Seminole Indians hit the jackpot with controversial Florida gambling deal

The tribe, already a financial powerhouse, has signed a ‘historic compact’ with the state that will generate billions of dollars

By Craig Pittman, Washington Post, July 11, 2021

TAMPA — The cavernous Seminole Hard Rock Casino rocks around-the-clock with 5,000 noisy slot machines; a couple hundred poker, blackjack and baccarat tables; and superstar artifacts such as Elvis Presley’s gold piano. But gamblers who enter through the Lucky Street entrance pass first through a quiet, dimly lit hallway of black-and-white photos revealing who owns this shrine to blind luck.

The pictures portray life among Florida’s Seminole Indians — carving dugout canoes, living in thatch-roofed chickees. Some images date back more than a century, to a time when, according to a 1913 report to Congress, gambling was “unknown among them.”

Today, this tribe of about 4,300 controls six casinos in Florida and six more in other states, Canada and the Dominican Republic, not to mention a hotel and restaurant chain with locations in 70 countries. And it’s poised to take exclusive control of the largest legal sports betting operation in the country, thanks to a deal cut this spring with Gov. Ron DeSantis (R) and the legislature.

The arrangement will generate $6 billion for the state through 2030, DeSantis said in announcing the “historic compact.” The Seminoles are expected to also benefit handsomely, though they have not disclosed specific projections.

Critics such as Miami Beach Mayor Dan Gelber argue that the deal is a blatant move to circumvent federal law governing Indian gaming, not to mention a 2018 constitutional amendment requiring voter approval of any expansion of casino gambling — an amendment the Seminoles supported.

“The legislature and the governor seem to be doing backflips to avoid giving this to the voters,” Gelber said.

Lawsuits brought by a pair of pari-mutuel companies could yet derail the agreement, however, and Interior Secretary Deb Haaland, the first Native American to serve as a Cabinet secretary, must still review it. She can approve or reject it within 45 days; not acting will allow the compact to take effect.

For the moment, the tribe is riding high.

“There is no one else in the casino industry with that kind of global footprint,” said Jim Allen, chief executive of Seminole Gaming and chairman of the Seminole-owned Hard Rock International.

How did a tribe that once hid in the Everglades to avoid exile hit such a big jackpot?

“The through-line of this story is not gambling but their determination to preserve their culture and their way of life,” said Jessica R. Cattelino, a professor of anthropology at UCLA and the author of “High Stakes: Florida Seminole Gaming and Sovereignty.”

Thousands of Seminoles were living in scattered villages when Juan Ponce de León arrived in 1513 and claimed the territory for Spain. Over the ensuing centuries, many did not survive the diseases that came with explorers, while others were killed in attacks by settlers and the U.S. military. When Congress passed the Indian Removal Act of 1830, American troops captured most of the Seminoles to ship off to Oklahoma.

Those who escaped — no more than 200, said historian Dave Scheidecker, an archaeologist employed by the tribe — fled into the River of Grass, where they fended off soldiers in guerrilla wars. The tribe refers to itself as “the Unconquered People” because the Seminoles never signed a treaty of surrender.

Yet maintaining your freedom and making a living require different skills. Beginning in the early 1900s, members of the tribe adapted to become part of the burgeoning tourism industry, making crafts to sell as souvenirs and wrestling alligators as entertainment. Some got into cattle ranching, spurring jokes about Indians playing cowboy, but they made a success of it.

After Congress passed the 1953 Indian Termination Act, designed to dissolve and relocate any tribe without a binding legal treaty, the Seminoles fought back. They elected a tribal council and ratified a constitution in 1957 to win federal recognition as a sovereign nation — a country within a country. That meant they paid no taxes on the sale of items like cigarettes, enabling their stores to price them cheaper than nearby White-owned businesses.

