Thursday's announcement of the tribe's $965 million deal to acquire the Hard Rock Cafe restaurant and casino chain stands to generate new, international earning potential for the Seminoles, even as they cope with new gaming competition, and legal and tax challenges.
"It's been a phenomenally successful operation," said Joseph Weinert, vice president of Spectrum Gaming Group, a New Jersey-based gaming consultant who issued the 2006 earnings estimate. "Now, they'll have tremendous additional cross-marketing and promotional opportunities."
Such a glittering future likely seemed unimaginable in 1979, the year then-Seminole tribal chief James Billie opened the USA's first high-stakes Indian bingo hall in Florida.
The facility quickly became a success, prompting other Native American tribes to open gaming centers of their own.
Even before Thursday's deal, the Seminoles were among the top players in what is now a nearly $23 billion-a-year industry. The tribe owns and operates seven Florida casinos, including two Hard Rock gaming-hotel-restaurant facilities in Tampa and Hollywood.
Although gaming industry analysts say the tribe's Florida facilities have been successful, the Seminoles face new competition from the recent opening of slot machines at the Gulfstream Park racetrack. Other Florida tracks are expected to expand the competition by seeking similar slots approvals.
That, Weinert said, could force the Seminoles to step up wrangling with Florida over authorization to offer Las Vegas-style gaming at the tribe's state facilities, something that's not allowed now.
"The state would want a share of the revenue," said Weinert, alluding to a potential new financial drain on facilities that enjoy tax-free status.
But the Seminoles, who boast that they were never conquered during the American Indian wars, have a history of facing challenges and controversy.
Tribal history accounts show that Billie was suspended in 2001 and removed from office two years later in a controversy over a contract that provided financing for the Hard Rock casinos in Tampa and Hollywood.
Both sides later reached a settlement over the removal. But the controversy is still playing out in a Florida federal court.
The Seminoles are trying to void a contract under which Power Plant Entertainment, a company affiliated with Baltimore developer David Cordish, arranged financing for the two Hard Rock facilities.
In a court complaint, the tribe argued that the contract violated the federal Indian Gaming Regulatory Act because it awarded the contractor compensation from the casinos' profits.
In a court motion seeking dismissal of the case, Power Plant Entertainment argued the Seminole tribe had previously represented "on at least 30 occasions, in writing, that the agreements with PPE were valid and enforceable."
The tribe's court complaint shows the legal battle prompted the IRS to examine $415 million in tax-free bonds that Power Plant Entertainment helped arrange to finance development of the two casinos.
"The IRS has also preliminarily determined that the bonds are not in fact tax-exempt, causing the tribe additional legal and other expense," lawyers for the Seminoles argued in the complaint.
Citing taxpayer confidentiality law, the IRS declined to comment Thursday. In October 2005, the Seminole tribe announced it would pay off the tax-free bonds, consolidate debt and fund new projects by issuing $730 million in new bonds.
The tribe also said it would wage a continued challenge of the IRS determination.
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