Will Texas Take a Chance on Gambling?

After years of seeing money go out of state, Texas may finally have a viable plan for legalizing gambling Photo: Associated Press

WASHINGTON, DC, March 25, 2013 - After many years of back and forth debate over the issue, Texas may finally have a gambling bill which offers a substantive plan for legalizing gambling which has a real chance of passing and finally stopping the flow of money and jobs to neighboring states like Oklahoma and Louisiana.

As being considered in the Senate Business and Commerce Committee this week, SJR64/HJR131 is not a perfect bill. It overregulates the industry and micromanages the use of tax revenues to satisfy the needs of various special interests. It could also provide more opportunities for more diverse forms of gambling in the state. But acknowledging these inevitable weaknesses and the truth that gambling really ought to be as minimally regulated as possible, the bill is about as good as we could expect to see out of the legislature. Most importantly it comes with the sponsorship of committee chair John Carona and the support of more Republicans than we’ve seen on board for a gambling bill in a long time.

What makes this a particularly strong bill is the attention to detail and to addressing the concerns which are raised against gambling.  It avoids the pitfall of concentrating too much power in one place and creating conflicts of interest by creating a new independent gambling commission.  It assures real competition in the industry by creating enough potential opportunities to open casinos to allow many parties entry into the industry.  Most importantly it includes provisions to make sure that most of the casinos will be built as “resort destinations” which studies have shown are the most profitable types of casinos with the most positive impact on local economies. 

The bill includes provisions to make sure that at least three of the designated casino zones will be on the coastal islands where communities have been hard hit by natural disasters and the decline in tourism caused by the weak economy and they are perfectly suited to benefit enormously from this kind of development.  This could lead to a renaissance for hurricane ravaged Galveston and a return to its glory days of the early 1900s when it was a glitzy casino resort drawing an international crowd and rivaling Atlantic City.  Geographically and economically Texas’ island resort communities are perfectly suited to this kind of development as demonstrated by resort attractions like Schlitterbahn and Moody Gardens.  Casinos would lead to a boom in development and benefit all aspects of the already existing tourist economy, where more people means more money.

The financially troubled racing industry is also addressed, with all of the presently operating tracks and several which are in the planning stages included in the package as locations for expanded gambling opportunities.  The bill also includes provisions for sharing some of the gambling revenues with the horse and dog breeding communities.  Racing has suffered from overregulation and expanding the revenue streams of the tracks can compensate for the state reducing their profitability.  Several tracks have been hovering on the brink of bankruptcy and this bill will save them and the jobs and revenue they produce.

The Indian interests which have been pushing for casinos for years are given an opportunity to be involved.  Indians in Texas have gotten the short end of the stick since the tribes were forcibly removed to neighboring states in the late 1800s.  All Indian land was taken by the state and though the small patches they have reclaimed by various means aren’t much good for anything else, they are geographically isolated and perfect for locating destination casinos.  The bill provides for casinos on these few areas of tribal land with a program for sharing some revenue with the state.

The bill also includes the expected community safeguards, pandering to critics who raise the same  largely groundless complaints every session.  It provides money to fund gambling addiction programs, meaninglessly earmarks revenue for education and debt reduction, and requires a public vote of any county where a casino would be established to approve its construction.  And it’s also a constitutional amendment, so the entire population of the state gets a chance to vote to approve or reject it.

This isn’t the only bill. A backup is now in committee. SJR36/HJR121 is a much more modest proposal, backed mainly by Democrats, which would allow casinos on Indian land and Video Lottery Terminals at racetracks, but no other expansion of gambling. It’s not as comprehensive a proposal, but it would still be a step in the right direction and it’s always good to have a fallback.

With billions in consumer dollars leaving the state every year to neighboring states, all of which have legalized gambling, it’s about time that the Texas legislature got serious about keeping some of that business at home.   With 80% of the cars in the parking lots of Lake Charles casinos bearing Texas plates, the problem is too obvious to ignore. 

Let’s put irrational prejudice aside and stop listening to propaganda paid for by gambling interests from neighboring states.  This is a good bill which will bring Texas gamblers and their money back home to grow our economy.  At the very least it should be on the ballot so the people have a chance to vote on it.

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Dave Nalle

Dave Nalle has been writing political analysis since the 1980s for newspapers, magazines and now online journals. He is currently Execitive Director of the Center for Foreign Policy Priorities, is on the board of the Coalition to Reduce Spending, and served four years as National Chairman of the Republican Liberty Caucus.

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