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Business Observer Wednesday, Aug. 10, 2011 9 years ago

Contracting with Seminole Nation

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Though it's a sovereign government, contracting with The Seminole Tribe of Florida doesn't require 'an Act of Congress' — in fact, it's a straightforward process.
by: Jay Brady Government Editor

REVIEW SUMMARY
What. Doing business with the Seminole Tribe of Florida.
Issue. Businesses must register, but opportunities abound.
Impact. Gambling expansion fuels business for tribe's vendors.

With millions of potential business in their backyards, Tony Alves thought local companies would be lining up to work with the Seminole Tribe of Florida. What the vice president of operations for Seminole Casino Immokalee found out, though, is they just didn't know how.

It's a situation Alves discovered when contacting local car dealerships to ask why they weren't doing business with the casino. “They all pretty much said, 'We'd love to do business with you,'” Alves recalls. “Well, why aren't you?” he asked them. To which several replied: “I don't know how.”

Alves recounted the story at a recent breakfast meeting of the Eastern Collier Chamber of Commerce. He attended in an attempt to remove any perceived veil of secrecy surrounding the tribe's vendor process and encourage local firms to pursue deals with the tribe.

For example, Alves says after reaching out to the aforementioned Gulf Coast dealers, he was able to shift the casino's vehicle purchases from the east coast to closer dealerships. Now, the casino buys vehicles from Sam Galloway Ford in Fort Myers and Estero Bay Chevrolet both for its fleet and for its monthly prizes.

Alves says the casino is also pushing to work with more local companies, including hotels, bus companies and drycleaners. “We do want to support the local businesses as much as we can,” says Alves, who took his job with the casino three years ago after working a dozen years in Las Vegas. “We're just looking for quality service at a reasonable price.”

Dispelling the 'mystery'
According to Alves' story, there's been a bit of mystery surrounding what it takes to contract for work with the Seminole Tribe of Florida. But the process those companies that already provide an array of goods and services to the tribe's various enterprises, including its seven casinos, find the sovereign nation relatively easy to work with.

The first step is for businesses to register with the tribe as vendors. For any vendor providing nongaming-related good or services, the Tribal Gaming Office requires submittal of a two-page vendor registration form and a nonrefundable vendor registration fee of $250. To maintain the registration, there's an annual fee of $250.

Seminole Tribal members with majority ownership in companies conducting business with Seminole Gaming or Seminole Gaming operations are exempt from both fees. Utility companies, charities, entertainers, major freight carriers, Seminole tribal member employees conducting business as a vendor and certain professional services may also be exempt from fees.

The Seminole's Hollywood headquarters manages purchase orders, which follow a competitive bid process. Alves says the bid process is based on price, quality and service. “In our business, just like your own businesses, we have to keep our costs down and our profits up. It's a simple business formula,” Alves says.

John Fontana, president of the Seminole Hard Rock Hotel & Casino-Tampa, agrees there's no mystery to the process. “For folks that have had any experience with it, our vendor registration process it isn't anything extraordinary,” he says. “You can do it online; it's not an especially onerous process.”

Fontana also notes that it's even easier for smaller companies, who don't have to provide as much information. In fact, he says that once a smaller company gets its vendor license, it adds to its credibility in the eyes of other potential clients because it survived the tribe's background checks.

A vendor application takes about six to eight weeks to get approved, according to the central purchasing office. After that, Seminole staff put vendors in contact with a buyer for that commodity or service.

Interestingly, the tribe doesn't advertise for bids. Instead, when the tribe seeks to select a vendor, the buyer contacts the vendors that provide the product or service, typically by email, or by phone, and provides the specifications, bid date, and necessary details.

Big business
Jack Johnson, president of Jack and Ann's Feed and Supply, Inc. in Immokalee, says he has had the Seminole Tribe of Florida as a client for 22 years, and appreciates the tribe for more than just its expanded casino. “They have many different enterprises that have certain needs, and we had a business that met some of those needs,” says Johnson, who has bid on and won numerous contracts. “They're instrumental to the local economy.”

