SureBet Racing – by Martha Claussen

April 2013 – Every two yearsthe elected officials of Texas convene in Austin to review a myriad of bills and legislative documents. For close to two decades, members of the Texas racing industry have appealed to lawmakers for legislation that would allow video lottery terminals, or VLTs, at racetracks. Legislators have been implored to acknowledge the massive amount of money leaving the state with Texans who support gaming in neighboring states of Louisiana, Oklahoma and New Mexico.

The compelling economic impact studies have pointed out the benefit to the state in revenues for education, agriculture and tourism.

In 2011, more than 26 gaming bills were introduced and the Licensing and Administrative Procedures committee passed Constitutional Amendment, HJR 137, to authorize the legislature to legalize and regulate the conduct of one or more types of gaming involving wagering in Texas, contingent on approval by the voters at a statewide referendum. Unfortunately, the deadline passed without the required 100 votes, and therefore, nothing further occurred in that session.

However, progress has been made in the 83rd Texas legislative session, and two bills have been filed and sent to committee. On Feb. 22, Sen. Juan “Chuy” Hinojosa (D-District 20) filed Texas State Senate Joint Resolution No. 36 and enabling Senate Bill No. 789 that call for a constitutional referendum to allow video lottery games at licensed horse and greyhound racetracks and by Indian tribes under the regulatory authority of the Texas Lottery Commission and the Texas Racing Commission. This bill has been assigned to the Senate Business and Commerce Committee.

Subsequently, on March 6, Rep. Richard Raymond (D-District 42) filed companion legislation HJR No. 121 and HB No. 2729, also calling for a constitutional referendum to allow video lottery games at licensed horse and greyhound racetracks and by Indian tribes. Review for this bill has been assigned to the House Licensing and Administration Committee.

Let Texans Decide!

One of the greatest frustrations of the battle to get legislative help has been the failure to get bills from the House to the Senate so that the public can vote for expanded gaming in Texas. In 2012, a new initiative called Let Texans Decide! was established. The campaign is a coalition of state business leaders, horsemen, community organizations, and Texas citizens committed to passing legislation at the Texas Capitol that will put the issue on the ballot for the voters of Texas to decide.

Studies and polls have firmly established that an overwhelming majority of Texas voters, regardless of political party or geographic region, want the right to decide this issue for themselves.

Let Texans Decide! embarked upon a campaign to get support from the equine and racing industry with social media and a very simple web link for people to sign up and receive updates. More than 8,800 citizens across the state have lent their names, and the highly respected Sen. John T. Montford led a public affairs campaign to allow Texans the opportunity to vote on the expansion of gaming. As a successful Texas businessman as well as serving in the state Senate for 14 years, Sen. Montford has served as an ardent backer of giving the public voting power to decide and stop the exodus of dollars out of state.

“Like most Texans, I’m frustrated seeing billions of our hard-earned dollars fleeing the state,” said Montford. “Senator Carona, Senator Hinojosa and Representative Raymond have each authored legislation that puts the issue in front of the voters, allowing Texans to stop the hemorrhaging of billions of dollars to neighboring states.”

Sam Houston Race Park president Andréa Young has been heavily involved in legislative efforts to aid the Texas racing industry. Young, who joined Sam Houston in 2007, is encouraged with the recent developments in Austin.

“Senator Corona’s bill is the first bill that has put racetracks and casinos on the same playing field,” said Young. “Horsemen have three vehicles for expanded gaming; two in the House and one in the Senate. We are seeing unparalleled bipartisan efforts in the Texas House and Senate. Nothing like this has ever happened before.”

The month of April will play a pivotal role in whether the bills will get out of committee and advance to a House and Senate vote.

Texas Horsemen Struggling

Purses are funded by racetracks, state breed funds and handle, but casino revenue has greatly enhanced the numbers in neighboring states. Without that added revenue, horsemen in Texas suffer mightily. Sam Houston Race Park in Houston and Sunland Park Racetrack & Casino in New Mexico were running Thoroughbreds within days of each other in March. Sunland Park is located just west of El Paso, Texas, but as a result of racino dollars, it is able to offer $12,200 for a claiming race that Sam Houston Race Park ran for $7,500. Sunland’s non-graded stakes offers a purse of $85,000; Houston’s is $50,000. There is a similar disparity for Quarter Horse purses, with Remington Park in Oklahoma City sometimes offering three times the money for the same conditions in Texas.

Feed, vet bills, salaries for backstretch workers, horse trailers and other expenses are the same for horsemen running in Louisiana, Texas, New Mexico and Oklahoma. The purses, sadly, are not, and more and more horsemen are faced with either shipping out of state or simply closing their operations.

Mary Ruyle, executive director of the Texas Thoroughbred Association (TTA), knows the importance of this legislative session. Many prominent Texas breeders have left the state and, without a strong breed program, funding for Texas-bred racing programs and stakes has been greatly impacted. She and her board of directors have seen a growing number of stallions and broodmares being shipped to bordering states that offer higher incentives.

“TTA is working diligently to track legislation beneficial to horsemen,” said Ruyle. “We have kept our membership informed and involved through weekly email and postcard updates, encouraging them to contact their legislators to voice support for these bills.  There is a cooperative industry effort between the breed registries, horsemen’s organization, racetrack operators and the member organizations of Texas HORSE to visit legislators, provide them with industry information and seek their support.”

Horsemen are optimistic about the developments so far in 2013. Judd Kearl operates a training center in Madisonville, Texas, and runs both Thoroughbreds and Quarter Horses. He has won five training titles at Sam Houston Race Park, but had no choice but to ship to Louisiana and Oklahoma to keep his operation afloat.

“I really like the way it’s going this year,” said Kearl. “Things are better and there is more agreement on how to approach the lawmakers.”

One of the state’s leading Thoroughbred trainers, Danny Pish, concurs.He has won the training title at Retama Park for the past 13 years and continues to be one of the top conditioners at both Sam Houston and Lone Star. Pish resides in Cibolo, Texas, just minutes from Retama Park. For the past three years, he has shipped a string to Remington Park in Oklahoma and sent some of his better horses to Fair Grounds in New Orleans. In addition to running for higher purses, Pish wishes legislators would understand how many jobs are impacted when Texas is surrounded by states that have expanded gaming.

“I am just one guy with several employees, but if we had gaming in Texas, so many more jobs would be available,” stated Pish. “We’re not just talking about racing; jobs at farms, feed companies, tack shops, veterinary clinics. It’s unbelievable how much money is going out of state. If legislation passes, the equine and racing economy would benefit, and a huge number of people in our industry would not have to make their living out of state.”

Dan Fick is executive director of Texas H.O.R.S.E, an organization comprised of breed organizations including Thoroughbred, American Quarter Horse, Arabian, Cutting Horse and American Paint Horse Association. They support VLTs at racetracks as a needed revenue boost to the state’s breeding and agricultural industries. They have also been working diligently to introduce and pass legislation to help Texas regain its leadership position within the American horse industry.

