Florida Sports Betting Decision Looms with Nationwide Consequences

Florida Sports Betting Decision Looms with Nationwide Consequences article feature image

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Federal officials will rule on a groundbreaking sports betting deal in the coming days, potentially opening the nation’s largest legal online wagering market.

The Seminole Tribe of Florida and the state’s elected officials struck a gaming compact deal earlier this year that will permit the tribe to open retail and online sportsbooks. By law, all such agreements are subject to the federal Department of the Interior’s approval.

Though most gaming analysts and legal experts believe the compact’s retail gaming provisions, including craps, roulette and brick-and-mortar sportsbook authorizations, will pass legal muster, the online aspects appear to run afoul federal law. Florida officials have argued the deal fits under current federal law, but critics believe it violates provisions that limit gaming to “tribal lands” and cite multiple court decisions that have prohibited tribes from offering online betting options.

Tribes in Arizona, Michigan and Connecticut have been permitted online sportsbook licenses because they agreed to their respective state’s regulations. They are taxed and regulated similarly to commercial gaming entities.

The Seminole deal seeks to be the nation’s first compact that permits off-tribal land gaming under the federal Indian Gaming Regulatory Act, the sweeping legislation that regulates tribal gaming nationwide. The compact language also would permit certain aspects, such as the brick-and-mortar sportsbooks, to stand even if online components are denied.

The Interior Department formally received the compact June 21, giving officials 45 calendar days to affirm, deny or take no action on the compact. The much-anticipated ruling becomes official when it’s published in the Federal Register, which is expected in the coming days.

In any scenario, Florida policymakers and the Seminole tribe agreed to delay sports betting until at least Oct. 15.

In the meantime, the following is at stake for the American gaming industry:

Largest Market

If online sports betting is approved, Florida would eclipse Pennsylvania as the nation’s most-populated legal digital wagering state. With California and Texas unlikely to approve mobile sports betting until 2025 or later, it’s a title the Sunshine State should hold for years to come.

Along with more than 21-million residents, Florida averages more than 100 million tourism visits annually. Mobile wagering from Pensacola to Key West could create a market that reverberates beyond just the state itself.

Other Tribes

Mobile sports betting authorization for the Seminoles could mean hundreds of other tribes could pursue digital gaming options of their own. Legal battles would surely follow, but an internet-friendly definition of wagering “on tribal lands” could mean every state with a recognized tribe has at least an argument for digital sportsbooks, lottery and casinos.

Retail Betting

Retail sportsbooks at the Seminole’s casinos in Tampa, Hollywood and five other locations are expected to be approved. In-person betting typically makes up less than 15 percent of betting handle in states with both options, but the first legal betting options are at least newsworthy in such a heavily populated and visited state.

Other Betting Options

The compact also includes provisions that allow the Seminoles, state pari-mutuel operators and third-party sportsbooks to partner for additional sports wagering options with revenues split between the groups. Any mobile or online provisions of this agreement could also be disallowed by federal authorities.

Seminole Gaming officials said top sportsbooks including DraftKings, FanDuel, BetMGM and Barstool Sports have inquired about such a deal, but it remains to be seen if any party would be interested; not coincidently, DraftKings and FanDuel are pushing a separate ballot measure that would give them mobile sports betting access independent of the tribe.

Legal Battles

A pari-mutuel operator has already filed suit and anti-casino groups have indicated they will pursue legal challenges as well. Any compact ruling could create a myriad of legal challenges that may not be settled for years.

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