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Bits and Pieces from Indian Country - November 2007

1 December 2007

Florida is one of the first states to have Indian gaming – pre-IGRA Indian gaming. In those early days of the 1970s, that meant high stakes bingo. The tribes in Florida have been aggressive in pushing the envelope, but the governors of Florida have been just as aggressive in resisting the tribes' effort. As a result, with just two months left in 2007, the Florida tribes do not have a Class III compact with the State of Florida as the National Indian Gaming Act turns 19 years old.

But the two sides are closer than they have ever been. A new governor and federal threats have made the difference. The last governor, Jeb Bush, did everything within his power to keep the tribes from a compact; his successor, Charlie Crist, under the threat of a federally imposed compact, has promised to reach an agreement with the Seminoles for a compact. But as soon as the state and the tribe got close, the legislature and the state attorney general started taking aim at the process with the intent of controlling the outcome; some want to stop the compacts, some want higher "tax" contributions from the tribe and some just want the power of approval. Whatever their reasons, the legislature is threatening the process in a way that would have pleased Jeb Bush and his predecessors. In the meantime, the Seminoles just continue to expand and improve their casinos, just as they have also moved into the international business world with the purchase of the Hard Rock brand.

Right now, the casino brings in an estimated 10,000 people a day. That number is expected to double due to the project. The Hard Rock Hotel and Casino in Tampa is unveiling a 120-million dollar expansion project, making it the tribe's largest entertainment venture in the state. The project includes 1,000 new game machines, a video waterfall, and an upscale restaurant, Council Oak, is being unveiled this week. (Tampa Bay 10, 10-2-07)

Talks between Gov. Charlie Crist and the Seminole Tribe of Florida resume today over the expansion of casino-style gambling, but lawmakers are about to weigh in. Crist said he feels compelled to strike a deal to allow Class III gambling, including slot machines and black jack, in tribal casinos or risk losing hundreds of millions of dollars a year for the state. House budget chief Ray Sansom told reporters last week that his chamber would oppose any deal to expand gambling in Florida. House Speaker Marco Rubio has even asked for a nonbinding advisory opinion from Attorney General Bill McCollum stating that Crist's negotiations aren't necessary. The dispute is likely headed for court. (Jim Ash, Pensacola News Journal, 10-2-07)

As the Indian gaming debate simmers in Florida, there are significant issues to consider about expanding casino gambling throughout the state. With Las Vegas-style gambling prospects, citizens are raising concerns about public safety and consumer protection, and I share those concerns. The statistics are sobering. In communities that permit Class III casino gambling, such as Las Vegas-style slot machines, blackjack card games and even roulette or craps, the crime rate is nearly twice the national average. Additionally, statistics show that illegal gambling is significantly more prevalent in states that have opened the door to legalized gambling. A recent study found more than two-thirds of compulsive gamblers had engaged in criminal activity, including violent crimes, because of a gambling problem…Given the highly addictive force, the propensity for criminal activities and the possible adverse effects on our tourism industry, casino gambling could conceivably be a nightmare for Florida. (Bill McCollum [Florida Attorney General], Jacksonville Times-Union, 10-2-07)

The revenue at Foxwoods Casino in Connecticut may be declining, but it is still in the top five casinos in the world in size and revenues. It has also launched the tribe as a leader in helping other tribes get started in gaming, and it is a bidder for licenses in other jurisdictions. But there was a time when the tribe could not find anyone willing to lend them enough money to build any casino, much less what was to become the largest and most successful casino in the world. After asking 23 different institutions, and one suspects as many gaming companies, for help, they found it. Across the world one of the legendary Asian casino bosses, Tan Sri Lim Goh, came to look. The complications of Indian sovereignty, an untried location, and a seemingly unsophisticated tribe did not faze him. After just a few hours, he decided to lend the tribe $60 million. This month the tribe honored him in the wake of his death at 90. He was very well known and respected outside the United States, but even after his very smart investment in Connecticut – he got premium returns for the perceived risks of the venture – he is still virtually unknown here, except, of course, to the thankful members of the Mashantucket Pequot Tribe.

The late Tan Sri Lim Goh Tong's legacy does not only live on in Genting, but halfway round the world in the Native American tribe of the Mashantucket Pequot. Unknown to most Malaysians, in 1991 the late Goh Tong helped the tribe – that was struggling to grow cabbage – by investing in their idea of building a casino, the Foxwoods Resort & Casino, which has now become the largest casino in the world. The chairman of the Mashantucket Pequot Tribal Nation, a sovereign nation within the US located in the state of Connecticut, Michael Thomas said the tribe owed a great deal to Lim for his vision and his confidence in them…As a result of a meeting with the business partner of Tan Sri Lim Kok Thay, Nicky Brown, Thomas and his tribe were introduced to the late Goh Tong who turned out to be the only one who would help them. "He heard about our situation and actually came to our place to meet our people and see for himself what we were about and what our values were," he said after meeting with Lim's family for over two hours at the wake yesterday. "Within 48 hours of meeting us, he agreed to give his support in the form of a US $60mil investment," he said. (Malaysian Star, 10-29-07)

It is a full year before the presidential election and for the first time within my memory, casino gaming is part of the debate. Unions, and possibly even taxes, have attracted the Democratic candidates; we will just have to wait and watch to see if the Republicans join the fray. In Congress, a national poker organization is lobbying to overturn the anti-Internet gaming law, and there are now 40 senators signed to sponsor a bill to make Internet gaming legal. In the meantime, we will have the debates in Maryland and Massachusetts to watch. Ohio, California, Maine, and Florida may also vote on gaming before then, and the outcome of those votes may also influence the national debate. All we can do is watch and hope that the need for taxes or the excitement over bidding for licenses does not creep into the national political dialogue. Of course, even if it did, the states themselves would fight tooth and nail to keep the federal government out of their tax pockets. But if we have learned one thing from the bill banning Internet gaming, it is that one or two anti-gaming senators willing to introduce a new bill every year, year after year, may eventually succeed. The proposition of an additional layer of regulation and taxation is more frightening than any costume you saw this or any other Halloween.

But now, that is simply my opinion, isn't it?

Ken

Ken Adams

Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.

Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.

Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.
Ken Adams
Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.

Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.

Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.