“Our numbers are down 50 to70 percent across the board involving foal crops, stallions and race dates,” states Fick. “Bordering states, fueled by racinos, paid out $215 million in purses in 2011; Texas horsemen ran for just $24 million. It is clear to see why our horsemen are racing elsewhere.”

Texas H.O.R.S.E  has organized “Horse Week at the Capitol” April 1-5 and has asked

horse owners, breeders, trainers, jockeys, track employees and racing fans to come to Austin to make their voices heard. Members of the racing community will make the trip and walk the halls of the state capitol explaining why they need the support of their representatives and senators to get behind the bills supporting VLTs at Texas racetracks.

Fick and other organizers will make sure that everyone who comes to Austin to support “Horse Week at the Capitol” is armed with facts and figures for their elected officials.

“We have $2.9 billion exiting Texas, but we did not wait until the last minute to state our case,” adds Fick. “We have been making visits and delivering feed buckets filled with horseshoes, feed, industry magazines and other items. Our goal is for the legislators to see how many people, associations and companies are affected when Texas is denied.”

The groundwork has been laid, and the figures cannot be ignored. There is cautious optimism that lawmakers are listening and that one of the bills will successfully get out of committee and proceed to the next step.

“We are taking it one day at a time, but have worked hard to ensure that legislators know that our industry is hurting,” said Young. “Texans need to have the chance to vote on this issue.”

Once again, the race is on, and bills to give Texas racing the impetus needed to be one of the top racing and equine states in the country, have been filed. Horsemen, racetrack officials and individuals who work in and support the industry are hopeful that the 83rd Texas legislative session will move forward to level the playing field for the Texas racing industry.

For those who want to keep up with developments in the 83rd legislative session, here are helpful websites.

Texas Legislature Online

Let Texans Decide!

Texas H.O.R.S.E

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Keeneland Again Tops HANA Racetrack Ratings

Updated: Saturday, April 6, 2013 9:42 AM
Posted: Friday, April 5, 2013 9:40 AM

Keeneland Again Tops HANA Racetrack Ratings

Photo: Mathea Kelley

For the fifth consecutive year, Keeneland, which begins its spring meet April 5, topped the 2013 racetrack ratings produced by the Horseplayers Association of North America.

The HANA Racetrack Ratings are based on an algorithm designed by HANA board member Bill Weaver, a retired engineer. Using studies and empirical data directly correlated to horseplayer value and pari-mutuel handle growth, key factors including takeout rate, field size, wager variety, pool size, and signal distribution are weighted.

“The rating algorithm indicates betting value, and at Keeneland this is exemplified perfectly,” HANA president Jeff Platt said. “With no takeout rate on any bet higher than 19%, a large field size of 9.45 horses per race, and a race office cognizant of carding interesting, bettable races for customers, Keeneland came out on top once again.”

“It’s an honor for Keeneland to be recognized by HANA for the fifth consecutive year as the nation’s No. 1 track for horseplayers,” Keeneland president Bill Thomason said. “We are fortunate to have large, quality fields, and strive to offer a wide variety of wagering options and a reasonable takeout rate. We remain committed to showcasing horse racing in a way that appeals to all horseplayers and appreciate HANA’s recognition of those efforts.”

Keeneland was followed by Churchill Downs, Gulfstream Park, Tampa Bay Downs, Kentucky Downs, Sam Houston Race Park, Oaklawn Park, Hawthorne Race Course, Saratoga Race Course, and Retama Park.

The complete llist of ratings will be available at the HANA website the week of April 7.

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The Alabama-Coushatta want their casino back. The Texas horse tracks say betting on races isn’t enough. Both see expanded gambling in the state as their ticket to solvency.

Comments (18) By Casey Michel Wednesday, Apr 3 2013

Kyle Williams remembers when Texans knew his nation.

Standing along one of the few paved roads slicing the Alabama-Coushatta reservation, 90 minutes northeast of Houston, Williams, chairman of the tribal council, describes the days Texans flocked to this land. Cars streaming in at every hour. Lines of impatience snaking a quarter-mile long. People who’d never set foot on reservations, whose exposure to Native Americans was limited to Cowboys-Redskins games and reruns of The Lone Ranger, taking hours and days from their lives to visit the 10,000 acres allocated to an entire people.

Texans, visiting his nation. Bringing their money and leaving it behind. Visiting the only casino within striking distance of Houston.

“People were lined up,” Williams says, stretching his hands to imagine the size. “There were lines like this during the week as well…Everyone could see what was possible. A lot of people’s opinions changed when we had this for nine months. People that opposed us came here in support of us — especially among the outside community.”

Williams’s beige suit bunches around his shoulders and his ­sable-silk ponytail drapes across his back. He stands straight when describing the crowds who’ve now disappeared. Williams was just a slot technician at the time, charged with technical duties while the European-Americans flowed through the tribe’s entertainment center. He describes the hundreds of slots, alongside a poker and blackjack table, turning a tribe nearing bankruptcy into a nation flipping $1 million in revenue a month.

The Alabama-Coushatta had initially voted in 1994 against installing a casino on their grounds. However, the fiscal impact on Texas’s Kickapoo and Tigua tribes swayed dissenters. “We saw the big impact [gaming] had on Indian communities,” Williams says. “And not only Indian communities, but surrounding areas, too.” A subsequent vote, taken in 1999, showed two-thirds of the tribe in favor of gaming, and in late 2001, the first slots were installed. Gambling, and a $1 million-per-month rake, had come to the Alabama-Coushatta.

And then one day nine months in, it was gone. Three hundred employees let go. The largest source of income the tribe has ever known, forced to close by legislation and lobbyists seeking to coax those casino-goers to Louisiana and Oklahoma and New Mexico.

A federal court had ruled that the Alabama-Coushatta had violated the terms of their recognition, which, as argued by then-Texas Attorney General John Cornyn, stated that all gaming prohibited by the state of Texas was “hereby prohibited on the reservation and on lands of the tribe.” The challenge came with the full-throated ­support of Texas’s evangelical population, spurred on by a now-­notorious lobbyist named Jack Abramoff. (Ironically, the Alabama-Coushatta remain a heavily Christian community and even forbade alcohol at their former entertainment center.)

“We already knew that when we opened, we were going to be in litigation,” Williams continues. “We were prepared for that.” The ­Louisiana-­Coushatta, a related tribe just one state over, had been concerned about consumers opting for their Texas cousins and ended up enlisting the aid of Abramoff, the fedora-topped lobbyist later sentenced to nearly six years for conspiracy and tax evasion in 2006.

While secretly disparaging the Native Americans as “stupid mofos,” “monkeys” and “fucking troglodytes,” Abramoff used Christian connections in Texas to mobilize anti-casino forces. Through shell corporations and blatant corruption — Abramoff and his partner are believed to have received a total of $85 million from their Indian clients — the lobbyist managed to muster enough opposition to shutter the casinos of both the Alabama-Coushatta and El Paso’s Tigua tribe in 2002. Less than a year in, the Alabama-Coushatta’s best modern opportunity for self-sustenance collapsed.

With equal parts gall and venality, Abramoff then approached the Alabama-Coushatta with an offer to restore their casino but was found out before he could swindle more Native-American money.

