Like slot players watching reels spin, South Florida casino executives are holding their breath.
Horse track and dog tracks are waiting for the state to lower a 50-percent tax rate on slots, worried about increased competition and adapting to a down economy.
Casinos operated by the Seminole Tribe of Florida are stuck waiting on an agreement with the state that spells out whether they can have blackjack and other table games -- because they'd like to build hotels at their Coconut Creek and Immokalee casinos.
And all are angling for the Florida state legislature to listen to their arguments as a gambling compact is being negotiated.
But at least all of them were in the same room Tuesday for the Florida Gaming Summit at the Seminole Hard Rock Hotel & Casino in Hollywood.
Three horse track and dog track owners said they're losing money, and would be even if the economy hadn't tanked.
"If we were a stand-alone property, with no corporate structure, we wouldn't be here," Mardi Gras' Dan Adkins said. Gulfstream Casino & Racing and Isle Casino & Racing officials made similar comments.
"By any stretch, performance has been poor," said gambling industry analyst Adam Steinberg of Morgan Joseph and Co. For example, casinos operated by horse and dog tracks expected to make $350 to $500 per slot machine. The latest figure by the Division of Pari-Mutuel Wagering puts it a $124 per machine in September.
Steinberg said the projections were too high, because they couldn't compete with the Hard Rock.
"They knew coming in they were going against an 800-pound gorilla," he said.
Mardi Gras VP Dan Adkins suggested a lower tax could help the casinos work to develop tourism. The state will lower the slot tax to 35 percent, if the compact is approved. The legislature might discuss it at a special session in December.
"Florida is so primed for drawing outside dollars. It's what we need to be focused on," Adkins said. "If we could be a full casino [with blackjack and other games], people would take visiting us over, for example, Biloxi. Why not?"
Currently, more than 90 percent of his customers are locals, Adkins said, while New Orleans, for example, has about 65 percent locals and 35 percent tourists.
But analyst John Maxwell of Jefferies & Co. said: "It's going to be difficult to go beyond being a local casino. You don't have much capital to put in."
Adds Steinberg: "Florida gets a lot of tourism, but it's the wrong kind for gambling. It's families with kids." He noted that Disney, for example, would not take kindly to Florida being marketed as a gambling state.
Meanwhile Seminole gaming CEO James Allen said the Hollywood Hard Rock and the six other Florida casinos operated by the tribe would be hurt if parimutuels statewide added blackjack, as Adkins and others request.
The overall expansion of gaming stresses the market, Allen said, noting how more gambling in Pennyslvania has contributed to a free-fall in Atlantic City.
"The days people drive 2-3 hours to go to a casino are slowly diminishing," he said. Internet gambling also "is coming, and it's coming incredibly rapidly."
Allen said if the compact were approved giving the Seminoles exclusivity, Florida could receive $3 billion over 20 years from the tribe.
The parimutuels could produce $10 billion over the same period, said Isle of Capri Casinos CEO Virginia McDowell, launching the first of many grenades during a luncheon speech. The Isle in Pompano Beach is among her casinos.
"Despite participating in a process to design a legislative solution, the Tribe has now decided they still want more," she said. "The expansion of gambling on tribal land does little to benefit the citizens of Florida, as the tribe is not required to pay taxes. Not a dime."
Further complicating matters is the opening of Miami-Dade casinos. Flagler opened as the Magic City Casino last week and Calder Race Course, on the Broward-Dade line, will open in a couple of months.
"As it expands, are we just splitting more of a fixed pot?" Chris Jones of Telsey Advisory Group asked.
> Discuss this entry