Questionable Florida Pari-Mutuel License Award for North Florida Gretna Facility Barrel Racing To Be Used to Leverage Gadsden County Slot Casino Referendum Ballot Request this Tuesday, November 1

This Tuesday, November 1, 2011, the Gadsden County Commission will consider a request by Gretna Racing, LLC to authorize a countywide referendum on allowing slot machines at the Creek Entertainment Gretna facility in Gretna, a small North Florida town with a population of less than 2,000. 

To view the request, click here.

If the Commission allows it, the referendum would be placed on the January 31, 2012 Republican Presidential Preference Ballot.   Most of Gretna’s residents are registered Democrats and 85 percent are African-American, with a median income of $27,000 per year. 

Should the referendum ultimately be approved by Republican voters, it will make Gadsden County the third in Florida to approve Las Vegas-style slot machines. 

James Dorris, CEO of PCI Gaming Authority, a company owned by the Alabama Poarch Creek Indians, will make the request on behalf of his partners, which include Gulfstream Park lobbyist Marc Dunbar and former Gulfstream Park attorney, David Romanik, who briefly served as track CEO. 

 “With its recent and questionable license award from the Florida Division of Pari-Mutuel Wagering, Gretna has deviously positioned its minimal live racing dates to meet the State’s bare minimum requirements to operate slot machines, while insisting it will hold ‘pari-mutuel barrel racing’ so as to not have the expense and, of course, the resultant economic development created by conducting legitimate horse racing,” explained Florida Horsemen’s Benevolent and Protective Association Executive Director Kent Stirling.  “The people of Gretna are being duped.  The jobs that legitimate horse racing operations bring are well known to far and away exceed the economic vortex that this ill-begotten scheme would create.”

Shortly after its approval of the Gretna license, the Florida Division of Pari-Mutuel Wagering was cited by the Florida Auditor General in an October 26, 2011 report for faulty slot machine and cardroom licensing procedures, resulting in lost revenue to the State.  To view the report, click here.

Gretna Racing, clearly confident in its ability to secure the vote, has already published “Gretna Casino” Web sites, which indicate it is expecting a clear path to open its casino later in 2012, while bypassing federal and state law, as well as bona fide pari-mutuel regulation.  On its site, Gretna Casino indicates that it will seek to become a North Florida “gambling getaway.”

Sunshine State News Columnist Kenric Ward Asks: How will Gov. Rick Scott play his hand on destination casinos?

Rick Scott: Casino Tool or Economic Leader?

Posted: October 28, 2011 3:55 AM
Kenric Ward

Casino tools Erik Fresen and Ellyn Bogdanoff want to “control” gaming by opening the door to destination mega-resorts in South Florida.

Good luck with that.

These two lawmakers should have spent a couple of days kicking the tires in Las Vegas, where they would have learned a lot about how casinos control politicians — not the other way around. They also would have seen, firsthand, unemployment and foreclosure rates even worse than Florida’s.

Instead, Fresen-Bogdanoff drank the casino Kool-Aid. Now they’re betting that other equally naive/craven legislators will, too.

The big question is: How will Gov. Rick Scott play his hand?

Deputy press secretary Jackie Schutz said, “The governor cannot comment on the pending legislation until he sees a final bill, but he does not want Florida’s budget too heavily tied to gaming.”

But suggesting he has no aversion to gambling per se, Scott previously indicated that he favored equal tax rates for all gaming ventures.

Scott says he’s all about private-sector jobs. So, of course, the Genting Group, Las Vegas Sands and other casino sharpies are promising jobs, jobs, jobs.

The Malaysia-based Genting, which bought the Miami Herald complex to anchor “the world’s biggest casino,” says it will create 100,000 new positions.

Whether that’s a real number is debatable, but one thing is certain: The gaming industry hires mainly low-skill, low-pay workers (that’s how Las Vegas became a union town) and sucks off the local economy.

While Floridians can safely take the “under” on private-sector wages, they should bet the “over” on government jobs. Fresen-Bogdanoff’s 142-page casino bill is a full-employment act for an entirely new government bureaucracy, complete with gaming-control agents, gaming lawyers and untold legions of paper shufflers. The more “full-service” the resorts, the bigger the government support network.