“It was devastating,” Williams says, his voice moving slowly through the subsequent drop-off. “Everyone could see what was possible — at the time, when we were open, we were one of the highest-paying employers here in the surrounding area.”

A visitor asks Williams about Abramoff, but the chairman claims the name provokes no reaction on the reservation. Nobody brings him up. No one thinks about him. But it’s Abramoff’s work — his choice to blinker both Texas legislators and tribes — that ended the only casino the Alabama-Coushatta have ever known. It was Abramoff’s slimeball politics that forced the Alabama-Coushatta to revert once more to smoke shops and land cultivation as their sole, and depreciating, sources of income. It was Abramoff’s grease-stained fingerprints, his choice to skim the profits and to try to lobby both for and against the tribe’s casino, that directed Williams and his people back onto Washington’s dole.

That was more than a decade ago. In the interim, the tribe, which sued Abramoff and settled out of court in 2007, has sunk nearly $3 million into attempting to change the federal language prohibiting its casino. The people have limped on with federal aid and HUD housing. The tribe has watched its ranks grow — there are now 1,150 full-blood members — but has resources enough to support only 600 on the reservation, while 80 families wait to move onto the land.

Loblollies and vines drape and smother part of the former tourist facilities. A lone Big Thicket train lies dormant, corralled by unkempt undergrowth. The nearby campground, surrounding a calm cerulean lake, seems as empty as the rest of the reservation.

And Williams can only offer so much relief. He can only carry so much pride when describing the local government-store building. He can only force a smile when describing the temporary thin-sided houses planted beside the dirt roads. There is only so much he can do for his people.

Which is why Williams — along with the few nearby cities that still know the Alabama-Coushatta exist — is pouring everything he can into bringing the casino back to his land. Flying to Washington, DC. Trekking to Austin. Talking about forgoing a 2002 federal court-awarded $270 million (to the tribe for the historic loss of their land to the U.S. government) — not yet dispensed — just to reopen the small casino his tribe once maintained. Asking those he can to allow his people the business they once knew and for the fairness that most other states enjoy.

Because if 240 other tribes across the nation can game and Texas can still allow a casino for the Kickapoo, why is it that the Alabama-Coushatta have to continue with a burned-out amphitheater and overgrown shacks? Why are they the ones who can’t reap the benefits that hundreds of other tribes across the country now know?

“We were once told the Kickapoo lived under a bridge in little shacks, and now they’re putting forward a $90 million renovation,” Williams says. “It didn’t only impact the tribal community — it impacted the surrounding community…Our casino gave us a sense of hope.”

A bill has finally been presented during this legislative session that seeks to revive the Alabama-Coushatta’s casino. And if certain observers are to be believed, and if the necessary steps are met, Houston could soon find itself with a full-blown casino just beyond its northeastern reaches. After all, if video lottery terminals, which some consider Class III gaming, are also legalized at local horse racetracks — another possibility during this legislative session — the Alabama-Coushatta could eventually petition to have their slots returned, along with whatever additional games they’d like.

Roulette and craps. ­Baccarat and poker.

“It’s a basic issue of fairness,” says Jim McGrath, one of Williams’s advisers. “There’s one tribe in the state of Texas federally recognized to game and another here that cannot. Before you even get into the economics, it’s about basic fairness.”

Naturally, much has changed in Texas since the entertainment complex’s closure. Awareness of the Alabama-Coushatta’s casino — publicity for which existed only through word of mouth, according to Williams — has faded. People have moved on to other forms of entertainment; it’s entirely possible that the casino’s return would face an indifferent populace.

However, if Let Texans Decide, a lobbying organization dedicated to expanding gambling options in the state, is to be believed, Texans are as dedicated to the concept of gaming as they’ve ever been. Citing a formula that combines information provided by state gaming commissions and field research, Let Texans Decide, founded last year, says that Texas hemorrhages some $2.96 billion annually to neighboring states, with the bulk going to Oklahoma and Louisiana.

“Now, I’m not mad at those states — I think they’re smarter than we are and that they’re using a lot of Texas money to fund lots of programs,” says John Montford, a former state senator and current spokesman for Let Texans Decide. “There’s no way we can compete with them financially…They’ve contributed millions of dollars to the Texas Legislature, which is a whole lot more than they’re contributing in their own states. My hat’s off to them — they’re very cleverly positioned to enjoy Texas’s largesse.”

While critics can paint Let Texans Decide’s formula as a statistical head-fake — after all, the casinos, not the state, would take the lion’s share of the profits — there’s scant dispute that Texans are as susceptible to gambling as the rest of the nation. In addition to the numerous buses running daily from Houston and Dallas, there’s little that better illustrates this financial osmosis than the parking lots at WinStar World Casino, in Thackerville, Oklahoma, and L’Auberge du Lac, in Lake Charles, Louisiana, packed bumper to bumper with Texas license plates.

“What just gets my gall is that when you drive to Louisiana, 75 percent of the people there are in Texas cars,” says Hal Wiggins of Houston, who trained filly ­Rachel Alexandra, winner of the 2009 Preakness Stakes. “My blood gets boiling. It’s gotten to the point where I don’t even like to look at license plates.”

The survey that Let Texans Decide cites actually paints a bleaker portrait — it claims that 90 percent of those frequenting the Oklahoma casinos carry Texas plates — but the point stands: While Texas remains one of the few states without any form of large-scale casinos, Baton Rouge and Oklahoma City continue to line their budgets with Texans’ cross-border economy. Schools, roads, law enforcement — all that infrastructure, buttressed because Austin isn’t willing to allow the kind of gaming many constituents clearly want.

A pair of Senate bills, however, have been proposed that would alleviate some of the pressure that’s sending gamblers to Lake Charles and the Chickasaw Nation. The first, sponsored by Sen. John Carona, would allow the Alabama-Coushatta the tribal casino they once knew, so long as the federal language prohibiting it likewise changes. The second, filed by Sen. Juan Hinojosa, would also attempt to legalize VLTs at the state’s 13 licensed racetracks.

As both measures seek to expand gambling, however, the Legislature wouldn’t be the only group deciding on such growth. Any gaming extension would require constitutional approval, needing 100 House votes, 21 Senate votes and, as early as this fall, majority support from Texas ­voters.

True to its name, Let Texans Decide has published multiple surveys showing that upwards of 85 percent of Texans would prefer to vote on the matter. That’s not to say that there’s 85 percent support on expansion as such; rather, it means that Texans, who those on either side of the debate consistently assure us are the finest people in the nation, would prefer direct democracy instead of the small-r republicanism they currently enjoy.

“Texans don’t like to be told what they can or can’t do with their money,” Montford observes. “Texans are sophisticated, independent, freethinking folks. What’s wrong with a vote of the people?”

Even then, it’s not simply the license plates and improved infrastructure that gambling proponents cite as reasons for expansion. Illicit eight-liners still flourish in Texas, so there’s support to legalize and regulate them. And the entire ban smacks of nanny-statism, flying in the face of Texans’ purported independence. Banning gambling — like barring drugs and prohibiting prostitution — forces it underground, shovels it elsewhere. Nothing is stopped. Things are merely shuffled.

