While many people around the country can watch college athletes make money off their name, image and likeness for the first time, and within NCAA rules, another new law went into effect on July 1.
This new law could have significant implications for the petition to bring a constitutional amendment to Florida and provide for a more competitive sports betting market.
What law is coming into effect?
As part of this year’s legislative session, while Gov. Ron DeSantis and the Seminole Tribe agreed on a new 30-year gaming compact, the Florida legislature passed a bill that would cap contributions to political committees sponsoring ballot initiatives in the State.
The bill, SB 1890, was signed into law by DeSantis. However, many see it as likely to have a crippling effect on the ability of citizen initiatives to gather the necessary signatures to get constitutional amendments on the ballot.
According to the Tampa Bay Times, legislators included a provision whereby the $3,000 cap disappears, but only when a ballot initiative receives enough signatures to make it onto a ballot.
For the 2022 election cycle, that will mean collecting nearly 900,000 signatures before individuals can exceed the $3,000 cap.
According to Rep. Bobby Payne, quoted in the Tampa Bay Times story, the law is intended to stop out-of-state millionaires and billionaires from financing ballot initiatives in the Sunshine State. Though Payne did recognize the bill may also limit the capacity to raise signatures from Florida residents.
Is something off? The ACLU thinks so
Not everyone, however, thinks that the law is a good idea or legal. For example, the American Civil Liberties Union (ACLU) filed suit in federal court shortly after the law was passed, arguing that the law violates freedom of speech and association allowed via the First Amendment.
The ACLU argues that Florida voters approved the procedure for citizen-led constitutional amendments back in 1968. That has led to 32 occurrences of successful execution.
The lawsuit details a long history of efforts, back to the provision’s origins, to add qualifications to the signature-gathering process.
The decades of burdens placed on signature collections have made the process of gathering signatures increasingly expensive and challenging.
The First Amendment strongly protects political speech, and the Supreme Court has ruled that political contributions are a protected type of political speech.
Florida ballot initiative affected by new law
The $3,000 limit on contributions takes effect just about a week after news that DraftKings and FanDuel had combined forces to back a political committee known as the Florida Education Champions (FEC) to fund a campaign for a constitutional amendment.
The initiative would effectively undo the key aspect of the recently ratified compact: tribal exclusivity over FL sports betting.
The summary of the ballot initiative says:
“Authorizes sports and event betting under Florida law at professional sports venues and pari-mutuel facilities and statewide via online sports betting platforms by entities authorized to conduct online sports betting, and by Native American tribes with a Florida gaming compact, only for persons 21 years and older.”
If — a very large if — the FEC succeeds in gathering the roughly 890,000 signatures necessary to get the measure on the 2022 ballot, and if they can get 60% of voters in November 2022 to vote in favor of the initiative, some potentially serious consequences could emerge for the new multi-billion dollar compact between the Seminole Tribe and the State.
What will be the impact on the new compact?
In Part XII of the new compact, the issue of exclusivity is addressed. Notably, what happens if the Seminole Tribe loses exclusivity and what that means for payments to the state.
“If, after January 1, 2021, Florida law is amended by … an amendment adopted to the Florida Constitution to allow (1) the operation of Class III Gaming … at any location under the jurisdiction of the State that was not in operation as of January 1, 2021…the payments due to the State…shall cease….”
Breach of the exclusivity provisions by an approved constitutional amendment could result in the tribe suspending their proposed $500 million in annual payments to the state.
Revenue projections for what a competitive market would generate are challenging to estimate without a tax rate or other considerations. But even the most bullish estimates would not likely estimate a commercial regulatory scheme generating $500 million annually in Florida.
The currently pending compact awaits approval by the US Department of the Interior. And substantial questions remain about whether the compact, in its current form, will receive the sign-off. A non-approval or lawsuit could see the state and the Seminole Tribe go back to the drawing board.
What to keep an eye on now
The $3,000 limit placed on donations is sure to impact all varieties of ballot initiatives.
As of the time of writing, the Florida Education Champions show $0 in campaign finance activity. That could indicate they missed the July 1 deadline to build a generous fund to begin the signature collection process. But, it could also mean there is a lag in things showing up on the state’s website.
Florida sports betting has a lot of moving parts right now. First are questions about the validity of parts of the new compact.
But second is whether the FEC can get enough signatures to reach the ballot in just over 16 months. Gathering nearly 900,000 is a monumental task even for well-financed operations. And the new law may significantly hamstring signature gathering.
Additionally, even if the ACLU is successful in arguing that the new law violates the First Amendment, time is precious for the Florida Education Champions. And the FEC already faces incredibly long odds.