If the 2012 Legislature approves Fresen-Bogdanoff, expect legal challenges early, says William Thompson, a professor of public administration at the University of Nevada, Las Vegas.

“There are probably going to be lawsuits all around from those [companies] that don’t get licensed,” he said.

By capping the number of resort licenses in Miami-Dade and Broward counties at three, the casino bill puts Florida in never-never land, Thompson said.

“You need the synergy of 10 or more big casinos to attract the best players,” noted Thompson, who has studied and written about the gaming industry for more than three decades.

Having worked as a journalist in Las Vegas for 13 years, I can tell you that casino operators will say and do anything to get a gaming license and expand their reach.

Genting is already working both sides of the street. First, it dazzles politicians with the biggest conceivable project. Then, when concerns arise about the cannibalization of existing businesses, it strategically scales back.

Once they’re licensed, casinos push relentlessly for more exclusions, exceptions and favors from the politicians who ostensibly regulate them. Think that will be a problem in corruption-ridden South Florida?

You can imagine the peals of laughter from casino moguls reading this sage advice from a Herald columnist:

“It all depends on how Florida legislators would regulate mega-casinos. If gaming corporations are allowed to build giant resorts with blinking lights, surrounded by “Girls, Girls, Girls” signs, pawn shops and casino company buses roaming the city offering free rides to take seniors to the gambling places, it will kill Miami as an international business center.

“On the other hand, if legislators demand that mega-casinos have a discreet appearance … and if there are laws to prevent Miami from becoming a mecca for prostitutes, drunks, pickpockets and con artists, the proposed casino resort could be a good addition.”

When it’s all about cosmetics, the gamers win. Once government banks on games of chance, the odds swing heavily to casinos. Every rule becomes negotiable. Regulatory maximums become minimums to be raised.

Any attempt to rein in casinos or increase tax rates is reflexively, and effectively, denounced as “killing the goose that laid the golden egg.” By setting a ridiculously low gaming tax of 10 percent, Fresen-Bogdanoff quickly signaled that they’re horrible poker players.

Gaming companies run numbers for a living, and know a sucker from a mile away. They’re not about to have their business models challenged by bureaucrats or “the people’s representatives.”

Gov. Scott, who has loads of private-sector experience, knows a thing or two about the foibles of government regulation. As a native of Illinois, he also should be well aware of the gaming industry’s deleterious fiscal and social effects on that state.

Politically speaking, this is a no-brainer. The Florida Chamber of Commerce and virtually the entire tourism industry oppose an expansion of gaming. Florida voters have repeatedly voted down casino initiatives, and even the liberal St. Petersburg Times  ridiculed this latest scheme.

Las Vegas, Atlantic City and 900 cheesy casino venues in between stand as monuments of a contemptuous and parasitic enterprise that promises money for nothing.

If Scott intends to lead Florida to meaningful economic growth, that’s a promise and a premise he must summarily reject.

Reach Kenric Ward at kward@sunshinestatenews.com or at (772) 801-5341.

 

About the Florida Horsemen’s Benevolent and Protective Association (“FHBPA”)

Part of the National Horsemen’s Benevolent and Protective Association, the FHBPA fosters, promotes and encourages a healthier economic climate and a higher level of public acceptance of the thoroughbred horse industry in the State of Florida and better relations among its participants. Importantly, it also protects the safety of members, their stable personnel and their horses, and works with racetrack management to ensure acceptable training and stable area conditions, and proper emergency preparedness and procedures.  The FHBPA strives to bring about a closer and more understanding relationship between Florida horsemen, Florida racing associations, the State of Florida and its various branches of government, including but not limited to, the Department of Business and Professional Regulation, Division of Pari-mutuel Wagering, and its departments and sub-divisions, and the public.  www.fhbpa.com

FHBPA Notes: On heels of gaming bill, audit finds Florida Division of Pari-mutuel Wagering not properly apply its rules regarding oversight of pari-mutuels

By Gray Rohrer, 10/27/2011

www.TheFloridaCurrent.com

An auditor general’s report out Thursday found the Department of Business and Professional Regulation did not properly apply its rules regarding oversight of pari-mutuels.

