Wednesday, October 27, 2021

The federal government is now investigating Florida’s gambling contract with the Seminole tribe.

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TALLAHASSEE — While Florida lawmakers signed off last week on a far-reaching gambling pact with the Seminole Tribe that includes sports betting, Las Vegas-style casinos, craps and roulette, the deal now will face scrutiny from the U.S. Department of the Interior.

The Biden administration’s role in examining the compact with the Seminoles is somewhat limited, according to experts.

The Department of the Interior oversees tribal-state gambling “compacts,” such as the one that Gov. Ron DeSantis and Seminole Tribe of Florida Chairman Marcellus Osceola Jr. signed April 23 and sent to lawmakers for approval. Once the compact is submitted, the Department of the Interior has 45 days to approve the plan, reject it or allow it to go into effect without the federal agency’s action.

Federal officials will “look at the compact and see if there are any provisions in there that are problematic,” said George Skibine, whose lengthy career with the Department of the Interior included a stint as director of the Office of Indian Gaming. Florida House Speaker Chris Sprowls, R-Palm Harbor, hired Skibine to advise the House about the compact.

The law allows tribes to conduct any types of gambling that are permitted anywhere else in the state. States can enter into revenue-sharing agreements with tribes in exchange for offering them “exclusivity” for certain types of gambling activities or certain geographic areas.

Since taking office in January, Biden tapped former U.S. Rep. Deb Haaland, a New Mexico Democrat and member of the Pueblo of Laguna tribe, as secretary of the department. The U.S. Senate confirmed the appointment of Haaland, the first Native American to serve in a Cabinet post, in March. The federal Indian Gaming Regulatory Act, or IGRA, gives Haaland only a handful of reasons to reject a compact.

Under the 30-year compact signed by DeSantis and Osceola, the Seminoles agreed to pay Florida about $20 billion, including $2.5 billion over the first five years of the agreement. The amount dips by $50 million a year if the sports-betting provision doesn’t go into effect, essentially guaranteeing the state an annual minimum payment of $450 million.

The agreement also puts the Seminoles in control of sports betting. The tribe would serve as the hub for sports betting, with pari-mutuel operators contracting with it. The plan would allow Floridians and visitors anywhere in the state to place sports bets using apps on cell phones, but the Seminoles would host the sports-betting activity through computer servers located on tribal lands.

The sports-betting provision could prove to be a major test of the federal law, which was enacted before online gambling activities began. The Indian Gaming Regulatory Act requires that covered gaming activities occur on “Indian lands,” Skibine noted. The Florida compact could force federal regulators to decide for the first time whether sports bets made on mobile phones or other devices off of tribal lands comply with the 1988 law.

“So the issue that is raised now that there is online gaming, that there wasn’t back in the ‘80s when the act was passed, is whether a bettor can essentially use a computer to place a bet on the reservation, when the bettor is located off the reservation. So that question is going to be one of the key questions, I think, that they will look at,” Skibine said. The deal with the Seminoles may turn out to be a national test case for other tribal compacts, he said.

“It could very well be. I think that the department will have to look at that provision of the compact that says that the entire gaming activity is essentially deemed to occur where the servers are located. They will have to take a look at this issue,” he added. But Jim Allen, CEO of Seminole Gaming and chairman of Hard Rock International, said the tribe believes the sports betting arrangement is on solid ground.

“It’s our feeling, and we certainly have talked to the Department of the Interior, as long as the servers are on sovereign land, we are within the boundaries of the law. I certainly recognize that there are many companies that are trying to derail this,” Allen told The News Service of Florida in a phone interview this month. The Department of the Interior on Monday approved an Arizona compact that allows sports betting, but the details differ from the Florida plan. A New Mexico compact with a sports betting provision is awaiting federal approval.

Before the Florida compact makes it to the Biden administration, the Seminoles’ tribal council must approve the agreement. A vote on the issue is expected soon. The sports-betting arrangement with the Seminoles is aimed at complying with a 2018 constitutional amendment that requires statewide voter approval of gambling expansions in Florida. Under what is known as Amendment 3, expansions of gambling must be placed on the statewide ballot through the citizens’ initiative process.

News Summary:

  • The federal government is now investigating Florida’s gambling contract with the Seminole tribe.
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