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Here comes the casino push

Expect this to get louder and louder, though whether it’s successful or not remains to be seen.

Casino1

When a big political player comes waltzing into Texas spending big money from out of state, it’s usually a good sign that he wants something from lawmakers. So when Las Vegas casino magnate Sheldon Adelson and his wife, Miriam, spent $4.5 million to help Republicans keep control of the Texas House in 2020, heads turned.

While Adelson is known for cutting big checks—he’s one of the most powerful GOP mega-donors in the country—he doesn’t usually spend so lavishly on state-level politics. What did he want with Texas?

After the election, it became clear that Adelson was embarking on an all-out push to legalize casino gambling in Texas. In November, his corporation Las Vegas Sands started hiring some of the most powerful, well-connected lobbyists in Austin. The company declined to comment, though in early December, Andy Abboud, the company’s senior vice president for government relations, made the plans official. In an online panel at Texas Taxpayers and Research Association’s annual conference, he laid out the company’s hopes that Texas lawmakers would approve legislation lifting the casino ban, allowing for the establishment of a limited number of luxury destination casinos in the state’s major metro areas. “Texas is considered the biggest plum still waiting to be [picked],” Abboud said.

Gaming laws in Texas are among the most restrictive in the country, with bans on almost all gambling—including slots, table games, and sports betting—enshrined in the Texas Constitution since the Prohibition Era. Currently, gaming is restricted to wagers on dog and horse racing, charitable bingo, and the state lottery. The state’s three federally recognized Native American tribes are allowed to operate casinos with limited games, though the state has repeatedly contested their rights in the courts. Republican leaders like Governor Greg Abbott and U.S. Senator John Cornyn have aggressively resisted tribes’ attempts to expand gaming.

Abboud encouraged hesitant lawmakers to think “like you’re attracting Tesla or an Amazon facility or an entirely new industry to the state that’s going to create tens of thousands of jobs and hundreds of millions of dollars in tax revenue and ancillary benefits of hotels and tourism.”

[…]

Adelson’s casino push comes as lawmakers head into a session facing deep revenue shortfalls spurred by the pandemic and resulting economic crisis. In past sessions, casino proponents have argued that the state’s gaming prohibition has allowed billions of dollars to abscond into Oklahoma and Louisiana, where casinos are conveniently located just across the border. But opponents say that promises of revenue windfalls are overblown and would not provide a sustainable new revenue stream.

Abboud argued that Las Vegas Sands’ model for casinos in Texas would build another economic pillar in the state, helping to ease the state’s dependence on the oil and gas industry. “Will they solve all economic problems? No. Will it stabilize the economy? Yes,” he said.

So far, the only casino gambling legislation filed is from state Representative Joe Deshotel, a Beaumont Democrat, whose bill would legalize casinos to fund insurance programs for those living in hurricane-prone areas along the Gulf Coast.

Who ends up authoring the Adelson camp’s bill in the Texas House and Senate will have big implications for its success. If an ally of Lieutenant Governor Dan Patrick authors casino legislation in the Senate, that could be a sign that Patrick would allow it to get a vote on the floor, says Mark P. Jones, a political science professor at Rice University. “If Patrick is on board, it passes. If Patrick is not on board, it doesn’t. It’s about as simple as that,” Jones says. A signal of support from Patrick, a social conservative who has previously opposed gambling, could also sway House Republicans who would otherwise worry about primary challenges from the right, he adds.

This Chron story from early December is the reference for those Andy Abboud quotes. We go through something like this every two years, and the smart money has always been to bet against any expansion of gambling, including casinos. The financial arguments have some merit, though they are surely being overblown by the casino interests. The catch there is that Greg Abbott and Dan Patrick et al don’t see a lack of revenue as a problem but as an opportunity to cut costs. Maybe this time it’s different, I don’t know, though now that the revenue picture isn’t as bad as it once looked, whatever financial argument the casinos may have made has less heft.

The casino interests have certainly hired a bunch of expensive and well-connected Republican lobbyists, so I do expect they’ll be able to get some facetime and bend a few ears. Maybe this is a long-term play, as Jim Henson suggests, where the groundwork gets laid this session and ultimate success comes a few years down the road. Who knows?

I remain ambivalent on the whole thing – I don’t have a problem with gambling and generally think adults should be allowed to partake in it, but I don’t see casinos as a net positive, and I believe the economic benefits that get touted will be extremely limited to a small class of renters, and not much good to anyone else. If we do someday get to vote on it as a constitutional amendment, I’ll have to see what the specifics are before I decide. We’ll keep an eye on this because it’s likely a high tide year for gambling interests, but as always don’t expect much.

UPDATE: I drafted this over the weekend, and since then Sheldon Adelson has passed away. I don’t believe that changes the calculus in any way, but I’m sure someone would have noted that in the comments if I hadn’t, so here we are.

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7 Comments

  1. Bill Daniels says:

    I guess it’s time for my bi-annual comment on casino gaming here in Tejas:

    There is absolutely zero GOOD reason casinos, OTB’s, and other gaming businesses should be illegal in Texas. Yes, gambling is a problem for some folks, just like alcohol, cigarettes, over eating, and other vices can be. We don’t have proscriptions on HEB for selling food, lotto tickets, or alcohol, yet we’re Johnny on the spot to keep out those evil casinos. It’s not the Moral Majority conservatives that are opposing gambling, it’s paid off legislators who are doing the bidding of lobbyists and not the people.

    The legislature should RE-legalize all forms of gambling and let Texans make their own choices. Personally, I don’t play the lotto and I probably wouldn’t go to a casino to gamble, but I might go for the other trappings…..seeing a show, or eating at the buffet, for example. Texans should have that choice. That’s what a free society is supposed to be about. Beyond all that, it’s unconscionable that Texans are blowing untold amounts of money across the Sabine and Red Rivers. That money should stay in Texas.

    Surely this can find non partisan agreement here, right y’all?

  2. Randolph Baker says:

    As a former professor of casino gaming management at two universities (UNR and SDSU), I agree with Mr. Daniels, but I will go one-step further and point out that Pennsylvania brings in more than $1 billion a year in taxes from a limited number of casinos, money that otherwise would have continued to flow mostly into New Jersey. Texans are said to spend $2 billion + annually at casinos in Nevada or states adjacent to Texas. That is money Texas could recapture easily at very little expense should it choose to legalize a small number of casinos in appropriate places.

  3. Tom in Lazybrook says:

    This is a plan by 6 billionaires to create a monopoly on gambling that will lock out African American, AAPI, LGBT, and Hispanic owners.

    No one should support it.

  4. Bill Daniels says:

    Tom,

    Got any links discussing that? If we re-legalize casinos, I would expect the Indian reservation casinos would be first on line, because they already have the infrastructure in place. I don’t see how any regulations that prohibit the Indians, or any other comers with money from starting up a casino, would pass constitutional muster. It would be an easy equal protection clause argument to make.

    I’m not saying you’re wrong, I’d just like to see the info. I recall one of the northern states entertained a marijuana law that kind of mirrors what you are suggesting about a proposed Texas casino law….written specifically to cut out all but a select few from going into the newly legalized business.

    Also, I’m unfamiliar with “AAPI.” American Association of Professional Investors?

  5. C.L. says:

    The politicals, lobbyists, TX business owners, etc., who are against legalized gambling in Texas have, I suspect, only adopted that position because they have yet to figure out a way to money off of it.

  6. Manny says:

    Texas I believe has the most Evangelicals in the country, they vote in Republican primaries, wonder which Republican is going to take the lead.

  7. Paul Kubosh says:

    I would rather have legalized gambling than legalized pot.