The report found that beginning on July 1, 2009, DBPR’s Division of Pari-mutuel Wagering issued three-year occupational licenses for slot machines at rates of $100 for individuals and $2,000 businesses, instead of at rates of $150 and $3,000, respectively, as their rules stipulate. The discrepancy cost the state $105,300, according to the audit. The division filed to change the rule to the lower rates in October 2010, but it has not been implemented.

As of Feb. 28, DBPR has issued six three-year occupational licenses for card rooms, instead of annual licenses as DBPR rules require. DBPR contended that a recent state law allows them to issue three-year licenses, but the department has not yet put in place a rule outlining that authority, so the annual requirement is still on the books.

DBPR also accepted monthly reports of slot machine and card room licensees without requiring them to be submitted under oath, as state law requires.

The report comes one day after a bill to allow three resort casinos in South Florida was filed. The bill also would  remove DBPR’s oversight of gaming operations and replace it with a Gaming Commission with broader powers to create and enforce rules governing gaming in the state.

Sen. Ellyn Bogdanoff, R-Fort Lauderdale, is sponsoring SB 710 and thinks the commission is needed to set Florida’s “strategic direction” on gaming.

“Yes, the regulation needs to be tight,” Bogdanoff said Thursday. “This commission would definitely clean that (lax oversight) up.”

A lineup of heavy-hitting interests is moving to stop the bill, and criticism of the nominating process of the seven-member commission already is being leveled.

John Sowinski is the president of No Casinos, the group dedicated to halting the expansion of gaming in Florida. He said the nominating structure of the commission would exacerbate the influence of moneyed interests in Tallahassee. The process, which would allow the House Speaker and Senate President to appoint members of a nominating committee to give candidate names to the governor for selection, would be a fundraising boon for the legislative leaders, Sowinski said.

“It would make what’s going on in Tallahassee a permanent condition, and that is reason enough to vote against it,” he said Wednesday.

Bogdanoff took umbrage at that characterization of the commission, and asserted that the nominating structure provides enough layers to guard against undue influence.

“I find that actually insulting,” she said of Sowinski’s comments. “It’s the best way to take politics out of the process and not violate the (state) constitution.”

To view this story on The Florida Current Web site, go to:  http://www.thefloridacurrent.com/article.cfm?id=25163584

 

About the Florida Horsemen’s Benevolent and Protective Association (“FHBPA”)

Part of the National Horsemen’s Benevolent and Protective Association, the FHBPA fosters, promotes and encourages a healthier economic climate and a higher level of public acceptance of the thoroughbred horse industry in the State of Florida and better relations among its participants. Importantly, it also protects the safety of members, their stable personnel and their horses, and works with racetrack management to ensure acceptable training and stable area conditions, and proper emergency preparedness and procedures.  The FHBPA strives to bring about a closer and more understanding relationship between Florida horsemen, Florida racing associations, the State of Florida and its various branches of government, including but not limited to, the Department of Business and Professional Regulation, Division of Pari-mutuel Wagering, and its departments and sub-divisions, and the public.  www.fhbpa.com

The Paulick Report: Florida HBPA responds to new destination gaming legislation

by Paulick Report Staff | 10.27.2011

From www.paulickreport.com

As expected, legislation was filed Wednesday in the Florida legislature that would allow three full-scale casino resorts to be built in South Florida.  Debate will officially begin when state lawmakers reconvene in January, but the lobbying from both sides has already started.

Florida Horsemen’s Benevolent and Protective Association Executive Director Kent Stirling issued this statement:

“There’s no question that Florida’s horse racing industry is chagrined at today’s filing of the destination gaming bills.  In its wisdom, our State Legislature has ensured that Florida law reminds us that the State’s horse racing industry is a $6.3 billion dollar annual economic driver and provides crucial agricultural and tourism infrastructure that reaches far into our employment base—something that no destination resort will ever do.  As documented by a national Deloitte economic study, for every horse that walks onto a racetrack in Florida, seven jobs are created.”

“Over the years, our Legislature has carefully nurtured horse racing to ensure the perpetuation of its acknowledged job creation ability, economic impact and pageantry, we also are confident that, in their efforts to employ Floridians by ensuring the future of Florida’s existing industrial base, our elected officials will not fail in their good efforts.”

