AUSTIN (KRLD 1080) – Texans are still big supporters of expanding gambling, according to a new poll.

Baselice and Associates, of Austin, just released a new poll which shows 82 percent favor a vote on adding slot machines at horse and dog tracks and existing Indian reservations.

“If it’s on the ballot, then it wins,” says pollster Mike Baselice. “The support is shared by a large majority of voters regardless of their partisan background or make-up.  63% of Republicans, 66% of Democrats and even 64% of independent voters favor allowing slot machines at the tracks and
Indian reservations.”

Baselice says it’s important to remember that the expansion he’s talking about would be an increase in the kinds of gambling available in Texas.  It would not change the number of locations where you can gamble.  He says that might explain some of the support.

 | Categories: News |

By Bill Hammond
The Texas Tribune

There’s something to be said for leaders in the Texas Legislature sticking to their guns and releasing a state budget that keeps spending within existing revenues.

To my friends in the House and Senate, I say: We must continue to fight to ensure that we implement cost-saving reforms that reflect Texas’ commitment to economic growth. But our current budget shortfall isn’t a time to be penny-wise and pound-foolish.

The state will have $72.2 billion available for general-purpose spending during the 2012-13 biennium, leaving a $15 billion gap from the current general revenue spending of $87 billion. How do we close this gap? It will take grit and courage to address the shortfall without raising taxes, creating new fees or increasing existing ones. Difficult? Yes. Doable? Absolutely.

First, let’s hold the line on general revenue spending at its current level of $87 billion for the biennium. Next, while the sky isn’t falling, it sure is raining. So let’s have the courage to tap the Rainy Day Fund for $6 billion, a prudent and appropriate action.

To control health care costs, one simple fix is to remove a loophole that allows the Rio Grande Valley to effectively opt out of Medicaid managed care. This single change — expanding Medicaid managed care statewide — would result in $1.2 billion in savings.

We need efficiencies in government, including education, where smart budgeting and reforms will offer a significant return on our investment by way of an educated, skilled workforce.

We’ve worked hard to raise high standards for students in pre-kindergarten through high school. To that end, we must use the Available School Fund for its constitutionally intended purpose — student textbooks and instructional materials, including technology. Budget writers should prioritize $550 million of the fund for digital and print materials for pre-K, English as a second language, writing and science — all of which are due to classrooms this fall.

We could also use more of the $1.9 billion Available School Fund to restore programs eliminated in the base budget that have had proven success in improving education in Texas. Among these strategic investments are a $270.9 million technology allotment, $223.3 million for pre-K programs that provide a solid foundation for our youngest students, $385.1 million for incentive pay for our school’s most outstanding teachers, $51 million for proven secondary level strategies that will improve post-secondary readiness and graduation rates, and $20.3 million for the virtual school network.

There’s also a case to be made for fully funding effective, efficient state programs in public and higher education that are critical to our state’s long-term competitiveness and prosperity. I’d argue for the TEXAS Grants program to be kept at current spending levels, while making reforms to ensure greater productivity. We must graduate more students with degrees or post-secondary credentials, and a priority-based TEXAS Grants program that remains fully funded will certainly help us get there. Higher education funding should be kept level, too, but let’s demand better performance by requiring 10 percent of higher education funding to be based on completion rates.

Plenty more opportunities exist to make strategic cuts, accounting tweaks and smart updates to state law to get us to the $87 billion budget target.

For one, let’s go ahead and delay the date of payments by the state by one day into the next fiscal year, a useful tactic used when Texas last faced a significant budget crunch in 2003. This simple action could save the state $3 billion to $4 billion.

While we don’t have to expand the gambling footprint, we can and should pass legislation to allow slot machines at existing Texas horse and dog racetracks and Native American reservations. These machines would generate as much as $850 million in direct state tax revenue during the current biennium and nearly $1 billion per year at full implementation.

We can pass legislation that requires probation with mandatory treatment for first-time, low-level drug possession offenders with no prior violent, sex, property or drug delivery crimes, allowing for an estimated $500 million savings by 2012.

As for the remaining $2.5 billion, it’s reasonable to consider some of the thoughtful recommendations laid out in recent days by organizations like the Texas Higher Education Coordinating Board, the Texas Public Policy Foundation and Texas Conservative Coalition Research Institute.

What I have set forth could best be summed up as a rational proposal for budgeting. Let’s make strategic cuts and responsible investments that will ensure our state’s continued prosperity.

Bill Hammond is president and CEO of the Texas Association of Business. He served four terms in the Texas House of Representatives.