These attempts at legalization have been coming ever since the Texas Lottery was created in 1991. None have ever achieved a two-thirds majority in the legislature, and none have ever been put before the state’s voters. And if such measures couldn’t pass in 2011 — when Texas was facing one of its worst budget crunches in recent memory — there seems little impetus to pass anything in 2013 with the state flush and rolling.

But then, as Oklahoma and Louisiana continue to dredge Texans’ pockets, the reality persists that the state has plans to reinstate only part of the $5.4 billion hacked from public education in 2011. Any talk of a tax hike blanches legislators and voters alike. Suddenly, gambling expansion looks more palatable than at any previous point.

“As I move around my district, more and more folks tell me to please support [gambling expansion],” says Democratic state Rep. Joe Farias. “This year has probably had more buzz about voting on a gambling bill…We’re trying to find a funding mechanism for public education and for the other agencies that took a hit. And public education has been the big driver for it.”

The Alabama-Coushatta and the public-­education backers aren’t the only factions pushing for gaming extension. For while the tribe and the schools will continue to exist, though with fewer resources, there’s no guarantee that the world of Texas horse racing — and more generally, the state’s equine industry — will endure in any recognizable form if it doesn’t land the slots it seeks and soon.

It’s no secret that horse racing in Texas has shed both business and prestige over the past decade. While there are few industries that carry more cultural import, few that are closer to the state’s heart — what is a cowboy without his steed, anyway? — the same states stealing Texas’s gambling dollars are also swiping the state’s horse-racing monies. As Texas tracks are forced to make due with decreasing handles, breeders and owners and trainers have spent the past decade shipping their horses to parks that offer additional gaming, standing just beyond Texas’s borders.

“I want to run in my hometown, to support Texas racing, but at the end of the day you have to do what’s right for your business,” says Bill Casner, an owner who worked with 2010 Kentucky Derby Winner Super Saver. “There’s no incentive to have a Texas-bred horse now, because it’s next to worthless, especially compared to Louisiana-bred, Oklahoma-bred, New Mexico-bred. They have no value.”

Montford, originally from West Texas, noted that the most surprising aspect of his recent tours has been witnessing the depths of the drop-off in Texas horse breeding. “I’m from West Texas, so [you see] the virtual decline of the horse-­breeding industry,” he says. “You’ve got breeders going to where they can try to do better. And I was frankly shocked to learn that across Texas, everywhere I go, breeders are leaving the state.”

“The neighboring states have so successfully used their gaming to cannibalize our population and funding and everything else,” says Dr. Jackie Rich, a veterinarian and president of Texas HORSE, an organization attempting to expand gambling options on racetracks. “Our breeders and owners have to go where the money is. It’s just decimated the entire equine industry of Texas. It’s dying.”

The numbers seem to justify the cynicism facing the industry. According to data shared by HORSE, race dates have dropped by 46 percent over the past decade. In the same time frame, purses have dropped by more than half. The foal crop has collapsed by nearly 60 percent. Everything — the mares, the thoroughbreds, the entertainment — has headed elsewhere.

“It doesn’t take long to get this circular process going,” says Dan Fick, executive director of Texas HORSE and former executive director of the American Quarter Horse Association. “The more money you have for purses, the better horses you’re going to get and the more money will be wagered because they’re better quality. [How] do you get people to come to Texas to race? You don’t. The people still racing are the people who are already here and maybe some others who can’t be competitive in other states. But the industry will continue to decline.”

And it’s not simply those who’ve remained, those who have seen their ranches and race parks degrade, who have noted the drop-off. According to Casner, who grew galloping horses on the far side of El Paso before relocating to Kentucky, Texas has all but damned its equine industry by preventing any additional gaming at parks. “It’s like you have three smartphone stores surrounding Texas, and we’re still selling flip phones,” Casner says. “And, hey, you know what — who are those states supported by? Texas ­residents!”

While the states surrounding Texas do maintain large-scale casinos, most of their take comes from slots and VLTs. That is, Oklahoma and Louisiana and New Mexico have decimated Texas’s horse racing through video games, allowing the consumer a secondary style of gaming between, or in addition to, the races.

Other states have been in the situation in which Texas currently finds itself, surrounded and disintegrating. Kentucky, another state noted for its equine history, was pinned between states offering additional gaming. According to Corey Johnsen, president of Kentucky Downs, the state granted a couple of parks video-game-style entertainment — a take known as “historic racing” rather than traditional slots — only in late 2011. In the 19 months since legalization, the two tracks involved have seen their revenues increase 500 percent.

“Frankly, Texas should be at the top,” says Johnsen, the former president of Grand Prairie’s Lone Star Park. “It has everything: the land, the horseman, the heritage. The infrastructure is there. [But] it’s virtually impossible to compete there…It has no alternate forms of gaming, and virtually every state has something.”

Just to be clear, though, this isn’t some distant, localized West Texas phenomenon. Every county and innumerable Texans have been affected by the drop-off in the equine industry. “When you see people that had been at your farm for eight years, and you see them at a horse sale or the racetrack, the conversation is always the same: They had to go where the purse money was,” says Danny Shifflett, 77-year-old manager at Hempstead’s Lane’s End Texas Stallions. “We’re sitting here with the most potential of any state in the Southwest, but all we’re doing is supplying the other states with support and revenue.”

Despite the ostrich races and the country concerts, Houston’s Sam Houston Race Park has fared no better. President Andrea Young says hundreds of jobs have been lost since she took over six years ago. And the potential legislation — the potential legalization of VLTs — is about jobs and the potential to save the ones that are still going to be cut. According to a 2011 survey by TXP, an Austin-based consulting firm, Texas would generate nearly 80,000 jobs and $8.5 billion in “economic activity” should racetrack slot machines be implemented in 2013.

Still, Young doesn’t want to make VLTs into something they’re not. The machines won’t be a panacea. They’re barely even a start. “It’s a Band-Aid — it’s mouth-to-mouth resuscitation, not a solution,” she says. “It’s not even getting us out of the emergency room.”

But they’re something. They’re better than the current reality, better than the situation that all but encourages the investors and the owners and the bettors to uproot for states that provide as much gambling as people want. VLTs may not recoup the losses incurred over the past decade, but they appear to be the only shot the horse industry has at beginning a path back to relevancy. “I’m no optimist about it at all,” Casner states. “It would shock me if sanity prevailed. It would just shock me…I don’t think the Texas Legislature really gives a damn about the Texas horse industry.”

And perhaps they don’t. Or maybe they’ve staked out a position from which they can’t hide. Because there, written starkly in the Texas GOP’s 2012 platform, is a promise, verbatim, to oppose any potential extension of gambling:

“We oppose the expansion of legalized gambling and encourage the repeal of the Texas State lottery. We oppose dedicating any government revenue from gambling to create or expand any government program.”

This is the platform to which the majority of both the Texas House and Senate have pledged support. This is the platform for which the majority of Texans voted in 2012. This is the platform upon which, contra Montford’s calls, the majority of Texans have already decided.

