What will legal gambling bring to Texas? That’s the big question state lawmakers are asking their crystal balls.
Will it be reliable revenue, job growth and pride? Or crime, community decay and shame?
With multiple pieces of gaming legislation on file in both houses, legislators can now begin parsing the details. They’ve still until the Mar. 10 filing deadline to frame arguments, make projections and construct the narrative that either ushers Texans into the legal gambling era or shields them from it.
Dollar amounts, regulatory requirements and funding targets will be negotiated in answering all of those questions, but alongside those negotiated details will be other collateral outcomes.
The Medium is the Message
Collateral outcomes are what the Canadian philosopher Marshall McLuhen had in mind when he coined the phrase “the medium is the message.” McLuhen’s statement implied that a medium itself says as much about a community as any message sent over that medium.
Take the television. In its infancy, it had the collateral outcome–or meaning–of bringing families together in the evenings when the choice programming aired. Smart phones had the collateral outcome of changing driving laws to combat distracted driving. More recently, in-game sports betting, insofar as we can call that a medium, has had the collateral outcome of intensifying fan interactions with players at live sporting events to the extent that players are heckled and threatened for costing fans their bets.
PlayTexas has considered three such collateral outcomes from the expansion of legal casino gambling and sports betting in Texas.
HJR 97 and expanded casino gambling could save horse racing in Texas
Since the creation in 2020 of the Horseracing Integrity and Safety Authority (HISA), a federal horse racing regulator, Texas has seen its horse racing industry crater.
This resulted from a conflict with the state’s regulator, the Texas Racing Commission, that has repeatedly stated that it would not acknowledge HISA’s oversight.
In response to Texas’s lack of capitulation to HISA, HISA has required Texas race tracks to stop exporting their racing signal to other states for betting purposes.
Without the betting revenue from other states, horse tracks have seen betting handle drop by over 90%. Workers and purses cannot be fully paid, and the prospect of shutting down events is quickly becoming a reality.
This is where House Joint Resolution 97, Rep. Charlie Geren’s casino legislation comes in. In light of the dire straights Texas horse racing finds itself in, his legislation could be a life preserver.
HJR 97 gives priority for casino licenses to Texas racetracks with current racing licenses. Were a racetrack to build a casino, they would pay a 15% tax on gross casino gaming revenue, and a portion of that tax would go toward horse racing purses “to promote the growth and sustainability of the horse racing industry in the state.”
At the moment, purses for major racing events have dropped from the low millions to the lower hundred thousands and Geren’s legislation and the attendant tax revenue couldn’t come soon enough.
Texas casinos could put an end to private poker clubs
Casinos may not be the boon to poker rooms that they could be to race tracks.
Rhetorically speaking, were casinos to open in major metro areas like Dallas, Houston, and San Antonio, how amenable would those casino owners be to small scale card rooms siphoning off customers?
Mixed residential communities have already expressed their displeasure at seeing gambling venues adjacent to neighborhoods and schools. A single commercially-zoned casino centralizing the gambling action could ameliorate some of that.
Not only would a casino draw many of the players from private card rooms, but it would also attract more players from surrounding areas. With a higher quality game and more players, Texas casinos would spell the end for many private card rooms in the state’s major metro areas.
Add to that the precarious legal status of card rooms throughout the state, and it’s not hard to imagine a casino developer leaning heavily on local governments to quash poker rooms once and for all.
This matter may be a foregone conclusion as the status of poker rooms seems destined to reach the Texas Supreme Court where the state’s current model of allowing “private card rooms” may not hold up under scrutiny.
Legal sports betting could advance school curriculum on responsible gaming
Every state that legalizes sports betting has the opportunity to set a new standard for the industry. One place where Texas, due to its size and the fanatical nature of its sports fans, can do this is in the development of school curriculum on the importance of safe gambling practices.
Some might see this as an ironic silver lining to a self-inflicted problem, but that misses the point. Texans are already betting on sports at an alarming rate. They’re just doing it illegally or driving out of state, and there has, as of yet, been no push to truly address problem gambling education among young Texans.
Drafting a law to legalize sports betting gives the state an opportunity to formally address problem gambling education through funding and a codified curriculum.
Similar approaches have been taken in the UK where research studies comparing paid reward systems in video games to legal gambling inform school curricula.
Virginia, in 2022, became the first state in the nation to enact a law requiring high school students to receive safe gambling information in the same manner they receive information on substance abuse awareness. Michigan is also spearheading similar education reform.
Texas could push this further by developing a more fleshed-out curriculum built on existing data on teenage problem gambling and programs like those in Virginia and Michigan.