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More gambling touted as solution to budget crunch

Racetrack and casino interests have tried before to persuade lawmakers to expand gambling in Texas, only to come up empty-handed.

Now, with the state facing a budget shortfall of about $27 billion, those interests are back and pitching expanded gaming as a cure for the Lone Star State’s financial woes to the new session of the state legislature that began Monday. Racetrack operators also say it’s the last shot to revive their floundering industry.

Adding slot machines at 13 tracks around the state and three Indian reservations will add $1 billion annually to the state’s coffers, racetrack operators argue. Another group that supports casinos, meanwhile, says the opening of anywhere from four to eight Las Vegas-style casinos around the state — including in Houston – will produce even more money for Texas. The Texas Gaming Association, the casino group, expects to release financial projections next week.

Opponents, however, question the estimates and counter that the sociological costs – such as crime and addiction – overshadow any benefits.

Poll favors expansion

Expanding gaming requires a vote of two-thirds of the legislature, with voters getting the final say. A new poll done for the Chronicle and the state’s other major newspapers found 60 percent favored an expansion of gaming.

Expanding gaming may be a last-ditch attempt at saving racing. Without slots, Texas track operators say, they won’t have the additional revenue to increase purses and attract quality horses.

“You will likely see the fall of several players,” predicted Andrea Young, president and chief operating officer of Sam Houston Race Park . She wouldn’t say whether Sam Houston would be one of them.

Money goes out of state

Texans spend some $2 billion annually at racetracks and casinos in surrounding states, according to Win for Texas, the racetracks’ lobbying group. It asks: Why not have residents spend that money here?

In the last legislative session two years ago, the racetracks, horse owners and breeders couldn’t come to any sort of agreement. This time is different, they say.

Under the racing industry’s proposed legislation, the state would get 30 percent of the slots revenue. The tracks would keep 58 percent, and the remaining 12 percent would be earmarked for purses and other items for the horse and greyhound industries, said Dave Hooper, executive director of the Texas Thoroughbred Association, which represents owners and breeders.

The Texas Gaming Association, which represents casino operators, is proposing four to eight casinos. Three would be in the largest counties – Harris, Bexar and Dallas – and at least one other would be in a coastal town, said spokesman Scott Dunaway.

Proponents of expanded gaming may be facing long odds. Rep. Lon Burnam, a Fort Worth Democrat who participated in a forum on gambling expansion last summer, noted that at least 50 of his colleagues wouldn’t vote for it on religious grounds.

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by Nick Lawton
NewsWest 9

ODESSA – When a horse racing park in Austin lost their owner, that put its future on shakey ground. But those Lone Star Park woes in Austin are being felt all the way here in the Basin.

The JMR Ranch is a horse farm with only a handful of horses.

It didn’t used to be this way.

“Just constant activity, we had horses coming’ in and out,” JMR Owner, Robin Gaither, said.

But now it’s a grim reality.

It’s a big investment of both time and money raising horses for either racing or showing. And with more venues closing, public interest is waning, which has sent the breeding business reeling.

“You just can’t make any money with horses right now, because there is no market for them,” Gaither said.

Gaither says there was a time when their pens were empty and they had to turn horses away, now they’ll be lucky if they get any.

It costs about $200/mo. per horse to take care of it, that’s spread over a two-year process to get them ready for their careers.

This isn’t just a business, it’s a way of life.

Now as that way of life is threatened, children who grew up in it are forced to move on.

“I used to take care of all my Mom’s horses for her, did all that, but then it just wasn’t enough anymore so I got me a part-time job,” Robin’s Daughter, Mackey Pounds, said.

With races and shows becoming scarce, the money can’t be made back that’s been put into the horses.

Robin said she’s had to lay off ranch hands and manage the farm on her own as setbacks are being felt everywhere, in horse feed, veterinarians, transporters, and farriers who shoe the horses.

“Right now, 4 or 5 a day is average, and used to be so booked I couldn’t stop at 7 or 8,” Farrier, Leslie Lovett, explained.

When people think of Texas, they imagine the Cowboy, ever vigilant on his trusty steed. But unless something changes, the sun could set on this state’s horse business.

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By Gary West
Fort Worth Star-Telegram

It was a quake. And the Texas horse industry was shaken to its very foundations by what happened Tuesday in Austin. Or rather by what didn’t happen.

Lone Star Park didn’t get a new owner Tuesday. The racetrack remains where it has been for 13 months, in bureaucratic limbo, its future uncertain. And that means the future of Texas racing is perilously uncertain, for as Ken Carson of Valor Farm in Pilot Point said, expressing the concerns of the state’s horse breeders: “Without Lone Star, we’re doomed.”

