Tribe Stops Annual $400m Payment to State of Florida

  • The Seminole tribe in Florida has an exclusivity agreement with the Florida state government
  • The agreement allows the tribe to exclusively offer card games
  • In return, the tribe makes revenue sharing payments to the state of nearly $400m annually
  • The compact has now expired and card rooms in the state are infringing on the tribe's exclusivity
  • As a result, the tribe has announced it will stop making the revenue sharing payments
State flag of Florida
The Seminole tribe in Florida will stop its revenue sharing payments of up to $400m annually.

History of revenue payments

Since 2010, the state of Florida and the Seminole Tribe have had an exclusivity agreement that gives the tribe the right to be the sole provider of table games in the state.

The tribe also has exclusive rights to offer slot machines in the state, with a couple of exceptions. Naturally, this is a mutually beneficial agreement as the state gets an annual revenue payment from the tribe. The payment usually ranges from $350m (£272.5m) to $400m (£311.4m). Since the agreement has been in place, the state has received over $2bn (£1.56bn), a significant portion of the state budget.

However, some of the key terms of the compact agreement expired in 2015. A makeshift agreement was reached by the previous Governor, Rick Scott. This temporary fix extended the tribe’s exclusivity, but it expires on May 31.

Current Governor Ron DeSantis has been skeptical about some of the attempts to create a renewal of this compact. He is not looking to rush into an agreement that he may regret at a later date. Now it looks as if the state’s revenue could be in jeopardy.

Tribe stops revenue sharing payments

The Seminole Tribe is taking a hard stance in negotiating for a new compact. They are stopping their revenue sharing payments to the state.

The tribe sent a letter to Governor DeSantis announcing plans to stop revenue sharing payments from their six casino operations in Florida.

Marcellus Osceola Jr., the chairman of the tribal council, wrote the letter. He said that they have had a good relationship with the state in recent years and they hope that they can come to an agreement and continue working together long into the future. However, the tribe does not believe that the state is fulfilling its end of the bargain.

It appears that the tribe is not happy with certain types of infringement onto their exclusive gaming rights. Certain card rooms in the state have “designated player” games. The tribe says that this violates its exclusive right to offer card games. The courts have sided with the tribe on this matter.

In the eyes of the tribe, the state is not properly fulfilling their promise to aggressively enforce the rights of the tribe through their compact.

What happens next?

The future is now uncertain because Florida’s legislative session has come to an end. This has been a common theme in recent years but, in previous years, the temporary compact was still in effect. Now there is no agreement in effect and the state will no longer receive the revenue sharing payments.

The governor plans to resume discussions on the issue during the summer. The tribe respects this decision, but the letter also says: “In the meantime, the Tribe will follow its agreement with the state and suspend its revenue share payments until the illegal banked card game issue is resolved.”

Due to the lack of progress on the issue, there was no provision in the state’s $91.1bn (£70.9bn) budget for the tribe’s revenue share payments. There has been no official requirement for the tribe to make these payments since March 31 but they contained to do so regardless until now.