“On the whole idea of letting people decide, I tell folks that people get the chance to decide already,” says Rob Kohler, the leading lobbyist opposed to gambling expansion. “You’re basically disenfranchising people who’ve already participated in the process.”

Kohler, who works with the Texas Baptist Christian Life Commission, will affirm to anyone who listens that Texas’s electoral model is the “gold standard” of democracy. Any further slide toward pure democracy runs counter to this state’s politics. “What about people who’ve already voted?” he asks. “What about people who’ve already chosen? Everyone has a right to participate, but don’t try to trick people.”

This focus on prohibiting gambling is twofold. First, there remains a moralistic component — the same strain that opposes same-sex marriage, abortions, et al. — that the Right cites. “I think there’s a moral component,” says Cathie Adams, president of the right-wing Texas Eagle Forum. “I do call [gambling] a vice, and morally it is wrong to put upon those who you know cannot best provide for their families already. So many people may think that the streets are lined with gold in Texas.”

Families break. Children learn improper ethics. The Christian God stands displeased. And on it goes.

But this opposition to gambling doesn’t stem just from the same religious component that keeps certain counties dry. Rather, the past two decades of experience with the Texas Lottery have shown detractors what can happen when, as they see it, gambling infiltrates the system and begins to prey upon the weakest.

Kohler, who worked with the Texas Lottery for nearly a decade, points to recent survey data shared by the Texas Lottery Commission. Conducted by the University of Houston’s Hobby Center for Public Policy, the TLC’s 2012 demographic study shows that 61 percent of those participating in the Lottery are white, with 13 percent of participants black and 21 percent Hispanic. It also states that more than 40 percent of those participating have either a college or a graduate degree.

However, while this jibes with certain imagery in recent Texas Lottery advertisements — see the recent television commercial with the well-heeled Caucasian man doing his prototypical white-guy dance — it remains strongly misleading. The TLC survey pool stood at 62 percent white and 19 percent Hispanic — even though, according to the 2010 Census, the state’s demographic makeup stands at 45 percent white and 38 percent Hispanic. (The black population remained constant in both surveys.)

The educational discrepancies remain just as stark. While 41 percent of TLC respondents had either college or professional degrees, in reality, according to the Census’s American Community Survey, only 32 percent of Texans have actually attained such educational levels.

“One of the things that time and information did for me is change my opinion because of the predatory nature of the Lottery in maintaining the amount of funds it sends to the state budget,” says state Rep. Garnet Coleman, who represents one of the lower-income districts of the state and is one of the few Democrats who oppose gambling expansion. “People are seeing stars and glitter as opposed to the negative side that comes with casino gaming. People have to go in with eyes wide open.”

Kohler’s supporters also claim that the Lottery has misappropriated profits and misled legislators, but representatives of TLC vociferously dispute the claim and point to the $1 billion the commission annually generates for public education. “While we respect folks like Mr. Kohler and his viewpoints, and anyone that has sensitivities about any form of gaming, I’ve not ever really heard another solution for providing that $1 billion,” says TLC spokesperson Kelly Cripe.

Still, time and information have also begun denting the other gambling methods recently cited by expansion supporters. In Kentucky, for instance, a case has been appealed to the state Supreme Court challenging the legitimacy of the additional gaming systems that have recently helped revive the state’s equine industry.

“They’re basically slot machines,” Kent Ostrander, executive director of the Family Foundation of Kentucky, says of the historic gaming machines. “The government should not make its citizens losers in order that it can be a winner — government should protect its citizens. When the state is on the cusp of issuing [gambling] licenses, what they’re actually doing is issuing hunting licenses for the wealth of its citizens.”

But these are broad, somewhat specious issues. Moralism is intangible; the Texas Lottery is a government-run game and subject to attendant scrutiny. If and when the Alabama-Coushatta and racetracks land their gaming, individual Texans — individual Houstonians — will be the ones to gain and suffer and triumph and collapse. Gaming options will proliferate. Gambling addiction will likely swell alongside.

“[Of all types of gambling], video gaming is the most addictive,” says Bob Cabaniss, executive director of Virginia-based Williamsville Wellness, one of the nation’s more notable treatment facilities. “It’s the fastest, and with old slot machines you pulled a handle, and now you just push a button. The more access…the bigger the problem’s going to be.”

As for the revenues that could be generated and the potential for an educational boon: “It’s always to help schools. Everything’s to help schools,” Cabaniss muses. “It’s almost like blood money — we spend this money and we’re good guys.”

“It’s interesting to see who’s for it and who’s not and why,” says state Rep. Lance Gooden, one of the few Republican members of the House who say they’re willing to send the vote to their constituents. “None of it’s for moral reasons — it’s 100 percent about money.”

Houston, of course, is no different from any other megalopolis, any other population center, with its gamers and addicts and victims. These are people in all castes. Gambling abuse doesn’t settle on any particular ­demographic.

For example, one local gentleman, now offering his story to anyone calling Gamblers Anonymous for help or information, knew the Alabama-Coushatta’s casino well. This man, whom we’ll call Dan, was a white-collar six-­figure type. Never gambled much in his youth, never really bet in his young days of risk and hormones. And then he grew, and he married, and his children left for school, and his wife left for work: And something broke. Suddenly, golf wagers jumped. Suddenly, errands turned into runs to underground eight-liners. Suddenly, business trips were redirected to the fluorescent haze of Oklahoma and Lake Charles and Las Vegas.

Dan hit an early run that hitched him to the gambling he’d never known. “I became one of the idiots I used to shake my head about,” he says, repeating the story he shares with those who call. “Gambled every day that I could. If I wasn’t gambling, I was thinking about gambling or how to get the money to gamble, or thinking about how to get the money back that I’d begged, borrowed or stolen.”

A quarter-million in debt. Employer credit cards lifted and lost. Phantom accounts opened in his spouse’s name. And lying. Lying every day. Lying to every person, to every neighbor and partner and loved one that he knew.

“There never seems to be a winning big enough to make the smallest dream come true,” Dan says. “All these lies are directed toward allowing us to continue to gamble. When we lose, we gamble; when we win, we keep gambling. We can’t stop. We’ve lost the ability to stop.”

Years passed and bank accounts buckled. His employer began asking questions. Dan lied, knowing he could risk one final run, one final rush. He had $600 remaining — blew half of it on the drive to Louisiana. He got to the casino. Parked, walked in. Looked for whatever was closest to the door. Poker it was.

“Best cards I ever got in my life,” he remembers. “I lost everything. Lost straights, lost flushes, lost full houses. The only hand I remember winning was when everyone else folded.” But that fold was early; the losses came after. His wallet — his accounts, his options, his head — was empty.

It was 4 a.m. by the time Dan walked back to his car. The lot had thinned, but not by much. A neon sign buzzed above: “Texan Wins $1 Million!” He smiled wanly. Not this one.

