Live updates: Gambling in Texas? Casino, sports betting bills advance but face hurdles

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The Texas House gave initial approval to bills that would allow online sports betting and a limited number of destination-resort style casinos, but the proposals will need more votes to get final passage and be sent to the Senate.

Two sets of proposals were before House lawmakers on Wednesday: One that would allow a limited number of destination-resort style casinos in Texas and another that would legalize online sports betting.

Expanding casinos or allowing sports betting in Texas would ultimately go to voters for approval as a constitutional amendment.

“We should let people vote,” said Rep. Charlie Geren, a Fort Worth Republican, who authored a proposal for destination resort style casinos in Texas, casinos that are accompanied by amenities like hotels, restaurants, meeting spaces, entertainment venues and shopping centers.

Geren’s bill, House Joint Resolution 155, passed 92-51. But because it is a constitutional amendment, the measure needs 100 votes on Thursday, when the bill is expected to next be considered, to advance to the Senate.

Geren’s bill, a companion bill that outlines casino regulations and the proposals for sports betting face tough odds in the Senate and are up against the clock as the Legislature wraps its final weeks and other key deadlines loom. The Legislative session ends May 29.

The vote on the companion to Geren’s bill was delayed until Thursday.

Rep. Jeff Leach, a Plano Republican, laid out a bill that would let voters decide whether to legalize online sports betting, which got a few more votes than the casino measure, passing 97-44. It too will need 100 votes to advance to the Senate. An accompanying bill that details the potential regulations for sports betting was initially approved on a 84-52 vote.

Gov. Greg Abbott and House Speaker Dade Phelan have both expressed openness to destination resort style casinos in Texas and have said the majority of Texans support sports betting. Lt. Gov. Dan Patrick has said there are not enough votes for the proposals to pass in the Senate.

What does the casino bill do?

Geren told his House colleagues Texans are already gambling at casinos in bordering states and stressed that the casinos would be limited in scope. He said proposal would bring in thousands of jobs, bring in billions in new development investments and add a revenue stream for Texas. The measures include a 15% tax on gross casino gaming revenue that would go to education and public safety.

“We’re not just talking about just any kind of casino,” Geren said. “We’re not talking about slot machines in 7-Elevens or a slot on every corner. ... We’re not even talking about slot machines in my restaurant.”’

When it went to the floor for debate on Wednesday, the bill allowed for eight destination resort style casinos: Two in the Houston area, two in Dallas-Fort Worth, one each in the San Antonio, McAllen and Corpus Christi areas and one at an unspecified location. The casino at an unspecified site would have to be picked through an open bid, located at least 100 miles away the cities where the other casinos are located and in a county that approved casinos in Texas.

The proposal was amended to add a casino in the Austin-area and remove the open bid casino at a location to be determined. It was also updated to allow the McAllen area casino to alternatively be in the Brownsville-Harlingen area. A permitted casino was also added to a location where the Texas Racing Association “has issued or is considering issuing a racetrack license.”

“This is an amendment that would allow racetrack licensing in Jefferson County,” said Rep. Christian Manuel, a Beaumont Democrat.

The proposal would allow those who are already licensed for horse or dog racing in the state to apply for a casino license or designate another business to apply. Texas has 10 active horse or dog racing licenses, though only five of the tracks have races scheduled for 2023, according to the Texas Racing Commission.

A person or company couldn’t own more than two destination resort style casinos, and racing license holders don’t have to pursue opening a casino, which creates opportunities for those without a racing license to buy the ability to apply for a casino license. The Chickasaw Nation, Penn Entertainment, Houston billionaire Tilman Fertitta, casino and resort company Las Vegas Sands, and the LaMantia Family, known for beer distribution, have emerged as some of the players in the push for casinos who could benefit.

Sands through its political arm, lobbyists and The Texas Destination Resort Alliance, has spent big to bring destination resort style casinos to Texas. A representative from the company testified in March that they are in active negotiations for a license, were the casinos allowed by voters.

One amendment sought to bar Sands from getting a casino because of its operations in Macau. The amendment said a casino license holder couldn’t conduct gaming operations in China, Russia, Iran or North Korea, with the exception of Taiwan. Geren successfully updated the amendment to exclude Macau.

Geren’s bill would also allow for negotiations on a tribal-state compact to allow Texas’ three federally recognized tribes to operate casino-style games in the state. Texas has some tribal casinos, but the compact would let them broaden the types of games offered.

The Kickapoo Traditional Tribe of Texas has said the bill doesn’t go far enough and would be financially devastating if they weren’t allowed to open a casino closer to San Antonio, where the majority of its customers that go to their Lucky Eagle Casino Hotel in Eagle Pass are from. An amendment addressing the tribe’s concerns was struck down using a successful procedural maneuver initiated by Rep. Tony Tinderholt, an Arlington Republican.

Opposing the bill, Rep. Eddie Morales Jr., who authored the amendment, said indigenous people need to be protected in the bill and criticized the legislation for putting corporations over the tribe.

“Why are we cutting the line for them and putting them ahead of the line when we should be thinking of our own first, in the most vulnerable sector of the society,” said Morales, of Eagle Pass.

Other lawmakers who opposed the bill raised concerns with crime, addiction and increasing the size of government.

“All we have been talking about is the revenue amendment, let’s talk about the cost impact,” said Rep. Matt Shaheen, a Plano Republican. “Let’s talk about human services.”

Sports betting in Texas?

Rep. Jeff Leach, a Plano Republican, is carrying the House’s sports betting legislation. An identical bill has been filed in the Senate, but it hasn’t received a committee hearing. The bills, working together, would allow for and regulate online sports betting in Texas, if approved by voters.

Leach argued that legal sports betting would deter betting on illegal apps on phones and online.

“This is simply allowing what is currently taking place in the state of Texas to be done in a non-criminal, yet constitutional way,” Leach said.

The legislation bars sports betting for those under 21 and doesn’t allow not allow computer terminals in places like clubs for the primary use of sports betting. It establishes a permitted process for sports betting and allows sport governing bodies to enter into commercial agreements. Betting on youth sports would not be allowed.

Initially, operators would have had to pay a 10% tax on net revenue, most of which would go to the Texas Education Agency for property tax relief. Two percent would also go to a fund for problem gaming and addiction. Rep. Chris Turner, a Tarrant County Democrat, successfully amended the bill to increase the tax to 15%, among other changes. Rep. Craig Goldman, R-Fort Worth, added the National Lacrose League to the list of sports that could be bet on.

Thirty-three states and Washington, D.C., have sports betting, according to the American Gaming Association.

Online sports betting in Texas has the support of a number of professional teams through the Texas Sports Betting Alliance. Former Gov. Rick Perry, a spokesperson for the group, has also come out in favor of the idea.

“To echo Chair Leach, we are hoping and expecting to have the necessary votes tomorrow,” Cara Gustafson, a spokesperson for the alliance said in a text to the Star-Telegram.

Rep. Trey Martinez-Fischer, chair of the House Democratic Caucus, was among those to oppose the bill. He also spoke out against the casino proposal.

“It’s the same argument,” he said. “It’s not a no, it’s not now. There’s work to be done on this. We have a revenue stream. We need to prioritize how we’re going to do that. We need to make sure that we have other guardrails, protections, and I think that this is one of these things that we know is not going to go anywhere across the hall.”

This is a developing story. Check back for updates.