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Florida Legislature 2005 (click for ongoing coverage)

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Slot machines face tough odds in Legislature

The House favors bingo-style gambling, but the Senate wants the lucrative Las Vegas version.

By JONI JAMES
Published April 28, 2005

TALLAHASSEE - The parimutuel industry overcame years of legislative objection last November when it convinced Florida voters to amend the state Constitution, raising the prospect of slot machines in South Florida.

Five months later, gambling opponents in the House of Representatives are poised to thwart the plan.

The parimutuels could find themselves empty-handed or headed to court.

The issue before lawmakers is what voters meant when they approved "slot machines."

The House on Wednesday tentatively approved a plan backed by Gov. Jeb Bush that would allow only the bingo-style machines already found in the state's Indian casinos.

The House wants to tax the machines' proceeds at 55 percent, raising between $180-million and $270-million annually.

Members of the Senate, traditionally more receptive to gambling interests, are poised to approve a plan that would allow the more lucrative Las Vegas-style slot machines. Proceeds would be taxed at 30 percent to 35 percent, raising an estimated $382-million a year.

With eight days left in the annual legislative session, Senate President Tom Lee on Wednesday gave lawmakers "less than a 50-50 chance" of passing any legislation because of a "huge philosophic divide in this Legislature about the expansion of gambling."

Bush, Lee and House Speaker Allan Bense all said Wednesday they want to pass legislation. But no one showed any willingness to budge.

Bush and Bense repeated their main reason for pushing bingo-style machines.

They say that by limiting Broward County's parimutuels to bingo-style machines, they can also stave off an expansion of gambling at Indian casinos. That position, however, is not supported by the federal Indian Gaming Regulatory Commission.

Senate sponsor Dennis Jones, R-Treasure Island, has suggested he would pull his industry-friendly bill before he would abandon his push for Vegas-style machines.

"Maybe we let a judge decide," Jones said. He was referring to comments parimutuel owners have made that if lawmakers fail to act this session that they will seek direction through the Florida courts.

"I have no doubt the court would agree that voters approved (Vegas-style) machines," Jones said.

The failure to pass legislation this session would be a huge setback for the seven parimutuels in Broward and Miami-Dade county that pushed the state constitutional amendment on November's ballot.

The amendment authorized slot machines at existing parimutuels in those counties, pending voter approval.

On March 8, the same day the current legislative session opened, Broward voters approved the idea; Miami-Dade rejected it.

The parimutuel industry clearly supports the Senate bill, but lobbyists declined Wednesday to criticize the House.

"Anything we may do will be dependent on the total package that passes," said Lori Weems, an attorney for the parimutuel-backed group that pushed the state constitutional amendment.

If the matter ultimately went to a judge, who ruled in favor of parimutuels, lawmakers still could return and raise tax rates or add additional regulations.

"We prefer to have a bill, no doubt about it," said Fred Havenick, CEO of Flagler Dog Track in Miami. "If we have to I suspect we'll go to court July 1, but we're hopeful that won't happen."

Lee said it is possible no bill will pass until the governor leaves office in January of 2007.

"The dynamic is that antigaming interests can stake out a very conservative position on legislation - high taxation and high levels of regulation and limited hours of operation - and if the industry doesn't budge they can stall the process," Lee said. "It's so much easier to kill a bill in this town than to pass it."

Bense said the House wanted to pass a bill.

"We've got a week or so to go; I'd like to get it resolved," he said.

But the conflicting views of how to implement constitutional Amendment 4 have shadowed the 2005 session from the beginning.

The day after the Broward election, Bush suggested the parimutuels might not get what they wanted.

Since then, Bush and the House leadership have pushed for Class II gambling, a federal classification for games such as bingo or poker in which players compete against one another and the house takes a portion of the amount wagered.

Class III games such as blackjack, roulette or Vegas-style slot machines pit the player against the casino, sometimes for huge jackpots. Class III games also are more profitable for casinos because they can set the payouts, subject to law.

Parimutuels and the Indian tribes contend the constitutional amendment voters approved in November refers to Class III machines.

Bush and the House say otherwise.

Under federal Indian gaming law, tribes are entitled to offer any kind of gambling allowed elsewhere in the state - though federal law requires tribes to negotiate a compact with a state before implementing any Class III gaming.

Bush has contended if the House limited parimutuels to Class II machines, it might be able to stave off any gambling expansion by the Miccosukee and Seminole Indian tribes, which have already formally requested to begin negotiations.

Bush stopped short Wednesday of threatening to veto a bill that included Vegas-style machines, suggesting he might be willing to embrace a compromise if lawmakers can find one.

"I'm keeping my options open," Bush said. "Whatever we do with the parimutuels is the floor from which we start negotiating with the Indians."

[Last modified April 28, 2005, 01:19:11]