The breeding season will begin soon. The horses foaled, or born, next year will race in two years. Those conceived next year will race in three years. But where will Lone Star Park and Texas racing be in two or three years?

Because of what happened, or didn’t happen, Tuesday in Austin, horse owners and breeders aren’t able to answer that question. And so they’re more likely than ever to abandon Texas farms and send their horses to Oklahoma, or New Mexico or Louisiana.

At Tuesday’s meeting, the Texas Racing Commission was expected to consider Lone Star Park’s request for a change in ownership. Thirteen months ago, a bankruptcy court approved the sale of Lone Star to Global Gaming Solutions, but the transfer still required the approval of the state’s regulatory agency.

Most people in Texas racing expected and anticipated that approval months ago. And when the item finally made its way to the agenda, on the morning of the meeting Global Gaming asked that its business be deferred.

The request, it’s reasonable to assume, grew out of some loamy anxiety about whether the new ownership’s application would receive a favorable reception from the commission. But whatever the reason, the effects are still reverberating through the state’s horse industry.

“If this doesn’t transfer,” Carson said about the Lone Star ownership, “I think it could be the beginning of the end.”

Valor Farm, which is owned by Clarence Scharbauer Jr. of Midland, is one of the state’s most successful breeding farms. Like many Texas horse farms, it’s going through the worst year in its history, which means fewer mares bred to fewer stallions. But with the breeding season approaching, Carson said, and with the anticipation of Global Gaming’s coming to Texas, the phone was starting to ring and optimism to rise.

“You could feel a change in the atmosphere,” said Carson, the Valor Farm general manager. “Until Tuesday.”

The recent dispute over race dates and this prolonged process of transferring ownership, Carson said, have discouraged horsemen, as well as potential horse owners, who all need to be able to plan two or three years in advance. And this latest setback, he said, is potentially devastating.

With horse farms in Oklahoma, New Mexico and Texas, Jim Helzer is one of the region’s most prominent breeders. Anticipating the new ownership at Lone Star, he said he had planned on bringing many of his horses back home to Texas, to his JEH Stallion Station in Pilot Point, for the upcoming breeding season. At least that had been his plan until Tuesday.

“I don’t think that’s going to happen now,” he said. “I was very optimistic, but now, well, I don’t know.”

Helzer, who’s one of the more optimistic persons in the state’s horse industry, said he expects many breeders to begin sending their horses into neighboring states immediately, lest their foals be born in Texas, where the future remains perilously uncertain and its premier racetrack in limbo. Reasons to stay are weak; incentives to leave powerful.

A horse foaled in Louisiana, for example, is a Louisiana-bred even if the mare arrived there only a month earlier and was actually bred elsewhere. And if that mare is then bred to a Louisiana stallion, her foal will be eligible for all those lucrative Louisiana-bred races and for big-dollar purses not available in Texas.

And so this transfer of ownership isn’t just about politics or bureaucracy or even a racetrack; it’s about all those Texas horse farms, all those Texas racehorses and all those Texans who care for them. They’re still feeling the tremors and aftershocks from Tuesday.

Still committed

Although Global Gaming Solutions, which is owned by the Chickasaw Nation of Oklahoma, asked that its application for ownership of Lone Star be taken off the agenda Tuesday, the company remains “committed to the horse racing industry,” according to John Elliott, the company’s CEO.

“The plan is to work our way through what we need to do to put the application forward at a later date,” Elliott said about the transfer of ownership from bankrupt Magna Entertainment to Global Gaming. “Our plan is to carry on.”

A track in Cowtown

Greg Lamantia of McAllen, told the racing commission that he expects to submit an application very soon to transfer his license for a Class 2 racetrack to Fort Worth. The originally proposed site of the racetrack is in Laredo.

After Tuesday’s meeting, Lamantia explained that a couple of “technicalities” needed to be resolved, but that the application should be ready for the commission in about 30 days. He declined to identify the exact site of the proposed racetrack, except to say that it would be in Fort Worth.

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By Peggy Fikac, Austin Bureau

Texas voters prefer spending cuts over new revenues to balance the budget, but if money must be raised, they would like to see it come from higher taxes on alcohol and expanded gambling, according to a poll conducted for the state’s largest newspapers.

“They don’t want to see government grow,” said pollster Micheline Blum, of Blum & Weprin Associates Inc., of New York. “When they do think about increasing revenue at all, they go for the vices.”

In the face of a budget shortfall that some project will top $20 billion through the next two years, voters surveyed would rather slash higher education funding than that of public schools, health care for the poor or public safety.

