All Sheldon Adelson‘s horses and all Sheldon Adelson’s men couldn’t put Texas megaresorts together. Or, as they said in Brooklyn (in a non-gaming context), wait ’til next year. Two separate bills to authorize everything from full-service casinos to poker rooms died in committee without even getting so much as a vote. The late Adelson put all his eggs in the Texas GOP basket and the party failed to show much gratitude, as the dismal performance of gaming legislation evinces. At least the lower house’s version of the bill got a hearing. No such luck in the state Senate. Even had the Lege gotten its act together, the casino push was an uphill slog, facing an increasingly likely veto from Gov. Greg Abbott (R), never mind the need to obtain a two-thirds supermajority at the 2022 ballot box, had Abbott reversed field. Polling showed majority approval but fell well short of 66%.
Despite the Lege’s truly dismal performance, Las Vegas Sands‘ man in Austin, Andy Abboud, remained optimistic, blowing sunshine up solons’ asses. “We have said from the beginning that we’re committed to Texas for the long haul. We have made great strides this session and have enjoyed meeting with lawmakers about our vision for destination resorts and answering all the questions they have.” Given the short shrift he got from lawmakers, we’re not so sure about Abboud making any “great strides,” and the deployment of literally scores of lobbyists, led by Karen Rove, yielded so little progress that it has to be chalked up as a giant flop. Losers other than Sands included Golden Nugget owner Tilman Fertitta and several Native American tribes who would have qualified for Class III casinos. It’s difficult to scavenge much upside from this result and Abboud might want to think about making some friends on the Democratic side of the aisle. The Texas GOP is so casino-averse that Abboud was ultimately spitting into the wind.
Better news was to be had from Louisiana, where the state Senate approved a 40-skin sports betting package with the goal of getting the infrastructure in place by NFL season. “Wagers will be able to placed on smart phones, in casinos, at kiosks in bars and restaurants that serve liquor,” starting July 1. So eager were senators to get the action going that they approved an amendment allowing casinos to operate makeshift books while the permanent ones are being built. There were six naysayers but the definitive word came from Sen. Ronnie Johns (R), who dropped the boom by saying “The vote on this bill was actually taken last fall when 65% of the people said we want this.” As presently constituted, the legislation gives operators until January of next year to get their applications filed. They’ll have to pony up $250,000 for the initial OK and another $500,000 for the first five years of operation.
Brick-and-mortar casinos are juiced into 20 licenses. Each license allows for two platforms, so there will be plenty of room for everybody in the OSB universe. An additional license goes to the Louisiana Lottery, although it will not get to choose who its online partner is. Retail bets are taxed at 10% and online ones at 15%—the Lege knew where the real money is to be found. Of course, nobody knows how much tax money will be generated, which complicates its allocation—probably to help schools and disabled children. Kudos to Louisiana senators for doing the right thing.
Maryland Gov. Larry Hogan‘s right arm must be pretty tired this week. He’s signed 200 (!) bills into law. But the one that counts from our perspective was the legalization and regulation of sports betting in the Free State. It’s almost certainly the most wide-open such bill enacted into U.S. law. It provides “Class A” licenses for casinos, horse tracks and sports venues, as well as 30-plus “Class B” licenses for non-gaming businesses. The tax rate is a flat 15%. There will be 40 OSB skins but walk-up wagering is expected to incept first. MGM National Harbor, Maryland Live and Horseshoe Baltimore get to go the head of the queue when it comes to licensing. Online betting, some say, may not be available until next year—not surprising given the scrum of applicants Maryland can expect. Heck, the application commission has yet to be formed. Class B license awards will be weighted toward businesses with significant female or minority ownership. Unlike Louisiana, which anticipates $50 million in tax revenue from sports betting, Maryland’s goal is more modest (and, dare we say, realistic): $15 million-$20 million/year.
We’ve spilled so much ink on Florida Gov. Ron DeSantis‘ Christmas tree of a gaming compact that at first it seems there’s little else to mention other than it passed overwhelmingly and speedily out of the Lege—not without some vigorous arm-twisting by DeSantis of legislative Debbie Downers. However, lawmakers found time to add one more bauble in the form of a juice job for Donald Trump. The cronyism involved is so transparent as to be hilarious: A 15-mile radius of exclusivity will be drawn around existing Broward County casinos. It just so happens that Trump’s struggling Doral golf club (a proposed casino site) sits just a stone’s throw beyond 15 miles from the Seminole Tribe‘s Hollywood casino (you know, the one with the guitar-shaped hotel). But if Jeffrey Soffer is going to get special permission to move a gaming license to Miami Beach, why leave the Trumpster out of the fun? Former governor Jeb Bush pouted that “now is not the time” to expand gambling in the Sunshine State … but Bush has never thought there was a right time to do it, giving his comments a hollow ring.
