Lawmakers in Florida have agreed to legalize sports betting. But speedbumps and roadblocks could lie ahead for the launch of legal sports wagering in the state.
Within a span of just a few weeks in spring 2021, Gov. Ron DeSantis signed a compact agreement with the Seminole Tribe of Florida, setting up a special legislative session that ultimately ended in lawmakers ratifying the compact and sending it along for federal approval.
During that short time, the legalization of sports betting in the Sunshine State went from seeming like a longshot to even become a reality to possibly being on the verge of legalization.
That said, even with the compact on the desk of the US Department of the Interior, its approval does not mean regulated wagering will automatically be on its way to Florida.
Questions surrounding the legality of the compact have heated up recently, specifically how parts of the compact might violate Amendment 3, which was passed in 2018 and requires voter approval for gaming expansion off tribal lands. Such an argument derives from the compact authorizing the Seminole Tribe to offer mobile wagering in partnership with pari-mutuel facilities.
While the agreed-upon compact specifies an Oct. 15 launch of sports betting in Florida, the road to legal wagering in the state could be a long one.
Florida offers plenty of gambling opportunities, including horse betting, a state lottery, poker rooms and tribal casinos. However, for now, the state doesn’t feature legal sports betting.
To change that, lawmakers needed to come to terms on a renegotiated compact with the Seminole Tribe, which runs seven casinos in the state. Even starting those conversations was a success, as the tribe has had a complicated and rocky relationship with the Florida government over the years.
Florida sports betting would undoubtedly be a lucrative endeavor. The Sunshine State houses a population of over 21.5 million people and a $1 trillion economy that sits as the fourth-biggest in the US.
Sports betting con artist Randy Craig Levine pleaded guilty to wire fraud and perjury charges after nearly 15 years on the run.
The Oct. 15 launch date for Florida sports betting is in jeopardy after a second legal challenge to the Seminole gaming compact.
While there’s no guarantee that regulated wagering will reach Florida in time for the 2021 football season, the wheels are certainly in motion for the industry to arrive at some point.
DeSantis signed off on his renegotiated compact with the Seminole Tribe in April 2021, which was essential if Florida wanted to integrate legal sports betting. With the Seminole in agreement, the outlook for legal sportsbooks in Florida becomes rosier.
The most optimistic timeline is for wagering to begin by October 2021, which would include retail sportsbooks on tribal lands and statewide online betting.
During a special legislative session in May, lawmakers ratified the renewed compact, sending the 30-year agreement to the US Department of Interior for approval. Before Florida can launch regulated sports betting, the federal government must approve the agreement, which could happen as soon as July 2021 as it has up to 45 days after receiving the compact to make a decision.
Even if it does sign off on the deal, that does not mean the path to legal wagering is clear of hurdles.
Lawmakers in Florida expect the compact to be challenged in court, which could stall the launch of regulated wagering even further.
Those who opposed the compact would likely based arguments around Amendment 3. This constitution amendment, passed in 2018, requires any casino gambling expansion in Florida off tribal lands to be approved by voters. What’s more, the Indian Gaming Regulatory Act only allows compacts to permit gaming on tribal lands.
The agreement between the state and the Seminole authorized mobile wagering via pari-mutuel facilities located outside of tribal land. However, the tribe has indicated it will house servers on its land. An answer would need to be provided to the question of where exactly is the location of an online wager: where servers sit or where bettors place their wager?
The federal government could choose to strip online sports betting from the compact. Or a judge could do so at a later time. If mobile betting does not survive, the Seminole will at least have retail sports betting authorized on tribal land while paying a minimum of $400 million a year to the state of Florida.
Why is it legal sports betting in Florida more realistic now than ever before? Because the Seminole Tribe is on board, a crucial element to gaming expansion in the state. The relationship between the tribe and Sunshine State had been strained, at best, in recent years.
In 2016, for example, Florida allowed pari-mutuel facilities to offer card games similar to what the Seminole Tribe offered at its casinos. Although the deal allowing the tribe to offer these games expired a year earlier, and with Florida wanting the tribe to stop offering them, a federal judge in 2016 ruled that the Seminole could keep those games.
From there, the relationship continued to turn sour. In 2019, the Seminole Tribe hand-delivered a letter to DeSantis that said it would stop making $350 million annual payments to the state amid the dispute over multiplayer games.
Lawmakers in the state had attempted to propose and advance legislation to green-light legal sports betting in recent years. Each effort, though, fell short as each attempt excluded the involvement of the Seminole Tribe.
Since 2019, when he took office, DeSantis and lawmakers have worked on a renegotiated compact with the Seminole. After two years, both the state and the tribe finally came to terms and began burying the hatchet, thus opening the door to Florida sports betting.
The agreed-upon and since-ratified compact, which also allows for the Seminole to offer craps and roulette at its casinos, sets up both retail wagering on tribal lands and statewide mobile betting via a hub-and-spoke model with servers located on tribal lands.
The Seminole would partner with at least three pari-mutuel facilities to allow those properties to access the online wagering platform using their own brands. Pari-mutuels would receive no less than 60% of revenue generated by those individualized skins.
Legislators also passed a bill to create an independent, five-member Florida Gaming Control Commission, which would actually have no authority over sports betting. As the industry would run through the tribe, the Seminole Tribal Gaming Commission would regulate it.
The newly created Gaming Control Commission would oversee pari-mutuel gaming while also serving as a state compliance agency aiming to shut down illegal online and physical gaming activity in the state. In addition, the committee would make sure the state does not breach the tribal compact again.
Should legal sports betting go live in Florida as it’s detailed in the renegotiated compact, the industry could essentially be a one-horse town.
Yes, the Seminole would partner with pari-mutuels to offer statewide online wagering. Yes, those pari-mutuels would be able to put their own brands on those individual skins. However, each mobile betting app in Florida would run through the same platform provider.
And there’s little doubt that the Seminole would leverage the Hard Rock brand. In fact, both Seminole Gaming and Hard Rock International already have some of the groundwork completed.
In December 2020, the two parties announced the launch of Hard Rock Digital, billed as an interactive gaming and sports betting platform. At the time of the announcement, Jim Allen, chariman of Hard Rock International, noted that “Hard Rock Digital also intends to pursue strategic branding and distribution opportunities both within the US and globally.”
Couple that with the app’s description to “turn up the volume” on sports betting, and it becomes clear that this platform would be the basis of the Seminole’s sports betting pursuit.
However, there’s also a chance that the Seminole give up their exclusivity to sports betting in the state in exchange for lucrative revenue-sharing deal with one or more sportsbooks. DraftKings, FanDuel, BetMGM and Barstool would be among the suitors for such a relationship.