Florida Legislature Hands Sports Betting To Seminoles, Permits Non-Thoroughbred Tracks To Decouple From Gaming - Horse Racing News | Paulick Report

Florida Legislature Hands Sports Betting To Seminoles, Permits Non-Thoroughbred Tracks To Decouple From Gaming

Florida Gov. Ron DeSantis

On the final day of a special session, Florida legislators on Wednesday approved three separate gambling measures that will strengthen the Seminole tribe's dominant position in the gambling market, allow non-Thoroughbred pari-mutuel facilities to decouple casinos and card rooms from their racing and jai-alai operations, and create a five-member Gaming Commission that will replace the state's Division of Pari-Mutuel Wagering.

The net result will mean more competition for the state's two remaining Thoroughbred tracks, Tampa Bay Downs in Oldsmar and Gulfstream Park in Hallandale Beach. Horsemen fear that will lead to lower purse money for Gulfstream Park and a reduction in racing days, according to Stephen Screnci, president of the Florida Horsemen's Benevolent and Protective Association.

The bill that garnered the most attention is approval of a 30-year compact between Gov. Ron DeSantis and the Seminoles, giving the tribe a monopoly on sports betting and permitting the addition of three new casinos on the site of the existing Hard Rock Hotel & Casino in Hollywood, approximately 10 miles northwest of Gulfstream Park. The state gets $500 million a year from the the deal for the next five years.

The Seminoles will have a monopoly on sports betting, both at the seven Florida casinos they currently operate and via mobile applications. Pari-mutuel facilities may enter into agreements with the Seminoles to offer sports betting and split revenue with the tribe.

That portion of the legislation, along with language that could bring a new casino to Miami-Dade County off tribal land, is likely to be challenged in court by gambling opponents who say the bill violates a 2018 statewide ballot initiative that blocked any further expansion of gambling without voter approval.

The bill to approve the Seminoles compact passed 38-1 in the Senate and 97-17 in the House.

The decoupling bill likely will end live racing at South Florida's Pompano Park, the state's only harness track that opened in 1964 and is now known as Isle Casino Pompano, a Caesars Entertainment property. A last-minute amendment in the Florida House version of the bill to exempt harness racing from the decoupling law was stripped in the final version that passed the Senate by a 39-0 vote and the House in a 73-43 vote.

HarnessLink.com reports that Joe Morris, VP of racing at Pompano, said there will be one more season of racing at Pompano, as Caesars had previously promised. If decoupling had not passed, the company was ready to pair its casino with a dormant jai alai permit it had acquired and end harness racing that way.

Hialeah Park may also have seen its last race. The historic track that once hosted South Florida's best winter Thoroughbred meet has been operating its casino since 2010 in connection with a Quarter Horse permit that began with competitive racing sanctioned by the Florida Quarter Horse Association. Those races were replaced by match races that were run so that Hialeah fulfilled its casino license obligation to conduct races as defined by Florida statute. That will no longer be necessary.

The idea of acquiring licenses for card rooms and simulcasting by running horse races began in Florida's panhandle when an operation in Gadsden County offered pari-mutuel wagering on barrel races. After a court struck down that as not fitting the definition of pari-mutuel races,  lawyers familiar with state regulations came up with the idea of match races – sometimes involving flag drop starts and slow horses walking or trotting down a dirt path. Remarkably, that passed legal muster and Quarter Horse permits sprung up in several other locations around the state, with farcical races giving operators the legal right to open card rooms and simulcast parlors.

Under the bill passed on Wednesday, all those facilities may now end the sham horse races but continue to operate their card rooms and simulcasting. The same is true of the state's jai-alai frontons, which may also be decoupled. Greyhound racing became extinct at the end of 2020 after Florida voters approved a ballot initiative to ban the sport, so those tracks already have decoupled from their card rooms and simulcasting.

Screnci, the HBPA president, said revenue from slots operations to purses – currently about 20% of total purses – will fall. Currently, he said, horsemen receive about $9 million annually from the Calder Casino, but the contract with owner Churchill Downs Inc. (CDI) is set to expire on July 31. CDI previously received state approval to couple its Calder Casino operations with a jai-alai permit it acquired, allowing the company to end live racing at the track that in recent years has been leased to Gulfstream Park's owners and rebranded as Gulfstream Park West. The decoupling bill will allow CDI to stop conducting jai-alai and keep its casino open. Screnci said he has had talks with Bill Carstanjen, CEO of CDI, about the company continuing to contribute to purses, since horsemen were instrumental in Calder getting its casino license.

According to Screnci, the Gulfstream Park slots contribute about $6 million annually to purses, and that could fall as the other casinos in the region (including the former Hollywood greyhound track now known as The Big Easy casino and located just over one mile north) become more profitable.

The tax rate on slot operations run by the Seminoles is 12.5%, Screnci said, with Gulfstream Park paying a 35% tax rate.

Horsemen lobbied in Tallahassee for concessions for Thoroughbred racing, but those talks fell on “deaf ears,” Screnci said.

“We asked for a purse pool, with the decoupled permit holders contributing a portion of their funds now that they won't have to spend anything on racing,” he said. “That didn't get a lot of support. There still could be some appropriations from compact money that goes to the state. That's not dead. This compact doesn't discuss any appropriations of money. We might be able to get in the mix there.”

Screnci said the compact between the tribe and DeSantis permits Miami-Dade and Broward pari-mutuels up to a 5% tax break, but not until 2023.

“It's a bad compact,” he said, adding that even with the addition of new casinos and sports betting the state is only getting an additional $100 million per year compared to the old compact.

His fear is that with Calder no longer an option as a racetrack and purse revenue expected to decline, Gulfstream Park will have to cut racing dates. “We can only go so low (on purses),” he said. “If we lose too many racing days, the lure of year-round racing goes away. That's one way we've managed to keep stables here in October and November, by racing so many days.”

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