Loopholes in Florida Law? Really?

Florida gambling law filled with barrel-sized loopholes 

Florida’s gambling laws, thanks in part to special interest influence, are a hodgepodge that savvy attorneys have learned to exploit.

 

Angela Harrison helps her horse "Colors Runaway King" to hit the brakes as they near a barrel on Thursday. Barrel racers took to the racing arenas at the Gretna racing venue on Thursday, December 1, 2011. Visitors got to bet on the results for the first time.
Angela Harrison helps her horse “Colors Runaway King” to hit the brakes as they near a barrel on Thursday. Barrel racers took to the racing arenas at the Gretna racing venue on Thursday, December 1, 2011. Visitors got to bet on the results for the first time.

Mike Ewen

BY MICHAEL VASQUEZ

As Florida considers ushering in a new era of casino mega-resorts, a dispute in the tiny Panhandle town of Gretna has focused attention on the state’s existing gambling landscape — and the considerable confusion that surrounds it.

Florida’s current gambling laws, some say, are so haphazard, so disjointed, that no one can even agree on what the term “horse racing” means anymore.

If you’re thinking of the Kentucky Derby, think again. Gretna’s new Creek Entertainment barrel racing facility — which also will offer poker and hopes to add slots — has just opened, despite fervent opposition from the state’s horse trainers and breeders. Instead of racing around an oval track, these horses zig-zag around red barrels, rodeo-style.

The owners of Creek Entertainment — which include a savvy Gulfstream Park lobbyist who once tried to install slots at Miami International Airport — say the particulars of how the horses are running don’t matter. Florida’s Department of Business and Professional Regulation has agreed, and signed off on barrel racing as fully compliant with Creek Entertainment’s quarter horse racing permits.

By opting for unconventional barrel races, Creek Entertainment is poised to reap all the rewards of running a horse track, while avoiding the typical requirement of sharing profits with the horsemen.

“This is nothing more than a get-rich-quick scheme,” said Kent Stirling, executive director of the Florida Horsemen’s Benevolent and Protective Association. “When this gets to court, they’re going to have a lot of questions to answer.”

Stirling and other horsemen will soon argue their case before an administrative law judge, and the legal tussle will likely continue after that. Attorney Marc Dunbar, a Gulfstream Park lobbyist with an ownership stake in Creek Entertainment, says the dispute over his new track boils down to greedy horsemen who are unwilling to share racing purses with barrel racing riders. As for the notion that barrel racing isn’t true horse racing, Dunbar is incredulous.

“First of all, why is it called barrel racing?” Dunbar asked.

Of late, Dunbar has not only had to justify barrel racing, but he’s also been put on the defensive by accusations that influence-peddling played a role in the state approval of his racetrack. When Jim Barnes, a former investigator with the state’s Division of Pari-Mutuel Wagering, retired last month, his farewell email to colleagues said he was joining the “dark side” and taking a job as head of security at the new barrel racing track. Dunbar insists that Barnes has not been hired and never even filled out an application.

When reached by a reporter, Barnes’ only comment was, “I really hope you don’t screw up my retirement job.”

HORSES, JAI ALAI

These days, as horse racing fades in popularity but slot machines and poker generate huge profits, horse racing permits can be lucrative not because of the actual races but because, under Florida law, running horses entitles the permit holder to offer poker and sometimes slots. The same is true of jai-alai permits, which can allow casinos so long as the permit holder stages an even-less-popular gambling sport that features acrobatic men bouncing a ball off a wall.

The owners of Miami’s Flagler Dog Track/Magic City Casino recently obtained a summer jai-alai permit using a 30-year-old loophole in state gambling laws. The new permit allows construction of a casino/jai-alai fronton anywhere in Miami-Dade County. Even if no one shows up to bet on jai-alai, the casino could post a heavy profit through poker and slots. For now, Flagler’s owners have yet to unveil any concrete plans for what they might do with the new permit.

In Broward, influential developer Ron Bergeron is pursuing a jai-alai permit, with the possibility of building a facility in Weston. Bergeron’s attorney in that jai-alai bid is David Romanik, a Florida gambling law expert who also has a stake in Gretna’s barrel racing operation. The state’s gambling laws, he said, are the result of decades of lobbyist influence — a dog track or horse track, looking to boost the bottom line, will persuade a lawmaker to insert a beneficial clause or two.

The frequent goal, Romanik said, is to reward just one particular company, but writing specialized laws like that is unconstitutional. So the law is broadened just a touch, making it conceivable, but perhaps unlikely, that the new law could apply to someone else.

But that kind of legal wording can lead to legal loopholes big enough for attorneys in the know to exploit later on, Romanik said.

“The statutes are published, so they’re available for anyone to read,” Romanik said. But, he added, “I think you have to have specialized knowledge to be able to connect the dots.”

LEGISLATION

The notion of insider attorneys driving Florida’s gambling policy strikes state Sen. Ellyn Bogdanoff as all wrong. Bogdanoff, a Fort Lauderdale Republican, is sponsoring a bill in the Legislature this year that would allow three large-scale “destination” casinos to open in South Florida. Though disagreements over the wisdom of allowing more casinos has dominated the public debate so far, Bogdanoff’s bill would also set up a statewide gaming commission that could, in theory, replace Florida’s hodgepodge of gambling laws with clear, understandable rules of the road.

The current slew of loophole-exploiting gambling proposals proves a legal overhaul is necessary, Bogdanoff told a gathering of Broward business leaders recently.

“I couldn’t have written the script better myself,” Bogdanoff said.

Why can’t Florida’s gambling guidelines be updated without approving new casinos? Bogdanoff says she’s tried a stand-alone regulation bill in the past and it got nowhere in the Legislature. But this time, the three casinos’ provision could end up killing the bill as well. Some opponents of destination casinos, including the Florida Family Council and Hallandale Beach’s Mardi Gras Casino, say they would welcome a cleanup of Florida’s gambling rules if it was proposed on its own. But joined with new casinos, they’re fighting hard to stop Bogdanoff’s effort.

“Somebody needs to go through all the gambling statutes in the state,” acknowledged Dan Adkins, vice president of Mardi Gras’ parent company. “Say what’s legal, remove the gray, what’s not legal, and here are the rules.”

Miami Herald Staff Writer Mary Ellen Klas contributed to this report.

Read more: http://www.miamiherald.com/2011/12/05/v-fullstory/2527534/florida-gambling-law-filled-with.html#ixzz1fnI8TTsm

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