The Seminole Tribe of Florida purchases $870 million of goods and services from Florida vendors annually, pumping much needed revenue into the Florida economy.

And with a new state gambling compact and expanding casinos at near opposite ends of the Gulf Coast — the Seminole Hard Rock Casino-Tampa and the Seminole Casino Immokalee in eastern Collier County — the sovereign nation's needs for area vendors' offerings continues to grow.

The Immokalee property consumes more than $22 million of goods and services annually, and the Hard Rock purchases nearly $118 million worth each year, according an unreleased economic impact study the tribe undertook late last year, relayed by tribe spokesman Gary Bitner.

The Johnsons' company provided hardware and plumbing material for the nearby casino when the tribe built the original 31,900-square-foot facility in 1994. The husband-and-wife-owned company also contracts with other tribe enterprises, including the youth ranch and the rodeo arena. Johnson says the business provides anything that's livestock or farm and ranch related, as well as lumber and building materials.

But it's the expanded casino — now 75,600 square feet — that makes the largest impact on the Southwest Florida economy from florists to landscape contractors to car dealerships. Naples-based Kraft Construction was the general contractor for the expansion.

That more than doubling of floor area in 2009, at a cost of $22 million, and the potential for more, draws the attention of vendors looking to initiate or further a business relationship.

Alves, who reports to General Manager Tony Sanchez, says a future hotel on the property is part of the tribe's long-term plan for the casino.

Already, the casino claims bragging rights as the No. 1 tourist destination in southwest Florida, according to Alves. The Everglades comes in second. The casino attracts 1.7 million visitors a year, says wildlife photographer Fred Thomas, chairman of the Eastern Collier Chamber of Commerce, who has also done work for the casino.

The Hard Rock's not standing still, either. “This year we're about to launch 1,300 parking spots in a garage, and more casino and slots and a new restaurant,” says Fontana. “That's beginning almost any day now.” The tribe also has plans for a future hotel tower at the Hard Rock.

“What people can actually do is going to be much more in the gaming space and the governmental space, generally,” says Bitner about future opportunities for vendors. Government opportunities, he says, includes police, health and education — “ ... all those things that a typical local government would spend.”

Communication is key
Vendors like Jack Johnson and others all appreciate the opportunities and say the process is simple and fair.

Johnson describes his business relationship with the tribe as “excellent.” He's done work for other government agencies, and says its “ ... probably easier actually. It's a large governmental agency. It's just a process — probably not as complex as county government or state government.”

Bernadette and Benny Starling, owners of B-Hive Flowers and Gifts Inc. in Immokalee, have been operating for 38 years and vendors to the casino since it opened in 1994. “I try to be helpful and give them extra,” says Bernadette Starling. “They've been very supportive of us.”

Landscape contractor Armando Ayala, owner of Immokalee Landscape Inc., registered as a vendor with the casino and the tribe roughly five years ago. He just completed another job laying three pallets of sod.

“They've been excellent to work with,” says Ayala, who adds that not all work is awarded to the lowest bidder. It's also based on performance. “I've never had a problem. They're really good with their communication.”

Interestingly, Ayala also says: “A lot of people overbid. They think they just have a ton of money.”

It's not hard to see why. According to an annual study of Native American gaming revenues by state, Florida tribes handled more than $2 billion in 2009, the vast majority coming from the Seminole's seven casinos. The Miccosukee Casino in Miami-Dade accounts for a portion.

Johnson, who's worked with several of the tribe's business enterprises for most of the past two decades, has seen the revenue growth first hand. “They're a vital part of our overall business and success,” he says.

And Johnson may have the best perspective to give advice to companies looking to do business with the Tribe. “There's a process involved and you've got to learn the process,” he advises. “Once you learn the process it's all great, it's all good.”

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