Dan opened his trunk and pulled out a rifle. One bullet in the chamber. One bullet in the chamber for years. Dan put his head on the roof, felt the cool morning metal on his cheek. The barrel met his eye. Circle to circle. Exit to entry. “God, forgive me for what I’m about to do.” The neon light flickered above, and his thumb reached for the trigger.

A thought slid in from nowhere he recognized. “The first rational thought I’d had in years,” he says. A thought to confess. A thought to amend and to open up to those who’d sniffed and guessed and discovered the threads of lies slithering through every relationship he knew. Honesty held his thumb and dropped it. Dan climbed in the car and drove back.

After 50 days in prison and a decade of probation — after losing anything he’d held close — Dan has found work as a builder, tying his college degree and executive background to the drywall he now hangs for a living. He hasn’t seen a single casino since he joined Gamblers Anonymous. He hasn’t laid a single bet, even though each day is as exhausting as the previous one.

“It’s probably the easiest condition to hide, compulsive gambling — the only people you have to hide it from are the ones closest to you and the ones that want to believe you, ” Dan says. “I saw this one study that asked why compulsive gamblers gamble, and one scientist said it was for the money. He couldn’t be more wrong.”

A boarded-up hotel sags on the eastern side of Livingston, the town nearest the Alabama-Coushatta’s reservation. Weeds and overgrown pampas wrap the warped cyclone fence. A lone black cat scurries across the balcony, the only sign of life in a bloated, bleached building. “Local cities, they started booming,” Kyle Williams says, recalling what his people’s casino brought. “Hotels and restaurants were everywhere. And once our complex shut down, those went out of ­business.”

Indeed, the Alabama-Coushatta weren’t the only ones benefiting from the casino. Of the 300 people employed, only 80 were Native Americans — the rest came from nearby towns. The fiscal ripple didn’t end at the reservation line. And now, touring the outer rings of Livingston, you can see the crater left by the casino’s ­closure.

The tribe, however, hasn’t forgotten its neighbors — after all, Sam Houston originally demarcated the Alabama-Coushatta’s land because of their aid in the Texas Revolution against Mexico. Even though their revenue collapsed following the end of gaming, the Alabama-Coushatta have continued to maintain the region’s only Head Start program, with 90 percent of the children bused in from non-reservation lands.

But now, with meager revenues and looming sequestration cuts — Williams says 8-10 percent of the tribe’s budget will likely be axed as a result of falling federal funding — the Head Start program, one of the oldest in the nation and one of the jewels of the tribe’s infrastructure, looks to take a large hit. “We used to be able to ask for the things we would need,” says Billie Sue Williams, the program’s director. “But with the budget we have, we now have to think twice.”

Kyle Williams, as it stands, was a product of this Head Start program some 30 years ago. And he now runs a nation. And he’s pushing for legislation that will be, he says, a lifesaver. He stands tall — while a tribal boy with a gap-tooth smile, a black girl with pigtails and a Hispanic boy in a pink Superman cape squeal past his legs — and says that there’s little that can help more than, of all things, gambling.

It’s the same as the rhetoric from those in the equine industry. It’s similar to the rhetoric of those who want to see public schools buoyed without a consequent tax hike. And if polls are to be believed, it’s an idea that nearly nine in ten Texans would like to decide on for themselves. It’s rhetoric that the state has heard for a decade and that might finally catch on.

“Most Texans I know don’t need guidance from any organization to figure out how they think and what they want to do with their money,” says Montford. “I’ll fight to the bitter end to let others campaign against it, but let’s not let a bunch of organizations that feel like they’re smarter decide.” And now that we’re here, in 2013, with decades of attempts and momentum pitching forward, Montford is blunt. “I’m in it for the long haul. But I kind of like the odds.”

 | Categories: Uncategorized |

By Let Texans Decide

Published: Tuesday, Apr. 2, 2013 – 9:09 am

AUSTIN, Texas, April 2, 2013 — Texans Responsible for 38.6% of Total Gaming Revenue in Oklahoma, Louisiana and New Mexico

A new study released by a leading Texas-based economic group, TXP, shows neighboring states are taking Texas to the cleaners through legalized gaming. Texans are responsible for $2.96 billion in annual gaming revenue in those three states – up $590 million since a 2009 study — and in both Oklahoma and Louisiana represent more than forty percent of their customers.

“Texans are gambling in large numbers in neighboring states, and especially at casinos and tracks close to the Texas border,” said TXP President Jon Hockenyos. “We compiled facility-specific data when available from neighboring states, along with surveying thousands of license plates, to arrive at our central conclusion: Texas gaming dollars are a lucrative prize for neighboring states.”

TXP determined that while Louisiana, Oklahoma and New Mexico represent three percent of national personal income in 2011, they were collectively home to 11.7 percent of national gaming expenditures. When money spent by Texans on food, lodging and other amenities is added to money expended on gaming, Texans spend $4.37 billion each year on gaming trips to Oklahoma, Louisiana and New Mexico.

Gaming facilities closest to the Texas border received an abundance of Texas visitors, as evidenced by this chart.

“Texas is hemorrhaging money and our horse industry is under assault while tracks in other states with expanded gaming offer more lucrative purses,” said John T. Montford, chairman of Let Texans Decide. “We offer a simple proposition: let Texans decide if they want to keep their dollars in Texas to the benefit of our state.”

Bi-partisan legislation has been proposed in both the Texas House and Senate that would let Texans vote on expanded gaming and puts our horse industry on a level playing field.

SJR 64 by Senator John Carona would expand gaming at existing dog and horse tracks, and allow for the creation of a limited number of destination, resort casinos.

SJR 36, authored by Senator Juan “Chuy” Hinojosa, would allow dog and horse tracks to add slot machines.

HJR 121 by Representative Richard Raymond, also would allows slots at existing tracks.

For more on the TXP study, including an executive summary, please visit

 | Categories: Uncategorized |

By Tim Eaton -American-Statesman Staff
Posted: 7:34 p.m. Friday, March 15, 2013

One of the groups that had been pushing for full casino gambling changed its strategy late in the game and is now asking lawmakers to approve a simpler measure to allow slot machines at racetracks.

Let Texans Decide, a pro-gambling organization that is fronted by former state Sen. John Montford, was aligned at the beginning of the 2013 legislative session with big casino interests in a call for full-scale casino gambling in Texas, whether at horse and dog tracks or at yet-to-be-built destination resort casinos.

But as the session progressed, the chances of passing a measure for casino gambling appeared to grow slimmer. And now, Montford’s group, which advocated legislation in 2011 to permit slot machines at tracks, has returned to its old way of thinking.

“This was the position we originally took,” Montford said. “I do believe that this is a reasonable approach.”

The goal has always been the same: to get a gambling-related bill through the Legislature and have the matter put in front of the voters of Texas, the former senator said.

Expanding gambling in Texas — whether slots at tracks or full-blown destination casinos — requires clearing a high hurdle. Two-thirds of the Legislature must vote for the concept, and then voters across the state would have to approve a change to the state constitution.

With an apparent lack of appetite for casino gambling at the moment, Montford’s group was left to advocate existing bills that would allow video lottery terminals, basically slots machines, at racetracks around the state. (The measure also says Indian tribes are not prohibited from providing games of chance on certain Indian lands.)

