Future of Gambling in Florida Looks Shaky

Capitol building in Tallahassee, Florida
Florida politicians are examining how to legalize sports betting in the wake of Amendment 3.

30-second summary

  • Seminole Tribe casino deal expires in May
  • State currently receives around $343m (£261.5m) in annual revenues
  • Senate President Bill Galvano pushing to renew deal
  • Galvano also wants legalized sports betting
  • But Floridian voters control gambling expansion

Controversy over Amendment 3

The future of gambling suddenly looks very uncertain in the Sunshine State after voters passed Amendment 3 to Florida’s constitution in November 2018. The amendment means voters must approve any new gambling proposals, such as new casinos, by a 60% majority.

The Walt Disney Corporation and the Seminole Tribe of Florida both supported Amendment 3. Between them, they donated £36m to campaign against loosening gambling laws in the state.

In Disney’s case, the entertainment company wanted to preserve Florida’s “family-friendly” reputation.

The Seminole were concerned about losing revenue to other forms of gambling such as sportsbooks if the law were to change in favor of expanding opportunities for gambling companies.

Pushing to block the amendment were sports leagues such as the NFL. The Miami Dolphins were keen on the possibility of sports betting on their games.

Florida draws millions of tourists every year – 116.5m in 2017 – making it an attractive location for gambling operators looking to expand. But for now, at least, that possibility is not on the cards.

Seminole casino compact expiring

The Seminole Tribe, which owns seven casinos in Florida, has regularly negotiated agreements with the state government over its right to offer gambling. The casinos currently turn over more than $1.5bn (£1.14bn) annually. Revenues are taxed at 26%, generating around $343m annually for the state.

The current compact will expire in May 2019, and discussions on its renewal have not yet begun. Florida state legislators believe the economy is strong enough that the state does not have to rely on those revenues.

The Legislative Budget Commission has estimated a budget surplus of $223m (£170m) surplus (0.6%) for the financial year beginning July 1. The estimated general revenue for the state next year is $34.6bn (£26.4bn), dwarfing the income from the Seminole casinos.

However, Amy Baker, head of the legislature’s office of economic and demographic research, said the budget forecast for 2020-21 estimates a revenue shortfall of $48m (£36.6m) and another shortfall of $457m (£348.4m) for 2012-22.

Florida may still need to negotiate a new compact quickly to keep the tribe’s revenues flowing in.

Senate President Bill Galvano said a new deal with the Seminole would remove any uncertainty. He said: “We are in a dubious state right now, and I think it is worthy of us to create stability with the Seminole Tribe.”

Sports betting

Galvano also indicated he was keen to push forward on sports betting. When Floridian voters opted to bring in Amendment 3, they also voted to end greyhound racing by 2020.

He said: “We are operating in a different world post-constitutional amendments, but I think there is an opportunity for sports betting in the state of Florida. It’s an activity that is occurring and not regulated, and we are not collecting and sharing revenues from that activity.”

The Republican has not yet offered any suggestions for draft legislation when the legislature reconvenes in March, but the Senate’s innovation, industry, and technology committee has been tasked with reviewing the options, given the limitations created by Amendment 3.

However, Amendment 3 does not explicitly exclude sports betting, meaning the legislature could legalize it without voter approval.

Draft legislation could be ready before the next legislative session.