Smart Rules Mean Best Payoff from Florida Resort Casinos

The Florida legislature has two bills (SB 710 and HB 487) that contemplate destination resort style gambling and a gaming commission.  Completely predictable are the arguments in support (jobs and taxes) and in opposition (morality, fairness to other entertainment venues ).  Florida already has a gaming industry; statewide lottery, 18 racetracks and 5 casinos in Florida’s southern half.

In this high-roller game, the legislature is cast as pit boss setting rules for three players.  The destination casinos face a buy-in obligation of $2 billion construction per site and 10% business tax in return for a gaming tables and slots franchise.  The pari-mutuel operators hold racing and slots franchises for a 35% business tax but now want gaming tables and tax rate parity with the proposed resort casinos.  The Seminoles hold long-term slots and 5 year gaming tables exclusive franchises outside Miami-Dade.  The legislature must devise rules of play that yield the best result for Florida.

Lacking a personal income tax, Florida will harvest any reasonable business tax on offer.   Unsubsidized, new jobs are the gold standard of political success and Casino construction will create 40,000 to 117,000 direct, indirect and induced jobs.  Longer term, casino operations will employ thousands in the restaurants, bars, casino floors and hotels.  Floridians will be patrons but a big influx of tourist dollars is also expected.

To design the rules of play, taxes and jobs at pari-mutuel and Seminole venues will need to be re-estimated (identify real expectations, not “promises”); Florida’s Seminole compact needs to be taken seriously; and the deal should front load any new deal so that Florida’s taxpayers are guaranteed to win.

The payoff is worth legislators’ attention and worth Tallahassee paying for independent advisors to pick the best casino rules for all Floridians, even those outside Miami-Dade and Broward.

Alan Daley is a retired businessman living in Florida.  He follows public policy from the consumer’s perspective

 

 

 

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