TALLAHASSEE, Fla. – A new rule floated by Florida gambling regulators holds a price tag of $50 million a year and could cost hundreds of jobs, according to a lawyer representing several of the state’s cardroom operators.
The regulation in question, proposed late last month by the Division of Pari-Mutuel Wagering, would make a number of changes and effectively do away with controversial “designated player” card games that have been lucrative for pari-mutuel facilities across the state.
The games have played a central role in a legal dispute between the Seminole Tribe and the state, and the proposed rule followed a revamped agreement inked last month by Gov. Rick Scott and the tribe. That agreement is an outgrowth of a 2010 deal in which the tribe promised to pay the state at least $1 billion over five years in exchange for exclusive rights to offer “banked” card games, such as blackjack, at most of its Florida casinos.
During the legal dispute, Seminole lawyers argued that the way designated-player games were played violated the tribe’s exclusive rights to offer banked games. A federal judge sided with the tribe in the dispute, which led to concerns that tribe payments to the state could end --- though the tribe did not stop making payments.
The proposed regulation issued by the Division of Pari-Mutuel Wagering would require designated players to “compete and compare their cards against each other to determine the winner(s) of each game.” It would effectively negate the designated-player games.
The new language would “ensure that players compete and compare their cards against each other to determine the winner(s) of each game,” which would end a current practice that allows gamblers to play against a designated player who acts as “the house.”
John Lockwood, a lawyer who represents numerous pari-mutuels, called the proposal a “drastic change” that would have a dramatic impact on gambling operators and workers at the facilities. Lockwood said the change could cost the industry $50 million a year and hundreds of jobs.
“The division’s draft rule would be completely detrimental to the entire cardroom industry in Florida,” Lockwood, told The News Service of Florida in an interview Monday.
The revamped agreement announced between Scott and the tribe last month would guarantee until May 2019 the continued flow of Seminole casino cash to the state budget --- at least $300 million. Before the agreement was announced, legislative leaders had held behind-the-scenes talks about possibly calling a special session, ostensibly because of concerns that the Seminole money could dry up.
Pointing in part to the agreement, legislative leaders said they would not hold a special session. But the agreement was also a way to head off attempts by lawmakers to expand gambling through steps such as allowing slot machines outside of Broward and Miami-Dade counties, something the Seminoles were trying to clip.
Lawmakers had been eager to sidestep a proposed constitutional amendment that will appear on the November ballot and, if approved, will give voters the say-so over thorny gambling issues, now largely controlled by the Legislature. Key Republicans also wanted to ensure a continuation of at least $300 million the Seminoles now plunk into state coffers.
Under the agreement, the tribe will continue making the payments through the 2019 legislative session. In exchange, the tribe will continue to have exclusive rights to offer games such as blackjack at its casinos and will continue to be the state’s only slot-machine operator outside of Miami-Dade and Broward.
But the flow of the money relies, at least in part, on the decision by U.S. District Judge Robert Hinkle, who sided with the tribe in the dispute with the state.
The payments, under the agreement, rely on “aggressive enforcement action against continued operation of banked card games” at pari-mutuel facilities, which have seen revenue from other activities --- such as dog racing --- decline in recent years.