Seminole Tribe stops giving the state of Florida gaming revenue

Following another failure in legislative negotiations over its exclusive rights to certain card games, the Seminole Tribe of Florida notified Governor Ron DeSantis that it would no longer be paying millions of dollars every month for gaming exclusivity rights as of Wednesday.

Marcellus Osceola Jr., the chairman of the tribal council, wrote, “The Tribe believes that the compact and related legislation developed with the Senate leadership would have resolved this issue and been mutually beneficial to the State and the Tribe.”

Osceola stated that he agreed with the governor’s choice to review the matters more thoroughly and pick up the conversation in the summer.

“Until the illegal banked card game issue is resolved, the Tribe will adhere to its agreement with the state and suspend its revenue share payments,” Osceola reveal¹

If the state is unable to prevent parimutuels, which include horse and dog tracks and jai alai frontons, from providing card games that the tribe claims violate its exclusive gambling rights, there could be a $350 million loss of revenue. In particular, the tribe is the only ones authorized to hold “banked” card games—a type of gambling where all bets are covered by the house and players wager against it.

Given how erratic the tribe’s situation was, the revenue was excluded from the state’s $91.1 billion budget.

The Governor’s Office stated that although it has not yet received the letter, it should have it by Tuesday at the latest.

To avoid having to play catch-up due to unresolved issues, the tribe and then-Gov. Rick Scott signed an agreement a year ago for the tribe to continue making monthly payments to the state through the end of this session.

Several contentious issues have arisen concerning gambling regulations in Florida, notably the allowance of slot machines in counties where voter referendums have approved them, excluding Miami-Dade and Broward counties, and the state’s supervision of designated player games.

Since March 31, the Seminole Tribe hasn’t been obligated to make payments, although they’ve agreed to resume payments due to their reliance on the state’s economy.

Barry Richard, the tribe’s attorney, clarified that the payment suspension doesn’t relate to renegotiating or extending the contract but stems from parimutuels infringing on the tribe’s exclusive rights to offer banked card games.

Richard emphasized that the state isn’t required to negotiate a new compact but simply needs to cease the infringements. He pointed out that parimutuels are openly flouting the rules by promoting these card games.

This dispute traces back to a 2014 federal case litigated by Richard before U.S. District Judge Robert Hinkle.

As per the compact between the Seminole Tribe and the state, the tribe has sole rights to offer banked card games. Parimutuels are permitted to host non-banked games like poker, where players compete against each other and collect winnings from a shared pot.

However, parimutuels introduced designated player or player-banked games, where each player assumes the role of the dealer and covers all bets for a hand. When it was revealed that individuals from the casino or external companies were present at each table, the tribe filed a lawsuit.

In November 2016, Hinkle ruled that designated player games violated the 2010 agreement granting Seminoles exclusive rights to offer blackjack and other banked games.

Following Hinkle’s ruling, the state agreed not to appeal if the tribe allowed a year for shutting down the parimutuel card games. A forbearance agreement was reached, giving the state until the end of the 2017 session to cease the games.

However, the games continued beyond the 2017 session deadline, prompting the tribe to extend the deadline to the end of a subsequent session, as agreed upon.

Osceola noted that, based on Hinkle’s ruling, the tribe could have ceased revenue share payments years ago. However, they opted to continue payments, expecting the state to take decisive action to shut down the games.

Despite meetings between legislative leaders and tribal officials towards the end of the recent session, no agreement was reached.

Richard stressed that no new agreement or compact is necessary for the tribe to resume payments. He maintained that all that’s required is for the state to take action, which could be initiated by the Department of Professional Regulation, the Attorney General, or any state attorney.

Richard reiterated that payments would resume once infringements cease, emphasizing that the state possesses various options to halt the infringements.