Letter: Feds may not have approved new Seminole Compact

The nation’s top Indian gambling regulator last year told the Seminole Tribe of Florida that the federal government would be “hard-pressed” to approve its new blackjack agreement with the state.

The tribe on Tuesday disclosed the June 2016 letter from Paula L. Hart, director of the U.S. Department of Interior’s Office of Indian Gaming, as an attachment to its own letter this week to Gov. Rick Scott and legislative leaders. (The letters are here.)

Tribal Chairman Marcellus Osceola told the state that this year’s gambling legislation “neither would satisfy the requirements of federal law nor satisfy fundamental tribal concerns” and called them “not acceptable.”

The tribe’s concern was that it would be financially squeezed by the Legislature’s current proposals without getting enough in return. It offers blackjack at five of its seven casinos, including the Seminole Hard Rock Hotel and Casino Tampa.

The Hart letter also confirmed a warning that Barry Richard, the tribe’s outside counsel, gave three years ago.

In a March 2014 interview with the Tampa Tribune, he explained that the federal Indian Gaming Regulatory Act prohibited tribes from paying states more than the cost of gambling regulation.

The Interior Department later interpreted the law to mean that a tribe may give a cut to a state in return for exclusive rights to a game, but the amount a tribe pays has to be a “fair value” for the exclusivity it’s getting, he said. 

Richard told the newspaper the feds will reject a deal if they think a tribe is paying more than the deal is worth: “(Their) message has been, ‘don’t push us on this,’ ” he said.

Hart later echoed Richard’s position when she discussed last year’s gambling bills, saying their gambling expansion provisions “dilute” the renewed compact that granted the Seminoles exclusive rights to blackjack in return for $3 billion over seven years.

“We would be hard-pressed to envision a scenario where we could lawfully approve or otherwise allow a compact to go into effect that calls for increased revenue sharing and reductions in existing exclusivity,” she wrote.

Fast forward to this year, with bills that contain many of the same proposals as last year, including expanding the availability of slot machines and card games.

“The Senate bill would require the same higher payments … (and) would add numerous additional exceptions to the Tribe’s exclusivity while broadly expanding gaming in Florida,” Osceola told Scott, Senate President Joe Negron and House Speaker Richard Corcoran.

“The House bill is less objectionable in that it does not propose as many new exceptions,” but it too “proposes major increases in the Tribe’s payments … without providing the necessary additional value.”

Osceola concluded by saying he was still willing “to work out a mutually beneficial agreement.” The 2017 Legislative Session starts next Tuesday.