The measures now backed by Montford’s group have been supported already by other racetracks that are not part of Let Texans Decide.

While it is always difficult to gain approval for gambling legislation from the Texas Legislature, some factors at play now could help, Montford said.

For one, there is growing support among Republicans in the House for slot machines at racetracks, he said. Recently, John Kuempel of Seguin and Rep. Ralph Sheffield of Temple signed on to a slot bill by Rep. Richard Raymond, D-Laredo. Montford said he was encouraged that more members are willing to allow constituents to vote on a gambling initiative.

Montford is also happy that a slots-at-tracks measure by Sen. Juan “Chuy” Hinojosa, D-McAllen, has been assigned to the Senate Finance Committee, where more senators could hear the testimony.

To many political observers, last session, with its $27 billion budget shortfall, seemed to offer the best chance in years to pass gambling legislation. The promise of adding billions of dollars to the state tax rolls gave gambling interests hope, but by the end of the session, it was clear that the bills would not go anywhere.

This session, a much rosier budgetary situation (thanks to expanded oil and gas revenue) has left a lot of gambling proponents — other than Montford — less than optimistic about passing a bill.

The other players in the game, notably the big Las Vegas casino companies, might be quiet now, but that doesn’t mean they have lost hope in the long run.

Some gambling proponents could see an opportunity if there is a special legislative session, as expected, focusing on financing public schools.

If lawmakers are scrambling in a special session for new money to comply with an expected court order to put more money into education, then casinos are “more optimistic for serious consideration,” said John Pitts, a lobbyist for several large casino interests.

But there will always be opposition.

Rob Kohler, consultant and lobbyist for the Christian Life Commission of Texas Baptists, said the Montford group has a real problem on its hands now, and switching its message won’t help.

“It doesn’t improve the chances of any piece of legislation passing,” Kohler said.

 | Categories: News |

Republicans are signing onto bills they previously opposed.

WOAI Local News – Monday, March 11, 2013

Several casino gambling measures will come before Texas House committees this week, and supporters say there is a growing sentiment that the voters, and not the Legislature, should  make the final decision on the question of expanding gambling, 1200 WOAI’s Michael Board has learned.

“What everybody, especially Republicans, are becoming more comfortable with it, let’s let the voters decide,” State Rep. Richard Raymond (D-Laredo) told 1200 WOAI news.

Raymond, who is backing several bills to expand gambling in the state, says he has never seen this type of sentiment among Republican lawmakers.

Gambling measures have stalled for years, never getting out of committees, let alone before the people for a vote.  But several factors are credited for changing attitudes toward casinos.

One is the active work of former State Sen. and Texas Tech University System Chancellor John Montford, one of the most respected former lawmakers, and a prominent conservative.  Montford heads Let Texans Decide, a non partisan group which is lobbying lawmakers on both sides of the aisle.

Another is a continuing drumbeat of reports about the success of gambling in neighboring states.  Oklahoma just last month announced that casinos in the Sooner State raked in $3.48 billion in revenue in 2011, up 7.7% over 2010.  A large percentage of people playing casinos in Oklahoma and in Louisiana are from Texas.

“Every Legislator is convinced that we are losing $3 billion to $4 billion a year to surrounding states,” Raymond said.

The new reports may be breaking down a major argument of casino opponents.  For years they have questioned figures showing Texans spending billions in states like Louisiana and Nevada, and pointing out the sluggish economies of those states, Nevada continues to have the highest unemployment rate and the highest percentage of homes in foreclosure of any state in the USA.

Let Texans Decide says approving casino gambling in Texas would lead to the immediate creation of some 75,000 new jobs, and would mean an $8.5 billion boost to the state’s economy.

They also point out that the Texas pari-mutuel racing industry is fading, because tracks in neighboring states also provide casinos and other gambling along with the ponies.

“I certainly believe there is two thirds support in the House and the Senate to take it to the voters,” Raymond said.  “I haven’t really seen that before.”

Social conservatives continue to oppose expanding the footprint of casinos in Texas, claiming that the ‘hidden cost’ of broken families, problem gambling, and crime would far outweigh the benefits.

Some of the bills currently up for consideration would simply allow existing pari-mutuel tracks to establish ‘no live dealer’ video poker and slot machines.  Some would legalize the devices known as ‘Eight Liners.’  But some bills, like the one sponsored by State Sen. Rodney Ellis (D-Houston would allow the establishment of full blown Vegas-style report casinos in San Antonio and other major cities, as well as on Galveston and South Padre Island.  These would be major facilities, with a $400 million minimum investment.  Just the application fee to obtain one of these casino licenses would be $50 million.

The bill would also establish a Texas Gaming Commission to regular the casinos.

All of the bills require that Texans be allowed to vote on the issue.  The major casino bills, like the one sponsored by Ellis, go even further, requiring a general statewide Constitutional Amendment election to allow casinos generally, and then requiring that voters of the city or county where a casino would be located vote on the proposal on the table.

As a Constitutional Amendment, Gov. Perry’s support would not be necessary.

 | Categories: News |

By: Fox San Antonio Staff

Monday, March 11 2013, 12:53 PM CDT

Voters could soon have the right to decide whether casino gambling in Texas becomes legal.

Local State Representative Jose Menendez introduced a resolution to create a constitutional amendment allowing Texans the right to vote on casino gambling.

According to a press release from Menendez’s office, Texans spend close to 4 billion dollars each year in casinos in neighboring states.

The resolution presented by Menendez would dedicate proceeds to the Permanent School Fund and the Texas Education Grants program for higher education.

Once fully implemented, the legislation would provide an estimated $800 million for public schools and upwards of $50 million into college scholarships for Texas students.

Menendez says more than $400 million in revenue would be generated through up-front license fees and would immediately go towards education funding.

 | Categories: Uncategorized |

Oklahoma Indian gaming produced nearly $3.48 billion in revenues in 2011 — a 7.7 percent increase over the previous year.

By Randy Ellis | Published: February 27, 2013- NEWSOK

Oklahoma Indian gaming produced nearly $3.48 billion in revenues in 2011 — a 7.7 percent increase over the previous year’s total of $3.23 billion, according to a report released early Wednesday by a California economist.Oklahoma’s 2011 Indian gaming revenue growth rate was more than double the 3.4 percent national Indian gaming growth rate, according to the 2013 edition of Casino City’s Indian Gaming Industry Report by economist Alan Meister, of Nathan Associates Inc.

Nationally, Indian gaming generated about $27.43 billion in 2011, Meister reported. Read More

 | Categories: Uncategorized |

The Kaw Nation is planning to open a totally smoke-free casino this spring at its tribal headquarters in Kaw City as the state’s Indian gaming industry continues to expand. Oklahoma Indian gaming produced nearly $3.48 billion in revenues in 2011 — a 7.7 percent increase over the previous year.

