Rome wasn’t built in a day.
That also holds true for bringing sports betting to Texas, but during the 2021 session, there were the beginnings of a foundation.
Though no bills related to sports betting or casino gaming reached the floor of either legislative chamber for a vote during the just-completed session, the general sentiment in Austin is that all parties involved are playing the long game with an eye on the 2023 session. The Texas state legislature meets only in odd-numbered years.
The Texan reported that the Las Vegas Sands Corporation hired 73 lobbyists to push for legalizing casino gaming this year. While the exact cost to register all of those lobbyists is unknown, the Texas Tribune reported in January it cost between $2.3 million and $4.5 million for the 51 it had at that point. That spend is in addition to Sands’ reported multimillion-dollar advertising campaign to promote general public awareness and support.
The dynamics of the state legislative schedule also point to needing plenty of patience. The state legislature opens its session the second Tuesday of January in odd-numbered years and is limited to 140 days. Given the size of Texas — at 29 million people, it’s the second biggest U.S. state — there is an awful lot to pack into 140 days of legislating. This past session had legislators also dealing with the effects of the COVID-19 pandemic and addressing infrastructure issues related to February’s failure of the state’s electrical grid.
In some ways, sports betting to the Texas legislature is the kid who just moved into town and wants to make new friends. It just needs to find a way to draw some attention.
No vote ≠ no progress
Betting first person to score is amazing. Texas hurry up and legalize sports gambling already
— Don Yo (@dopenessofDon) May 28, 2021
State Rep. Dan Huberty was able to present his bill, HB 2070, to the State Affairs Committee in April. While it didn’t get out of committee, Huberty was upbeat.
“Even though it didn’t pass, it was positive,” he said, noting the grid issues took up a lot of the committee’s time. “It was an educational experience for members of legislature for what the Supreme Court did in 2018 and how many other states are dong it. That the economics of it are a long-term positive. It’s the first time in many, many years there’s an open dialogue in the state of Texas, including the discussion of destination and resort gambling.
“Often times in Texas, after you introduce legislation, it takes a while to get things done.”
Huberty’s bill deals exclusively with sports betting, which he feels could potentially move faster than casino gaming given the Supreme Court’s decision to strike down the Professional and Amateur Sports Protection Act and make sports betting a state’s rights issue, and the continuing growth of the industry. After providing a primer to State Affairs, the task of gaining support from fellow legislators is the next step in the process.
“We’re laying the groundwork,” he said. “Now that the education process is done, (you) work on the members in the interim. It’s a conversation that we have to have with our counterparts on the Senate side, the lieutenant governor’s staff and the governor’s staff.”
Lt. Gov Dan Patrick has been on record as a noted opponent of legalizing sports wagering in Texas and had made clear during the session there wasn’t going to be support in moving any legislation forward. Convincing him and Gov. Greg Abbott — who vetoed a bill in 2015 that would have allowed the Texas Lottery to study the feasibility of online gaming — will be pivotal in getting any momentum.
“My thought process is we go through this, have talks with governor’s staff for attitude and aptitude. My goal is that we do some studies, see where other states have landed,” Huberty said. “Texas doesn’t follow anyone, so explaining where we make the economic impact, that’s where we win the day.”
One component of the bill Huberty has been retooling is incorporating the Kickapoo Traditional Tribe of Texas, which operates Class II gaming in Eagle Pass near the U.S.-Mexico border approximately two hours west of San Antonio. During testimony, the Kickapoo opposed HB 2070 because it did not want to be left out of negotiations. Huberty pointed out “we want them to be a part of this” while noting they were working on language that would allow the tribe to have a sportsbook.
Will Louisiana add urgency to the equation?
LOUISIANA:
Good news for ya'll.
Framework bill allows for 41 digital platforms and lawmakers are hoping for fall launches.
Separate bill determining tax rates already sent to Gov. @LouisianaGov for signature.https://t.co/FbLlVcI8Ya
— Sports Handle (@sports_handle) June 4, 2021
Even with Abbott already having scheduled a special fall session in either September or October to cover federal COVID-19 relief and redistricting, there is no guarantee sports wagering and/or casino gaming will come up for discussion. The governor sets the agenda of any special legislative session, and there were reports he may also convene a separate one earlier to deal with the highly contentious Senate Bill 7, which deals with elections legislation.
If Louisiana is able to launch sports betting in the fall as state lawmakers there hope to do since there is now framework in place for legalization, it will become the second state bordering Texas to have legalized sports wagering along with Arkansas. Unlike the Razorback State, Louisiana will have mobile sports wagering, creating further competition for gaming dollars that already exists with casinos there and Oklahoma. The Louisiana House on Thursday passed a key framework bill that should land on Gov. John Bel Edwards’ desk sooner than later.
Many people in east Texas cross the state line into Louisiana to gamble at casinos in Lake Charles — which is approximately two hours from Houston — and New Orleans. Additionally, the Winstar casino just across the Red River along the Texas-Oklahoma border is less than two hours from Dallas.
While the $5.6 billion annual offshore sports betting handle cited by the Texas Sports Betting Alliance is an eye-popping figure, the more direct line of sight in seeing potential tax revenue slip across the state line could prove a catalyst that spurs lawmakers. Huberty’s bill has corresponding legislation in the Senate (SB 736), and the goal is to have both bills tied to House Joint Resolution 97 and Senate Joint Resolution 39 to be brought to the voters as a Constitutional amendment for what figures to be the November 2023 election.
How long it would take for lawmakers and regulators to create a framework to accept wagers is unknown, but the usual length for non-gaming states in other jurisdictions from legalization to launch is approximately one year. Arizona, though, appears on track to launch in just five months after announcing a target date of Sept. 9, and Louisiana would do so approximately 10 months after voters approved sports betting via referendum in last November’s election. Both of those states already have existing gaming infrastructure, where Texas does not.
“I think it’s important,” Huberty said about neighboring states moving forward with sports wagering and casino gaming and the effect it could have on his fellow legislators. “Louisiana already has casinos, you can drive into Lake Charles and New Orleans, and there are a ton of Texas license plates in there. You go into Oklahoma, two miles across the border, and there is one of the largest casinos in the country.
“(Sports betting) is happening, we get that. Now is the time to continue the educational process, take advantage of that opportunity. We’re not going to push (for a vote) right now because there’s more work to do, more education. We’ll come back, hold interim hearings, look at the economic impact and explore this. This is something that really can be given to voters as a Constitutional amendment.”