 

About the Florida Horsemen’s Benevolent and Protective Association (“FHBPA”)

Part of the National Horsemen’s Benevolent and Protective Association, the FHBPA fosters, promotes and encourages a healthier economic climate and a higher level of public acceptance of the thoroughbred horse industry in the State of Florida and better relations among its participants. Importantly, it also protects the safety of members, their stable personnel and their horses, and works with racetrack management to ensure acceptable training and stable area conditions, and proper emergency preparedness and procedures.  The FHBPA strives to bring about a closer and more understanding relationship between Florida horsemen, Florida racing associations, the State of Florida and its various branches of government, including but not limited to, the Department of Business and Professional Regulation, Division of Pari-mutuel Wagering, and its departments and sub-divisions, and the public.  www.fhbpa.com

The Miami Herald: In a move designed to shift Florida’s gambling focus, two new bills would award exclusive full-casino licenses to three massive “destination resorts” and leave the struggling pari-mutuel industry to wither

State Representative Erik Fresen filed three highly anticipated destination gaming bills today, October 26, 2011.  Summaries of these proposals and hyperlinks to complete bill information are below, along with news coverage from the Miami Herald:

HB 0491 Relating to Pub. Rec./State Gaming Commission by State Representative Erik Fresen

Provides exemption from public records requirements for confidential & proprietary business information & trade secrets received by State Gaming Commission; provides exemption from public records requirements for information held that would reveal investigation techniques & procedures used by State Gaming Commission; provides exception to exemption for other governmental entities having oversight or regulatory or law enforcement authority; provides penalties for employee of commission who violates provisions of act; provides for future review & repeal of exemption under Open Government Sunset Review Act; provides statement of public necessity.  Effective Date: on the same date that HB 487 or similar legislation takes effect, if such legislation is enacted in the same legislative session, or an extension thereof, and becomes law, and only if this act is enacted by a two-thirds vote of the membership of each house of the Legislature

 

HB 0489 Relating to Trust Funds/Destination Resort Trust Fund/Department of Gaming Control by State Representative Erik Fresen

Creates Destination Resort Trust Fund within Department of Gaming Control; provides for purpose of trust fund; provides for future review & termination or re-creation of trust fund. Effective Date: on the same date that HB 487 or similar legislation takes effect, if such legislation is enacted in the same legislative session, or an extension thereof, and becomes law, and only if this act is enacted by a three-fifths vote of the membership of each house of the Legislature

 

HB 0487 Relating to Gaming by State Representative Erik Fresen

Creates State Gaming Commission & Department of Gaming Control to oversee pari-mutuel wagering, slot machines, & gaming; deletes Division of Pari-mutuel Wagering within Department of Business and Professional Regulation to conform; redesignates ch. 551, F.S., relating to slot machines, as pt. II of that chapter; creates pts. I & III of ch. 551, F.S., relating to State Gaming Commission & destination resorts, respectively; revises provisions in chs. 550 & 849, F.S., relating to pari-mutuel wagering & gambling, respectively, to conform; conforms other provisions of law. Effective Date: July 1, 2012

 

The Miami Herald
 

Casino bill sacrifices horse and dog tracks for mega-resorts

By Mary Ellen Klas
Herald/Times Tallahassee Bureau

 

The slot machines at Gulfstream Park and Casino in Hallandale Beach.
Peter Andrew Bosch
The slot machines at Gulfstream Park and Casino in Hallandale Beach.
In a move designed to shift Florida’s gambling focus, two new bills to be filed Wednesday would award exclusive full-casino licenses to three massive “destination resorts” and leave the struggling pari-mutuel industry to wither.The goal of the proposals by Rep. Erik Fresen, R-Miami, and Sen. Ellyn Bogdanoff, R-Fort Lauderdale, “is to reduce gaming in the state and have the kind of gaming that is actually going to produce revenue,’’ Bogdanoff said.