By Randy Ellis | Published: February 27, 2013- NEWSOK

Oklahoma Indian gaming produced nearly $3.48 billion in revenues in 2011 — a 7.7 percent increase over the previous year’s total of $3.23 billion, according to a report released early Wednesday by a California economist.Oklahoma’s 2011 Indian gaming revenue growth rate was more than double the 3.4 percent national Indian gaming growth rate, according to the 2013 edition of Casino City’s Indian Gaming Industry Report by economist Alan Meister, of Nathan Associates Inc.

Nationally, Indian gaming generated about $27.43 billion in 2011, Meister reported.

Oklahoma tribes also generated about $493.4 million in nongaming revenue from patron expenditures on food, beverages, lodging, shopping and entertainment at gaming facilities in 2011, Meister said. That was a 7.9 percent increase over the previous year.

Casino City is just now reporting revenue data for 2011 because of the time required to gather, analyze and publish the report.

Kaw Nation casino

The report did include more up-to-date information on recent and planned expansions, including the Kaw Nation’s plans this spring to open a 100 percent nonsmoking casino in Kaw City, about 15 miles northeast of Ponca City.

Pam Shaw, general manager of casinos for the Kaw Nation, said several tribes have tried nonsmoking sections of casinos, but as far as she knows, this will be the first and only totally smoke-free casino in the state.

Shaw said people always say nonsmoking casinos won’t make money but said she has received a lot of positive comments since the tribe revealed its plans.

“I think it’s going to be good,” she said.

The Kaw Nation hopes to open the casino by the first week of April. It plans to start small with 78 electronic games, Shaw said.

If it does well, perhaps it will become a trend, she said.

Compact fee collection fell in 2011, rose in 2012

Nationwide, six large casinos opened in 2011, including two in Oklahoma — the Thunderbird Casino-Shawnee operated by the Absentee Shawnee Tribe of Oklahoma, with 254 machines, and the Golden Eagle Casino in Apache operated by the Apache Tribe of Oklahoma, with 240 machines, Meister reported.

While Oklahoma Indian gaming revenues increased 7.7 percent in 2011, the amount of fees the state received from tribal compact fees actually decreased from $122.7 million in calendar year 2010 to $121.7 million in 2011, state officials said.

Casino City’s report provided an explanation for the decrease, noting that Oklahoma tribes decreased the number of table games in their casinos in 2011 and decreased the percentage of Class III games, while increasing the percentage of Class II games.

Oklahoma Indian tribes only pay fees to the state for the operation of Class III games — Las Vegas-style electronic games — and nonhouse-banked table games, like poker.

Tribes don’t have to pay the state to operate Class I games, which include social games for nominal prizes. Nor do they have to pay to operate Class II games, which include bingo and similar games.

Some of the Class II games are played on electronic devices and are similar, in some respects, to Class III electronic games.

The number of table games in Oklahoma Indian casinos dropped from 813 in 2010 to 753 in 2011, a decrease of 7.4 percent.

The report noted that Oklahoma tribes steadily increased their percentages of Class III games from 2005 through 2008, while the National Indian Gaming Commission introduced stricter limitations on Class II games that would have made them less similar to Las Vegas-style games.

The percentage of Class III games rose from 10 percent in 2005 to 66 percent in 2008.

However, the Commission withdrew the stricter limitations of Class II games in 2008, and the percentage of Class III games has steadily declined since then, dropping to 60 percent in 2011.

Tribes did pay more to the state in 2012, however. Compact fees to the state rose to nearly $127.8 million that year, an increase of 5 percent. A state gaming oversight official attributed the increase to new casinos opening with more total games, rather than a shift to a higher percentage of Class III games.

Casinos support jobs

At the end of 2011, Oklahoma had 115 Indian gaming facilities that were being operated by 33 tribes. Those facilities housed 63,536 gaming machines and 753 table games.

Nationally, 242 American Indian tribes operated more than 341,000 gaming machines and 7,700 table games. The games were in 460 facilities located in 28 states in 2011, the report states.

Indian casinos supported about 339,000 jobs and $12.3 billion in wages, and were responsible for about $1.4 billion in payments to nontribal governments.

 | Categories: News |

By STEPHEN SINGER AP Business Writer
HARTFORD, Conn. February 27, 2013 (AP)

Indian casinos brushed off weak consumer spending in a sluggish U.S. economic recovery to post a modest increase in revenue in 2011, an industry study reported Wednesday.

Not only did revenue rise 3 percent, to $27.4 billion, but Indian casinos are holding on to their share of total casino gambling revenue, competing closely with commercial casinos, according to the report, “Casino City’s Indian Gaming Industry Report.”

The revenue increase is the second in as many years following a first-ever drop in Indian casino revenue in 2009 as the worst recession in decades took its toll on consumer spending. The back-to-back increases in revenue are encouraging, the report said.

“The question is how much further can Indian gaming grow?” author Alan Meister said.

Indian gambling was slowing before the start of the recession in late 2007 due to legislation, regulations and court decisions that restricted the types of games offered by Indian casinos, the number of states where gambling is permitted and other limits, he said.

The outlook for Indian gambling now appears healthy because the economy is expected to continue improving, restoring consumer spending, Meister said. In addition, many tribes are upgrading, expanding and replacing casinos.

Indian-run casinos such as those in Alabama and Nebraska, he said, enjoy the advantage of being closer to consumers than many commercial casinos. “They’re a good alternative to Vegas that’s closer to home,” he said.

But the long-term outlook for Indian gambling is uncertain, Meister said. Potential threats include continuing legal challenges — such as a land dispute court case in Michigan that Meister said increases the likelihood of other legal challenges to gambling projects — and state regulations that restrict Indian casinos and limit expansion. Indian casinos face “a lot more” restrictions than their commercial counterparts, he said.

“That, in some ways, holds back Indian gaming from what it could potentially be,” Meister said.

Other potential challenges include increasingly saturated markets, rising competition and Internet gambling.

Indian gambling generated about 43 percent of U.S. casino gambling revenue in 2011, the report said. Revenue at commercial casinos was 45 percent and revenue from racinos — casinos that operate at race tracks — accounted for the remaining 12 percent. That’s unchanged from 2010, but represents a huge gain from the Indian casino share of less than 20 percent in 1993.

Both Indian and commercial casinos could lose business to racinos, he said. State approval of gambling is easier at race tracks where betting already occurs than establishing new casinos, Meister said.

Revenue growth varied from as much as 26 percent in Alabama to minus 3 percent in New York. After Alabama, the fastest-growing states were Mississippi, Montana, North Carolina and Oklahoma.

Following New York, the steepest decline in revenue was in Oregon, North Dakota, Connecticut and Idaho.

Revenue at Indian casinos continued to be concentrated in certain states. California generated more revenue at Indian casinos than did any other state, producing $6.9 billion in 2011. Casinos in California accounted for more than 25 percent of Indian casino gambling revenue nationwide.

The top five states — Washington, Florida, Connecticut, California and Oklahoma — accounted for about 61 percent of total gambling revenue. The top 10 states, which include Arizona, Michigan, Minnesota, Wisconsin and New York, account for 86 percent of total Indian casino revenue.

Ironically, the weak economy has helped spur casino growth among states seeking more revenue, Meister said.

 | Categories: News |