DEAL: Florida Governor Signs $3 billion Gambling Compact with Seminole Tribe

Florida Governor Rick Scott finally struck a deal with the Seminole Tribe on Monday. The two parties signed a 20-year contract that replaced the previous one that expired earlier this year on July 31. This long-awaited announcement about the contract came after many negotiations between the state of Florida and the gambling company.

Terms of this new compact allow Seminole Tribe Florida to offer blackjack exclusively and to add craps and roulette at its 7 gambling venues across Florida. In exchange, the state of Florida would receive about $3 billion within the first 7 years.

”Largest revenue share guarantee in history”

Some people would say this was an end to months of negotiation, though, it is just the beginning of what could become an arduous journey.

The agreement, which Gov. Rick Scott called the ”largest revenue share guarantee in history”, was released Monday night.

The gambling compact also allows Florida state to discuss the possibility of additional slot parlors at existing businesses in Miami-Dade and Palm Beach counties. Moreover, the new terms will offer South Florida casinos the chance to request votes on rights to feature blackjack tables.

The Senate and the House are involved

Governor Rick Scott sent a letter to Steve Crisafulli (White House Speaker) and Andy Gardiner (Senate President) that the extra revenue of USD 3 billion and the many gambling options featured by the companies can well be used to put the foundations of a ”predictable and very stable gambling environment” within Florida’s borders.

Signed by Governor Scott, the agreement will have the support of the Senate and the House. The officials seem to have expressed huge optimism about an eventual success of the 20-year contract.

The deal comes with an essential measure as well, one related to the additional licenses for the gaming facilities in Palm Beach and Miami-Dade counties. Pari-mutuel businesses in the state of Florida are involved. Legislators will debate whether card games such as blackjack should be added to other venues (pari-mutuel) in Miami-Dade and Broward counties. If those counties will start offering blackjack, the state of Florida would lose all card game revenue from the Seminole Tribe.

The measure does not stop a potential expansion of gambling companies in South Florida. A few months ago, Malaysian gambling company Genting Group showed interest in developing a full-scale casino in South Florida.

Exclusive rights and huge payments to the state of Florida

The 20-year agreement states, that Seminole Tribe would operate card games at 7 of its casinos. The expired 5-year deal saw only 6 of the tribe’s casinos operating like this.

Seminole Tribe paid $100 million anually to the state of Florida over the last five years, buying the exclusive right to operate card games, blackjack being on top. The 20-year agreement still grants the tribe the exclusive right to offer table games, yet there is a limit on the number of gaming options that can be offered at its 7 gambling venues.

Tribal officials said they would limit the number of table games and banked card games to 300 and the number of slot machines to 3,000 at each of the casinos. But that’s not all, the Seminole Tribe will pay at least $315 million per year in the first 7 years of the contract. From the 8th year, the gambling company will have to pay at least $500 million in revenue to the state of Florida.

Governor said in the same letter from Monday that the company is very likely to spend $1.9 billion in capital investment. In addition to this, about 5,000 new casino jobs would be created in the next years.

Legislation issues

The new gambing compact signed by the state of Florida and Seminole Tibes must now be approved by the US Interior Secretary Sally Jewell and by Florida Legislature. Since an election year is coming next, and many gambling interets are in the backyard, we could say that this is simply a 20-year lockout of any other company trying to offer gambling play in Florida. The agreement could alter the explosion of expanded gambling. Although Scott and Seminole Tribe agreed to new limits on gambling, this might not be enough.