That would mean no equal treatment for South Florida’s eight racinos — race tracks and casinos — which would pay higher tax rates than the new casinos and be allowed to operate only pari-mutuel and slot machines. It would mean no more monopoly for the Seminole Tribe, which would lose its exclusive right to operate blackjack, baccarat and other table games at their seven Florida casinos and would stop making annual payments to the state.

Instead, the bill would allow full Las Vegas-style games at three locations in South Florida in exchange for a $2 billion investment each in high-end “destination resorts.” Applicants would pay $50 million for the right to compete for the licenses and would be judged on their ability to draw tourists from Latin America, Asia, Europe and across the U.S., Bogdanoff said.

“Florida is considered the fourth largest gambling state in the nation, but it has let the industry drive policy decisions and that has produced the worst kind of gaming,’’ she said Tuesday. “To me, no kind of gaming is good, but we, as policymakers, have to decide, do we want gaming with five-star hotels or Internet cafes in strip malls?”

To that end, the authors have carefully cleansed the bill of any emphasis on gambling. The 142-page overhaul of state gambling regulations never uses the word “casino” but instead refers to the facilities as “limited gaming” and calls the legislation the “Destination Resort Act.”

Bogdanoff concedes that while her goal is to reduce gambling by allowing the pari-mutuel industry to shrink, that industry is a powerful political force that will work to insert provisions into the casino bill to protect themselves. Florida’s 55 horse and dog tracks, jai-alai frontons and card rooms have been financially stagnant for the past decade and have been forced to return to the Legislature every year to get additional games, lower tax rates and longer hours to remain profitable.

Bogdanoff believes that in order for the bill to pass the Senate, where the influence of Florida’s horse and dog tracks is strong, it may need to be modified to give the pari-mutuels the same tax rate as the casino resorts would get — 10 percent, a drop from their current 35 percent rate.

“That bill will look like a dog chewed on it when it gets out of the Senate and the House will have to decide what it wants to do,’’ she said. “We’re going to have to let it play out.”

Dan Adkins, president of Mardi Gras Gaming and Racetrack in Hollywood, wants his industry to be treated equally to the resort casinos, but urged Fresen and Bogdanoff to slow down before they leap ahead with the massive bill.

“There could be huge negative impacts on surrounding businesses like hotels, restaurants and retailers,’’ he said Tuesday, “not to mention the loss of revenue and jobs from the existing casino-racino industry and the Seminole compact.’’

The 10 percent tax rate proposed for the resort casinos is the lowest in the nation, except for Nevada’s 6.5 percent tax rate on gambling. Pennsylvania, West Virginia and Ohio have tax rates in excess of 30 percent. “A detailed thorough study is the only way to prevent a negative irreversible situation,’’ Adkins said.

Bogdanoff and Fresen have no plans to slow down. Their bill not only shifts the state’s focus, it creates a new state agency to do it and it puts in place a steady timeline that could have the state awarding licenses by July 2013, one year after the bill would become law.

Awaiting the opportunity to bid on a “destination resort” license are several companies, including Genting Americas. The Malaysian-based company purchased The Miami Herald property in May and is leasing the land back to the company for two years, rent free, as it works to persuade Florida lawmakers to authorize resort casinos.

Here are some of the major components of the 142-page bill, which would be taken up when the Legislature holds its two-month session beginning in January:

•  Three resort casinos would be authorized in Miami-Dade and Broward, the two counties that now offer slot-machines gaming.

In return for the exclusive licenses, casino operators must commit to investing at least $2 billion on entertainment, convention center and resort complexes intended to draw tourists and high-rolling gamblers. The price tag to participate is $50 million, refunded if the state rejects a company’s bid.

•  Casinos would pay 10 percent tax on net revenues. That is less than the 35 percent tax rate now imposed on the revenues of the state’s eight pari-mutuels with slot machine licenses in South Florida.

•  Casino space must be no more than 10 percent of the total square footage of the facility.

•  Casino games would include slot machines, roulette wheels, craps, poker, blackjack, baccarat and other table games.

•  The casino space would be segregated from other attractions, so that a visitor can attend the resort without ever having to see the gambling venues.

•  Applicants for the “limited gaming” license would be judged based on their ability to “increase tourism, generate jobs, provide revenue to the local economy and provide revenue to the General Revenue Fund.”