Passage of the compacts was a lead-pipe cinch. Getting it through the courts will be anything but. The Florida constitution bars the Legislature from authorizing new casinos (including tribal ones) or new forms of gaming, both of which are in the DeSantis compact. Sports betting falls into a gray area, depending on whether the judiciary ultimately deems it “casino gaming” and thus illegitimate or something brand-new and constitutionally kosher. Disney may have committed a major oversight when it failed to foresee sports betting, as they drafted the constitutional provision (Amendment 3) that could be DeSantis’ undoing.
In other words, sports betting might sneak through if it’s not deemed Class III gaming. (Others disagree, citing the byzantine hub-and-spoke model whereby the Seminoles control sports betting.) The other stuff, not so much.
Or, as the Orlando Sentinel editorialized, “Constitution? What constitution?” Even one proponent had said, “Personally, I don’t think it’s going to survive [a court challenge],” a remark the Sentinel quickly observed. 71.5% of Floridians voted for the Lege to butt out of gaming expansions, so ineffectual had it been until now. The Sentinel called the ratification of the DeSantis compact “an astonishing display of bipartisan disregard for the will of Florida’s voters.”
One casualty of the solons’ ratification of the compact was i-gaming, essentially permitted in a one-page addendum stuck onto the tail end of the pact. “Some language in the Compact could be construed to lead to the backdoor expansion of online gaming,” House Speaker Chris Sprowls (R) said. “Even the mere possibility of this was unacceptable.” Added state Rep. Randy Fine (R), a former gaming exec, “People were not comfortable with agreeing to online sports machines from your couch. As Sheldon Adelson used to say, he liked you have to put on a pair of pants to go gamble.”
Don’t go to a Seminole casino this weekend hoping to find craps and roulette. The compact now moves to the Department of the Interior, which has 45 days to say yea or nay. The main sticking point would be whether the extremely george revenue-sharing provision ($500 million/year for 30 years) is deemed fair to tribal interests or excessive, in which case it’s back to the drawing board. If it sails through, OSB debuts Oct. 15. Hard Rock International CEO Jim Allen figures that will cover $100 million of the half-billion commitment to the state, with new casino games covering the rest. (Unlike Louisiana lawmakers, their Florida counterparts wouldn’t commit to setting aside any Seminole bucks for schools or social services.) Parimutuels, meanwhile, can continue to offer designated player card games, formerly a sore point with the Seminoles.
A less-publicized but wholly laudable aspect of the special session was the creation of a state gaming commission, whose remit will include cracking down on the black-market slots that sap legitimate casino revenues. There could, however, be a revolving door between the Lege and the commission or, as one lawmaker asked, “Shouldn’t we have a little distance between the last PAC check and your next vote on the commission?” By and large, Democrats grudgingly went along with DeSantis. As state Sen. Jason Pizzo (D) put it, “the current posture that we are in right now shows that one side is very good at negotiating and the other has never made a payroll or signed the front of a paycheck.”
Jottings: Were there any doubt that New Jersey Gov. Phil Murphy (D) lacked a spine, Bloomberg just removed it. It’s reporting that the Garden State is going to reinstate smoking in Atlantic City‘s casinos, a shameful prostration at the feet of Big Gaming. Murphy is such a jellyfish we can’t even feign surprise … Predictably, Urban One beat out Cordish Cos. to be the designated candidate for a Richmond casino. Cordish took it with good grace and the issue now goes to a November vote. In Urban One’s favor was lukewarm political support and a lack of neighborhood opposition, which couldn’t be said for Cordish, less so for Bally Corp., doomed by a poor site selection … Buffets are hesitantly returning on the Las Vegas Strip. The latest entrant, as of May 26, will be MGM Grand Buffet, which will apparently be doing business in pre-Covid style. We’ll pass, thank you.
The initiative process is ripe for abuse by powerful monied interests that manipulate the language and on purpose deceive voters in my opinion… Here in California you sometimes need a PHD to understand if your no vote means yes, or vice versa. In Florida irony has struck, no doubt that 2018 Initiative was pushed through by social conservatives trying to control gambling expansion, and it has ended up handcuffing the dictatorial right wing Governor who is trying to throw bones to his backers… In 2022 we Californians will have to vote to decide about handing out a monopoly on sports betting to the tribes, to the detriment of the card clubs that do not have the resources to create and nurture these often confusing creatures of the political processes…