Analysis: Does Florida Have Any Chance At Legalizing Sports Betting This Year?

Written By

Updated on

Florida sports betting

A new year has brought with it a small (really, infinitely small) glimmer of hope that Florida will be able to get sports betting done during this year’s legislative session.

Probably not, but still.

As Legal Sports Report reported at the end of December, Jeff Brandes, a state Senator from the Pinellas area, has plans to introduce a trio of bills that would legalize FL sports betting with a licensing fee of $100,000 and a 15% tax rate, virtually the same legislation he introduced last year.

When will we know if this goes anywhere?

The State of Florida has a Legislative Session that opens on March 2, 2021 and runs through March 30, 2021. If things do not get done during that window, there is the ability to extend the session with a three-fifths vote by each side of the state legislature, or the possibility of a special session.

The Florida Constitution allows for either the Governor or the President of the Senate jointly with the Speaker of the House to call for a special session. Special sessions are typically much shorter and much more focused than the regular legislative session.

Highlights of the Florida sports betting bills

As was flagged by LSR, there is little new in the first of the three bills from Brandes. SB 392 is largely the same as the bill introduced last year that went nowhere. There are three bills that will be introduced in the Senate.

SB 392

The leading bill is SB 392, which would enable Floridians over the age of 21 to place wagers on a wide variety of sporting events, excepting high school and youth sporting events.

The Florida Lottery would be tasked with establishing the rules for and regulating a sports betting industry in the Sunshine State.

The Lottery would bear the responsibility for licensing operators in a system that appears reminiscent of the operating structure being used in West Virginia and Tennessee.

Notably absent from Brandes’ bill are any sports league handouts, which have appeared with growing regularity. At present there is no official league data mandate and no integrity fee like that being proposed in New York.

SB 394

If SB 392 becomes law, SB 394 would set the tax rate for the bill. The proposed tax rate is 15% of “sums received from a sports pool, less only the total of all sums actually paid out as winnings to patrons, is 15 percent.”

The money received first covers administrative expenses and then goes towards the State’s Educational Enhancement Trust Fund.

SB 396

The final prong in Brandes’ trident of sports betting bills is SB 396, which sets out the licensing fees for applicants applying for licensing. The bill sets both the initial application fee and the renewal at $100,000. SB 392 establishes that operators will need to renew their licenses annually.

Why are there three bills?

The Florida Constitution provides that bills can only cover a single subject. This often results in a number of bills being filed together addressing different, but related subjects. The purpose is to avoid bills being stuffed with a bunch of funding for unrelated pet projects.

What to make of the bills themselves

The bills obviously take the route of planning to rely on consumer volume as the primary revenue generation method versus relying on the high-priced licenses and renewals, a model seen in places like Illinois. Despite these bills ticking a lot of boxes for sports bettors, they appear unlikely to gain very much traction.

Why are these bills unlikely to go anywhere?

This attempt to run sports betting through the State’s lottery is missing at least one crucial component: the Seminole Tribe of Florida. The Seminole Tribe of Florida is not only a gaming powerhouse but a political force.

The State’s contractual relationship with the Seminole Tribe provides that any new Class III gambling activity, with limited exceptions, would be included within the definition of covered games under the existing Compact.

The agreement between the State and the Tribe grants the Tribe substantial exclusivity over covered games.

Is there a way this works?

Sports betting is a Class III gaming activity. The Federal Register says this, and it seems to be regarded as a near-universal truth amongst gaming experts.

The 20-year compact that was signed in 2010 has already been the subject of extensive litigation, with the Seminole Tribe prevailing in the most recent dispute.

It is unclear how these bills would avoid the Compact. But whatever the theory is, it appears almost certain that any legislation that does not include the Seminole Tribe’s okay would result in lengthy litigation.

The theory of how this bill would function in the presence of the contractual relationship between the State and the Tribe is paramount, but not the only obstacle. There remains debate over whether a 2018 ballot measure prevents the state from offering sports betting without a ballot measure.

What about daily fantasy sports?

While these new bills appear to be friendly to the consumer, they do not include a measure to explicitly legalize daily fantasy sports. While many operators have continued to operate in Florida, the industry has existed under the shadow of a 1991 state Attorney General opinion that argued traditional fantasy sports violate Florida Statute 849.14.

While legalizing daily fantasy sports could conceivably face many of the same challenges as legalizing sports betting, given the move to sports betting nationwide, it would seem odd to not include fantasy sports within the group of bills being filed and clear up any remaining uncertainty.

To date, no bill mentioning fantasy sports has been filed in the Senate or the House this year.

How excited should Floridians be about these bills?

Floridians should not get too excited about the prospect of these bills bringing sports betting to the Sunshine State. But, any discussion of sports betting should be viewed favorably.

The most likely delivery vehicle for sports betting to Florida will be with the inclusion of the Seminole Tribe. Efforts that do not include the Tribe are problematic on a number of levels, but perhaps most visibly, they are likely to be litigated, which would likely delay any launch by months or even years.