Texas to decide on Casino Legalization in new proposal

On Friday, Texas casino legalization advocates announced new legislation that will allow them to partner with horse racing operators in the state. State Sen. Carol Alvarado (D-Houston) made a previous attempt to legalize gambling in the state in 2021 when she filed a similar proposal in the Senate.

The House Joint Resolution 97, filed by State Rep. Charlie Geren (R-Fort Worth), seeks to amend the Texas Constitution and allow voters to decide whether they want casinos legalized in the state in the upcoming November election.

If a majority agree to the gaming venues, operators will be authorized to apply for licenses to construct seven high-end “destination resorts” in the state. The resolution would take a different approach than previous proposals by requiring that license applicants are Texas racetrack associations or designees of said associations.

“Polling over the last year makes it clear that more than 85 percent of Texans want the right to vote on this issue, Republicans and Democrats alike,” Geren stated.

“It is high time that the legislature listens to the voters and allow them to decide this issue.”

A newly formed Texas Gaming Commission will be responsible for regulating the gaming venues if the proposal is passed and approved by the Texas voters. According to Geren, the gaming venues would provide billions of dollars in tax revenue to the benefit of the state and local governments. The casinos would also create several thousand jobs and contribute to the economy by supporting tourism.

The bill also calls for the legalization of sports wagering; however, it states that the activity can only be conducted in a manner and location approved by the legislature. The proposal did not mention a specific tax on sports betting, but a 15 percent tax was placed on gross casino gaming revenue.

Texas legalized horse and dog racing wagering in 1987 after it was approved in a referendum. According to the state’s Racing Commission, four Class 1 racetracks were active in Texas as of last year. These include Houston’s Sam Houston Race Park, Lone Star Park located in Grand Prairie, Dallas-Fort Worth, Gillespie County Fair in Hill Country, and Retama Park in San Antonio. Five other racetracks were inoperative in 2022, except one in South Texas.

The casino bill mandates that for every casino location, the initial license applicants must be a local racetrack associate licensed on January 1, 2022. If not, the individual needs to be designated by an association. The racetracks will be allowed to apply for a separate license to operate a casino in its current location or another place within its metropolitan area.

Per the 2021 proposal, racetracks were only allowed to request “limited casino gaming.” This was basically a gaming facility with at most “750 gaming positions, of which not more than 25 percent may be at table games.”

Racetracks are given more room in the new proposal by increasing its envisioned “destination resorts” from four to seven. The seven gaming locations proposed by the bill include two gaming venues in the Houston area, two in the Dallas-Fort Worth area, and one in McAllen, Corpus Christi, and San Antonio metropolitan areas. This arrangement allows an existing racetrack operator in Houston and Dallas areas and an outside company to build gaming venues.

Like the 2021 bill, Geren’s proposal requires casino license applicants to turn in a minimum investment for the construction of the gaming venues depending on the metropolitan areas. The Houston and Dallas Fort Worth casinos are expected to have an investment of at least $2 billion each.

The other casino locations require lower investments, with San Antonio requiring $1 billion and $250 million for McAllen and Corpus Christi. Any track that receives a casino license will need to keep up a list of live racing dates that are higher or the same as the amount run a year prior.

Penn Entertainment, previously called Penn National Gaming, is the owner of Sam Houston Race Park as well as Retama Park. Chickasaw Nation’s subsidiary Global Gaming owns Lone Star Park. The company also operates Remington Park, located in Oklahoma City, and WinStar World Casino and Resort at the Texas border around southern Oklahoma.

According to the bill, an unspecified portion of the 15 percent tax on gross casino revenue would be diverted to be used as horse racing’s prize money. It claimed that this would “promote the growth and sustainability of the horse-racing industry in this state.”

More gambling news