Doggone it: Regulators rile gambling competitors

Florida gambling regulators this week gave a Miami track permission to do away with dog races but to keep more lucrative slots and card games.

The Florida Department of Business and Professional Regulation allowed Magic City, in Miami, to ditch the dog races in exchange for operating jai alai matches.

The decision was rooted in a 1980 law that allows Miami-Dade and Broward pari-mutuels that have the lowest betting handle for two consecutive years to convert to summer jai alai permits. But if those pari-mutuels do not seek conversion, other facilities can seek the permits.

Owners of Mardi Gras, a rival dog track of nearby Magic City, sought to intervene in the case. But the state agency rejected those efforts in the declaratory statement issued Wednesday.

In an early-morning interview Friday, Dan Adkins — vice president of Hartman and Tyner, which owns Mardi Gras — told The News Service the agency’s decision wasn’t what lawmakers intended when they passed the law decades ago.

But Adkins said he wasn’t sure if he’ll appeal the decision.

“We probably won’t. I’m getting tired of playing by the rules. Everybody else gets away with breaking the rules, gets away with going around scamming the system. That’s what this is. So maybe I’m going to have to find my own way to game the system,” Adkins, repeatedly saying he did not blame lawyer John Lockwood, who represents West Flagler Associates, or his Magic City competitor for trying to push the envelope.

Even so, Adkins maintained, “this is not the way this regulated industry should operate, especially when people are gambling on it.”


“Flag-drop” races under scrutiny, again

It’s clear gambling regulators weren’t keen on a horse race between two aging nags on a dirt path, with the race launched by a red rag on a stick.

But what’s less clear is whether the regulators had the authority to punish a tiny North Florida horse track that ran the race.

The controversial “flag drop” race three years ago at Hamilton Downs between two horses owned by the same woman was the focus of a hearing Tuesday before a three-judge panel of the 1st District Court of Appeal.

Read the story here.


Sunshine State boosts Moody’s bond rating for Seminoles

Moody’s has upgraded the Seminole Tribe of Florida’s bond ratings, thanks in part to improvements at its two Florida casinos and also to the tribe’s continued payments to the state for banked card games, including blackjack.

Guitar-Marquee-672x372The Seminoles have continued to make the payments even after a federal judge ruled last year that the state had breached a provision in a 2010 agreement that gave the tribe “exclusive” rights to offer the card games. State gambling regulators breached the exclusivity provision in the agreement, called a “compact,” by allowing pari-mutuel operators to conduct controversial “designated player” games, also known as “banked player” games.

U.S. District Judge Robert Hinkle ruled last fall that the tribe is entitled to continue running the games for the remainder of the 20-year compact. The provision allowing the banked card games expired in 2015, but the compact included language permitting the tribe to continue to operate the games if the Seminoles lost exclusivity.

Last week, Moody’s Investor Services upgraded the tribe’s existing term debt and bonds to Baa2 from Baa3, and its Special Obligation Bonds to Baa3 from Ba1.

The upgrade was based in part on the Seminoles’ investments in the tribe’s two biggest casinos — both in Florida — and its continued payments to the state, according to a press release issued by Moody’s Thursday.

“The one-notch upgrade of the Tribe’s ratings reflect Moody’s expectation of continued exceptionally strong credit metrics along with further and substantial investment in the Tribe’s two largest casinos that will help the Tribe maintain its dominant market position over the long-term,” Keith Foley, a Senior Vice President at Moody’s, said in a press release Thursday. “Even with the significant planned capital investment, the Tribe will be able to maintain very low leverage, at less than 2.0 times,” added Foley.

The tribe’s two “largest casinos” are the Seminole Hard Rock Hotel & Casino Hollywood, in Broward County, and the Seminole Hard Rock Hotel & Casino Tampa, on the other side of the state.

The revamped bond rating also takes into consideration the tribe’s continued payments to the state — in excess of $150 million — for the card games, according to the press release.

“The upgrade also considers Moody’s favorable view of the Tribe’s decision to continue to make revenue payments to the State of Florida despite a ruling in the Tribe’s favor that entitles the Tribe under the existing compact, which expires in 2030, to withhold revenue share payments. The ruling is related to the State’s decision to allow others (other than another Indian tribe) to conduct banked card games. As a result of that lack of exclusivity, the Tribe is entitled under the existing compact to conduct banked card games at all of its 7 casinos through 2030 without having to share revenue with the State. Despite the ruling, the Tribe continues to make revenue payments to the State and has not offered banked card games beyond the original 5 facilities allowed by the compact,” the June 15 release reads.

