. And there's no guarantee its members will approve it, because the terms depart from those that lawmakers laid out during last spring's legislative session and last month's final negotiations.

"I think that we've gotten them as close as we can to the parameters that they set out," Gov. Charlie Crist said last week. "I know the children of Florida deserve the money. I know our teachers do. So I hope they ratify it."

But lawmakers may have a tough time swallowing terms that could harm nontribal racetracks and other gambling businesses in some parts of the state, including the Bay area. Already, some parimutuels are leaning hard on lawmakers to reject the deal.

"Much of what we passed during the session was to maintain the competitive ability of our historic parimutuel facilities that pay taxes to the state," said Rep. Bill Galvano, R-Bradenton, lead House negotiator on the compact. "We wanted to create some fairness and balance."

Wary of 'social costs'

Other critics - particularly in the House - object to what Rep. Jim Frishe described as "a substantial expansion of gambling" throughout the state at Seminole casinos.

"I know it's a source of revenue; however, I'm not a believer in that's how we should finance the state," said Frishe, R-St. Petersburg. "From a practical standpoint, we don't have any way of predicting the social costs that expansion of gambling in our culture would have. The New Jersey experience is, apparently, a warning; you can have a lot of social costs that don't show up for years."

Here are the major trouble spots that could sink the deal in the Legislature:

•Gambling expansion: Lawmakers decided last spring to allow the Seminoles to offer banked card games such as blackjack only at their three casinos in Broward County and one in Hillsborough.

The Seminoles wanted more and they got it. The new compact permits banked card games at all seven of their casinos. Lawmakers signaled reluctantly last month that they could accept games at the tribe's Immokalee facility, but not at Brighton and Big Cypress.

•Exclusivity: The Seminoles don't just get to offer Vegas-style games, under the new compact - they have a near-monopoly on them. The terms would allow the tribe to stop paying the state a portion of its profits if gaming expands at parimutuels outside of South Florida.

The rules are more relaxed for Miami-Dade and Broward counties, because voters have approved Class III slots there. The compact would allow blackjack and other banked card games to expand there.

The compact does provide some perks to all of the state's parimutuels, such as expanded card room hours and the repeal of betting limits on high-stakes poker. But such allowances may not satisfy lawmakers, who had voted last spring to leave open some limited options for expanded gaming. Last month, negotiators for the Legislature were proposing to give the tribe exclusive gaming rights only within a 100-mile radius of their casinos.

To ratify the compact, lawmakers will have to vote in a special session, which either Gov. Charlie Crist or the top officers of the Legislature can initiate. Normally, the governor and presiding officers rely heavily on one another's input in making that decision to avoid sessions that lead nowhere.

What's next?

If the compact becomes law: Florida will start collecting payments from the Seminoles - a minimum of $150 million annually - and gain immediate access to about $160 million the tribe has paid into escrow.

The tribe has been making those payments based on a compact Crist negotiated with the tribe in late 2007. Though the state Supreme Court voided that compact in summer 2008, the tribe has been offering games and making payments based on its terms. Florida cannot touch the money unless a new agreement is in place.

If the compact doesn't become law: The tribe will most likely continue offering games and making payments into escrow until a new deal emerges.

That could involve the federal government, because tribal gaming falls under the jurisdiction of the U.S. Department of the Interior. Federal law gives the tribe a right to have Vegas-style slots, because those games have been authorized in South Florida.

If the government steps in: The Seminoles would have authorized, Class-III slot machines, but possibly no blackjack and almost certainly no exclusive rights to offer such games. The state would lose its claim on a share of the tribe's gaming profits.

Here's why: Florida cannot tax the Seminoles' gaming profits because the tribe is a sovereign nation. To claim a cut of the proceeds, the state must enter into a compact with the tribe that trades some kind of exclusive gaming rights for payment.

At a time when the state's tax collections can't keep up with its costs, Florida can't let that money get away, said Rep. Joe Gibbons. "If you kill the compact, you're killing the state."

The Hallandale Beach Democrat spoke after a meeting of the joint Legislative Budget Commission last week, at which a top state economist forecast that Florida will come up $2.65 billion short of covering its critical and high-priority needs next fiscal year. Absent a strategy for filling the gap, that shortfall could swell to nearly $5.5 billion in 2011-12.

Pleased with the "great deal" that the compact gives South Florida parimutuels, Gibbons said the state needs to embrace the compact and start marketing gambling more aggressively to tourists.

"We need revenues desperately," he said. "This is an assured new source of revenue that feeds into what we already have going, and that's tourism."