By 1979, tribal elders decided to push the sovereign nation concept a little further and opened the nation’s first Native American high-stakes bingo hall. Their venue was a dumpy building on their reservation in Hollywood, near Fort Lauderdale. One tribal leader joked that if bingo didn’t pan out, they could convert it to a roller rink.

Local officials were outraged that the Seminoles were touting jackpots of $25,000, far larger than the state’s legal limit of $100. Then-Sheriff Bob Butterworth, a Democrat who would go on to become Florida’s attorney general, insisted that the tribe was not only breaking the law but was fronting for the mafia. When he lost a legal challenge, it opened the door for all the other Native American tribes nationwide to launch their own gambling businesses.

Fast-forward to the current empire, which is led by Marcellus Osceola Jr., the grandson of the tribe’s first chairman.

“Because of gaming, we’re able to keep educating our children. We’re able to provide medical services,” Osceola said in a brief statement issued in response to questions from The Washington Post. “And we’re building over 500 homes on six of the reservations to get tribal members back to the reservations.”

The National Indian Gaming Commission says 247 tribes operate 527 gaming operations across 29 states. Their gross gaming revenue totaled $34.6 billion in fiscal 2019.

Industry experts place the Seminoles among the top three tribes in terms of revenue, according to Nick Sortal, a former journalist who covered Florida gambling for a decade before being elected to the city council in Plantation. He views their embrace of new technology as key: Their casinos were among the first with slot machines that play bingo, giving customers the illusion of Vegas action while keeping within the letter of the law.

“That was a brilliant thing they did,” Sortal said. Slots appeal to a demographic he calls “the lonely abuela,” explaining, “You’ve got grandmas from Miami-Dade County playing $50 to $100 on the slot machines every day.”

Allen, who is not a tribal member, gets the credit for coming up with the idea for those machines with game manufacturers. He has spent virtually his entire career in casinos, starting as a cook at Bally’s in Atlantic City, then working his way to the top, including a stint overseeing Donald Trump’s three Atlantic City properties.

The Seminoles hired him in 2001 (and then purchased Trump’s shuttered Taj Mahal casino in 2017). Five years in, Allen negotiated for them to buy the Hard Rock International chain for $965 million.

Federal law requires a tribe to negotiate with a state on any operations beyond poker and bingo. Then-Republican Gov. Charlie Crist agreed to a $1 billion deal to allow real slot machines, baccarat and blackjack at Seminole casinos in exchange for Florida sharing the revenue.

But the deal fell apart in 2019 because the Seminoles did not believe state officials were enforcing a ban on competitors in the pari-mutuel industry running similar games. They stopped paying the state $350 million a year.

The lost revenue gave DeSantis and legislative leaders a strong incentive to work out an agreement allowing the tribe to expand into the lucrative new field of smartphone-based sports betting.

Miami Beach’s mayor and other detractors contend the deal is an illegal workaround. Its provisions consider a bet made over a cellphone anywhere in the state to have been placed while on the tribe’s land in Hollywood, Fla., because that’s where the computer server is located. The strategy violates the Indian Gaming Regulatory Act, the Wire Act and the Unlawful Internet Gambling Enforcement Act, Gelber said in an interview.

“Casinos are a cancer on a community, damaging the local economy,” he said. “We’re not Las Vegas, where there’s nothing else to do.”

Despite the tribe’s wealth, the Seminoles make room for their culture, still gathering together for activities in their traditional clans. Their distinctive patchwork jackets “are almost like formalwear,” said Scheidecker, and while most tribal members in Florida now live in modern homes, almost all have chickees built behind or beside them.

Few Seminoles work in the casinos — no more than 100 out of Hard Rock’s 50,000 employees worldwide are tribal members, Allen said. Most instead gravitate to jobs in the tribal government or the tribe’s smoke shops or ranching and citrus operations.

“Because their focus is more on their family and culture, they prefer jobs that are more 9-to-5,” he said, “whereas our business tends to be 24 hours a day, 365 days a year.”

 

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