The tribe was unable to strike a new deal with lawmakers and Gov. Rick Scott during the regular session that ended in May. Scott and tribal leaders inked an agreement late in 2015, but the Legislature failed to give it the requisite approval.

Fitch Ratings also affirmed the Seminoles BBB rating last week.

The Seminoles’ “gaming division continues to experience steady, positive operating trends compared to more flat growth seen in other U.S. gaming markets,” Fitch noted in Thursday’s statement.

The Tribe and Seminole Gaming hailed the financial market news.

“The ratings upgrades, affirmations and strong new ratings are great news for the Seminole Tribe of Florida as we look toward a solid, stable future for the Tribe,” Chairman Marcellus Osceola Jr. said in a statement. “It means our Tribal members, employees, customers, vendor partners and community residents can count on many good years ahead.”

Seminole Gaming CEO Jim Allen said, “These improved and renewed investment-grade ratings will save millions of dollars by helping to keep borrowing costs low. They will help Seminole Gaming to continue as one of the world’s most profitable gaming enterprises.”

Hard Rock to spend $500M on Taj Mahal overhaul

Jim Allen, the gambling guru who’s the CEO of Seminole Gaming and chairman of Hard Rock International, said his company is prepared to plunk down $500 million to renovate Atlantic City’s Taj Mahal, the shuttered casino built by President Donald Trump in 1990.

Hard Rock finalized the purchase of the Taj for a reported $50 million in March, long after Trump was no longer affiliated with it.

Allen is a familiar face in the Capitol. For years, the Atlantic City native has been the key point man in the tribe’s negotiations with Florida officials over a deal known as a “compact.”

According to a CDC Gaming Reports story by Aaron Stanley, Allen recently told a gathering of gambling execs that the Taj — and his Atlantic City hometown — are poised for a turnaround.

The Seminoles pulled the plug on a massive overhaul of the Seminole Hard Rock Hotel & Casino Tampa after the Legislature refused to sign off on a deal inked by tribal leaders and Gov. Rick Scott late in 2015.

Lawmakers again failed to approve a revised compact with the Seminoles during the session that ended earlier this month, leaving unresolved questions about the future of  the tribe’s exclusive rights to offer banked card games, such as blackjack, at most of its casinos. A federal judge sided with the Seminoles in a dispute about the games, but the state has indicated it intends to appeal.


Gambling stalemate over slots?

About a dozen pari-mutuel lobbyists were huddled inside Rep. Jose Felix Diaz’s suite late this afternoon, as the clock winds down on the legislative session without a gambling deal in hand.

The biggest issue dividing the two chambers?

That’s an easy bet — slots.

The Senate wants to allow the lucrative machines in eight counties — Brevard, Duval, Gadsden, Hamilton, Lee, Palm Beach, St. Lucie and Washington — where voters have approved the one-armed bandits for local tracks or frontons.

The House, meanwhile, continues to balk at what they view as an expansion of gambling, and left the referendum counties out of its plan. Diaz, R-Miami, didn’t include the expansion of slots in an offer he made to the Senate Wednesday.

The Senate’s chief negotiator on the gambling deal, Bill Galvano, late Friday called the issue of the referendum counties “the elephant in the room,” implying that the House has to move on slots or there’s no deal.

The Florida Supreme Court last year heard arguments in a case focused on whether facilities in the counties can add the machines without the express permission of the Legislature. But Thursday after Thursday, when the court opinions are released, has gone by without the highly anticipated decision.

Galvano said late Friday evening he’s waiting for a “substantial” offer from his counterpart.

“They understand that that’s an important issue for us, here in the Senate,” Galvano, R-Bradenton, said.

Galvano said all of the counties need to be included in the plan because “that’s when you’re going to run into problems, if you cherry-pick, constitutionally.”

Galvano, who takes over as Senate president after next year’s November elections and who was instrumental in crafting a gambling deal with the Seminoles in 2010, acknowledged that the House has a more conservative approach toward gambling than the Senate.

“They want to make sure, as we’re resolving these court issues, that we’re retracting at the same time. So I’m open to how they want to make their offer, and if they have a more aggressive way of buying back permits, that’s great. We’ll consider it,” he said. “At the same time, (the issue of the referendum counties) that’s the elephant in the room. So we either need to know that that’s a non-starter for them or we can have a negotiation over that.”

Posted by Dara Kam

DLP — Alex — looking for comeback…again

30221_122412807771468_6180180_nFormer state Sen. Alex Diaz de la Portilla, part of a Miami-Dade political dynasty, is mulling a return to the upper chamber, an opportunity made possible by the recent resignation of former Sen. Frank Artiles.