•  The bidders would be scored based on a system that gives 35 percent weight to the proposal’s design and location, 10 percent to the company’s management expertise, 35 percent to the speed with which it can get its plans to market, 10 percent to its access to capital, and 10 percent to its community plan.

•  Key employees of the casinos would have to pay a $5,000 application fee for an occupational license and undergo an extensive background check. Suppliers would pay a $25,000 license and each resort would pay a $50,000 alcoholic beverage license.

•  Casinos would be open 24 hours a day, every day of the year, and be allowed to serve alcohol during all of those hours.

•  Resorts would have to prove financial strength and ability to “train and employ residents” including training of “low-income persons.”

•  A State Gaming Commission would be created to select the winning bidders. It would be headquartered in South Florida and have broad authority to not only issue the licenses but to investigate and issue subpoenas, take enforcement action, collect taxes and impose fees and penalties. It would be exempt from public disclosure rules for some financial data and would be allowed to hold some of its meetings in secret.

•  The commission would serve as the head of the Department of Gaming Control, the state agency that replaces the current Division of Pari-mutuel wagering.

•  The commission would be composed of seven members with staggered four-year terms. They would be appointed by the governor and include an accountant with gaming experience and a veteran law enforcement officer. Three names would be nominated for each post by a nominating committee of legislators appointed by the House speaker and the Senate president.

•  Commission members would be paid $125,000 yearly and the chairman, named by the governor, would be paid $135,000.

•  Strict limits would be placed on who can serve on the commission, including a ban on banning anyone with a personal or financial relationship to any of the applicants or anyone who has been under indictment or been charged with a gambling violation or fraud.

•  All casino owners and partners would have to undergo strict background checks, including financial screening.

•  The Department of Gaming Control would contract with the Florida Department of Law Enforcement to assist in investigations and enforcement and contract with the Department of Revenue to assist in tax collection and investigation.

Mary Ellen Klas can be reached at meklas@MiamiHerald.com and on Twitter at MaryEllenKlas

 

Nick Sortal’s Sun-Sentinel “Action” South Florida Gambling Blog: State approves barrel racing (a work-around to get poker)

 

By Nick Sortal

October 20, 2011 10:56 AM

barrelracing.jpg

In the latest move by some pari-mutuels to do the bare minimum to qualify for other forms of gambling, a horse track west of Tallahassee went to the state and got approval for barrel racing.

Never bet on barrel racing before? Well, apparently nobody has.

The National Barrel Horse Association, based in Augusta, Ga., tells the Bloodhorse’s Jim Freer that to his knowledge, wagering on an event seen mostly at rodeos is new turf.

Freer, who does a great job following the off-track issues of racing, said Gretna Racing LLC also plans to have a year-round poker room starting Dec. 17.

The Florida Division of Pari-Mutuel Wagering approved the application Wednesday. It doesn’t spell out barrel racing per se, but Marc Dunbar, a Tallahassee attorney who is a 10% owner of Gretna Racing, told Freer that was the plan.

Horsemen protested to the state, saying it’s obviously a work-around. That’s because Florida pari-mutuels who meet minimum requirements of races/jai-alai matches get to run a poker room year-round.

Some folks argued that’s what happened at Hialeah Park the past couple of years, as the former grand dame of racing reopened with quarterhorse racing in order to qualify for a slot permit. The casino is under construction, despite an unrelated legal challenge.

About Nick Sortal
 
Maybe you’ve made the right play, maybe you haven’t. Your heart speeds up, your stomach rumbles.That’s why it’s called gambling.

ACTION is a view of the numbers, the psychology and the flavor of gambling here in South Florida, through our lens.

We do have one sure bet. There’s something here for you.

NICK SORTAL began playing 3-card “gut” and “Indian poker” on high school band trips, moved on to “night baseball” and “pass the trash” during a Dr. Pepper-infused midnight game in the 1980s at the St. Louis Globe-Democrat, and now play in a regular neighborhood Hold ‘Em game in Plantation. I have been given the assignment of writing about the gambling life in South Florida casinos for the Sun-Sentinel…which means sitting around watching poker on TV now counts as research.

 

To view this story on its own Web page, click here.