The ‘unconquered tribe’ is withholding $350m under a revenue sharing agreement, but tribe says the state has reneged on the deal

In more than a century and a half since the end of Florida’s Seminole wars, the Native American tribe has proudly boasted of its status as the only one never to sign a peace treaty with the US government.

Now leaders of the “unconquered tribe” are skirmishing again with the authorities, in a long-simmering dispute over gambling income that has prompted the Seminoles to withhold $350m due to the state of Florida under a revenue-sharing agreement.

The tribe nets about $2.5bn annually from its seven casinos around the state, some built on tribal lands near the Florida swamps where Seminole warriors led by legendary chiefs such as Osceola and Billy Bowlegs resisted the US army’s attempts to remove them to western reservations during the 19th century.

In 2010, when relations were warmer, the tribe signed a long-term deal with the state to share a percentage of its gambling revenue – with payments estimated to reach $400m a year by 2027 – in exchange for exclusive rights to host the most lucrative house-run card games including blackjack.

But now the Seminoles say the state has reneged on the deal. A number of Florida’s smaller, privately owned casinos – known as pari-mutuels after the form of betting allowed there – are operating such games, the tribe says, by exploiting a loophole in state law.

They say state officials have not been honoring a commitment to “take aggressive enforcement action” against those casinos. After Florida’s governor, Ron DeSantis, stepped in last month to stall a proposed new agreement negotiated between the tribe and state senators that would have settled the issue, the Seminoles decided to ramp up the fight.

“As you know, the tribe and state have engaged in numerous rounds of negotiations to resolve a number of important issues, including a mechanism to shut down the illegal banked card games that were the subject of Judge Robert Hinkle’s decision in November 2016,” Marcellus Osceola Jr, chair of the Seminoles’ tribal council, wrote in a letter to DeSantis.

“The tribe respects your decision to take more time to review the issues and resume discussions this summer. In the meantime the tribe will suspend its revenue share payments until the illegal banked card game issue is resolved.”

The signals emerging from the governor’s mansion appear to be more positive, with DeSantis pledging to use the summer months to talk with the tribe and other interested parties to fine tune details of a comprehensive new gambling agreement, which could also see the introduction of live sports betting in Florida for the first time.

Anticipating the Seminoles’ move to withhold money, Florida’s lawmakers approved a $91bn state budget last month that excluded any income from the tribe. “We’re not going to count dollars we’ve been told are not believed to be owed,” said Bill Galvano, the senate president.

The Seminole tribe is credited with popularizing casino-style gambling in Florida over the last 15 years, growing its business quickly to supplant dwindling sales of tobacco products as a leading revenue source.

Until 2004, when the Seminoles opened their Hard Rock hotel and casino in Hollywood, near Fort Lauderdale, gamblers had to take a cruise ship vacation to play blackjack or feed slot machines. As lawmakers, eyeing the benefits of free money, relaxed restrictions, the tribe’s gambling profits grew to a point where they now fund more than 90% of its operating budget.

“Before gambling came to the Seminoles, they were extremely impoverished and really were living subsistence lives,” said Professor Bob Jarvis, an expert in Indian gambling history at Florida’s Nova Southeastern University law center. “In the course of two generations they’ve gone from among the poorest of Floridians to among the richest.

“They always refer to themselves as the unconquered tribe. They take that very, very seriously and there is this feeling that what we do on our land is not the government’s concern. There’s certainly a lot of very ugly history between the state of Florida and these Indian tribes. While that is true in every state, it’s more so when you throw this much money into the mix.”

Jarvis said any resolution would be complicated by Florida’s politics and “dysfunctional” gambling laws. Seminole casinos offer card games and slots, but not more high-rolling pursuits such as craps and roulette, while non-tribe casinos are restricted even further.

“There are legislators in South Florida who sit there and wonder why we’re giving a monopoly to the Indians instead of opening up Florida to everybody,” he said. “That’s the Las Vegas model where anyone who isn’t a criminal and can pass a background check can run a casino and the state sits back and takes their cut.”

In recent years, he said, horse and dog racing tracks and jai-alai frontons have declined in popularity and have been pressuring politicians to allow them a bigger slice of the gambling action as pari-mutuel casinos, or they would face going out of business. Greyhound racing was outlawed in Florida by a public vote in November, and other operators have become mired in lawsuits over the right to offer alternative forms of gambling.

John Lockwood, an attorney representing several pari-mutuel casinos, denied his clients were doing anything wrong.

“We’ve litigated this issue and have never got a ruling that these games were illegal under state law,” he told the Guardian.

“The tribe’s position is they violate the compact, our position is that they’re legal under state law.”