Artiles, R-Miami, stepped down Friday amid a firestorm over a public tirade that included racially charged and vulgar expletives. The targets of Artiles’s alleged tongue-lashing at the members-only Governor’s Club near the Capitol included Senate President Joe Negron and his GOP leadership team.

The Diaz de la Portilla clan have played a major role in Miami-Dade politics for decades, and Alex DLP (as he was known in the Capitol) served as  majority leader from 2008-2010 before being term-limited out of Senate.

He made an unsuccessful run for the House — where he served before being elected to the Senate — in 2012, losing a heated contest to Jose Javier Rodriguez, a Democrat who also defeated Alex’s brother, Miguel, in a battle over a redrawn Senate seat last November.

But, in a call to The News Service of Florida Wednesday afternoon, Alex DLP said he’s seriously pondering a run for SD 40, a Western Miami-Dade seat. DLP, who represented portions of the district for six years, said he is well-suited for the post.

“I know them and they know me. I have a proven track record of being an effective senator, providing good constituent service and also getting along with my colleagues in Tallahassee, with other senators of all groups, of all parties. That’s important in the Senate,” he said.

The Senate is “a very collegial body” that needs “somebody with stability at this time of crisis,” he said.

State Rep. Jose Felix Diaz has been widely considered a favorite to run for the seat. The Miami Republican is one of House Speaker Richard Corcoran’s leadership team, and is playing a major role in negotiating a gambling package with the Senate, Gov. Rick Scott’s administration and the Seminoles.

Alex DLP, who spent 16 years in the Legislature, said he’s already proven himself to be an effective senator.

“We need someone who’s a proven senator, a successful senator, and someone who knows the community,” DLP, 52, said. “So I’m very strongly considering running and I’ll make a decision rather quickly because there’s going to be a special election, and I think the people in this district need a good senator. An even handed senator, a level-headed senator, a mature senator, that’s the kind of thing that will make for an effective advocate for people’s causes.”

Asked if that was a contrast to Artiles, Diaz de la Portilla pivoted.

“We need to move forward. What happened happened. I’m a person that looks to the future. I think now is the time to heal…and we need to move forward. And I think I’m the person who can best do that, to bring all communities in this district together,” he said.

— Posted by Dara Kam

Senate president slots smack-down

Senate President Joe Negron may have upped the ante Thursday  as House and Senate leaders prepare to start negotiations over the two chambers’ vastly different gambling bills.

Rep. Mike La Rosa, the House’s bill sponsor, says he’s “been very, very consistent” about whether to allow slot machines at pari-mutuels in the eight counties where voters have approved them, something included in the Senate’s gambling package but left out of the House plan.

“That’s just a non-starter,” the St. Cloud Republican told reporters when asked about the issue Thursday.

A question about the “non-starter” comment drew a lengthy response that verged on a diatribe from Senate President Joe Negron a few hours later.

Allowing slots in the eight counties — Brevard, Duval, Gadsden, Hamilton, Lee, Palm Beach, St. Lucie and Washington — is a “strong priority,” the president told reporters.

“There’s no basis” for lawmakers to “stand in the way” of or “ignore” the will of the voters, Negron said.

“If you don’t want to play slot machines in the eight counties that have approved it, then you can do other things with your time and your money. But the voters went to the polls. These are the same voters that elected us. They went to the polls. They know what they’re doing. They know what the referendums say, and they have voted to grant their community more gaming opportunities. It is not the place of the Legislature to substitute our judgment for the judgment of voters. That should be given the highest level of respect, and whether we personally agree or disagree with those decisions is immaterial,” Negron, R-Stuart, said. “It’s presumptuous for any legislator to know that voters have expressed their will through a referendum, and then somehow it’s perceived that the Legislature is in a position to say well, that’s an interesting development, we appreciate your opinion but we don’t agree with the outcome, so we’re not going to implement your will. I think that’s not a responsible way to legislate and I think it flips where our system is.”

Lawmakers “work” for the voters, Negron added.

“When they tell us by majority votes in eight communities that we want to have an additional gaming opportunity in our community, there’s no basis, in my opinion, for us to stand in the way of that, to ignore it, or to say, well, we personally don’t agree with it, so we’re going to simply not follow it. I think that’s not a conservative point of view. It’s a view that is elevating the legislator above the wishes of the constituent. And that’s not how our system works,” he concluded.

___ Posted by Dara Kam