Asked where they would cut the most among the four areas, 28 percent of likely voters targeted higher education. About the same percentage, said they would not want to cut from those areas at all.

The telephone poll was conducted Oct. 22-27 for the Houston Chronicle, San Antonio Express-News, Dallas Morning News, Fort Worth Star-Telegram and Austin American-Statesman. It included 1,073 registered voters, 673 of whom were classified as likely voters. The margin of error for likely voters is plus or minus 3.8 percentage points.

Asked whether they would like to see lawmakers do more to cut spending or boost revenue to balance the budget, 50 percent of likely voters said cut spending; 19 percent said increase revenue. Twenty percent said they would like to see both done equally.

Poll respondent Rafael Soto, 66, of San Antonio, chose spending cuts as the way to go.

“The problem with that is nobody wants to give up anything that we have,” he said. “Everybody says we need to cut, but nobody wants to say how, why or do anything about it.”

After higher education, 12 percent of respondents said they would like to see spending cuts in public safety, and 7 percent chose health services for the poor. The least appealing option appeared to be reduced spending on public education, with only 4 percent choosing that.

If revenue is to be raised, 42 percent favor increasing taxes on alcoholic beverages, while 22 percent want to authorize new forms of gambling. Eleven percent picked broadening the sales tax to include items not currently taxed, and 3 percent chose the idea of a statewide property tax. Nine percent said they would not raise revenue by any of those methods.
Add those slot machines

The most popular choices listed in the poll, however, would not have a big immediate effect. The mixed beverage tax, set at 14 percent in 1990, brought in nearly $619 million in the 2010 fiscal year. Even doubling it would leave a huge revenue gap.

Putting slot machines at race tracks and Native American lands would yield $500 million to $1 billion in the budget period, and nearly $1 billion a year after that, say those backing the idea.

Eric Baggs, 37, of San Antonio, said the shortfall should be addressed by both cuts and increased revenue. He picked universities as a place to cut.

“If you’re going to go to college, there’s a lot of ways to go to college. If you want to make that commitment to education, then you should make that commitment on your own,” said Baggs, who works for a liquor distribution company. “I figured out a way to pay for my college. We don’t have to pay for everybody else’s college as well.”

Jeanne Pressler, 61, a senior trainer with the Houston Police Department, said she favors cuts in public education over raising taxes or fees to balance the state budget.

“I don’t have any children, so it doesn’t make a lot of difference to me,” Pressler said. “We’re paying lots and lots of our tax money on schools and I don’t think we’re getting our money’s worth, from what I read in the newspapers.”
Whack higher education

Retiree Shirley McKee, 75, of Houston, said to balance the state budget, higher education should be cut. She said the parents of those seeking college educations should pay the tab, or students should take out loans, as her eldest son did.

“I can’t support the rest of Texas for higher degrees,” she said. If more money is needed, she said she would vote for casino-style gambling.

Joyce Horton, 61, a retired high school math teacher from Kingwood, said the state should handle its budget problems through a combination of cuts and increased revenues.

“I don’t mind paying taxes if it goes to a good worthy cause,” Horton said, but added she could see expanded casino-style gambling at horse tracks. “We have a lot of revenue in the Houston area going over to Louisiana. So long as it’s not corrupt, I don’t see a problem with keeping it in Texas.”

Texas Commissioner of Higher Education Raymund Paredes was concerned over the poll results regarding higher education funding.

“People tend to think that public higher education is better off than it is,” he said. People “know that universities can raise money through tuition and fees, so they assume that people can bear the cost. They don’t know there are a lot of very needy kids that cannot afford higher education without support.”

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By David Barron, Houston Chronicle

HOUSTON — Sam Houston Race Park will announce today that it has entered into an ownership and operations agreement with racetrack and gaming giant Penn National Gaming Inc. as Texas track owners prepare to push for expanded gaming options from the Texas Legislature next year.

Penn National would acquire a 50 percent interest in the joint venture, which operates Sam Houston, Valley Race Park in Harlingen and a planned racetrack in Laredo. The value of the transaction, which is subject to approval by the Texas Racing Commission, was not disclosed.

Today’s announcement comes as the financially troubled Texas racing industry gears up for a full-scale lobbying effort before the 2011 Legislature to approve slot machines and other gambling options that industry observers say will benefit the racing business and the Texas economy.

“This industry is struggling, and so to have somebody with a national footprint is a great thing for us,” said Shawn Hurwitz, the track’s chief executive officer.

Penn National describes itself as the largest owner and operator of parimutuel racetracks in North America, including a joint interest in Pimlico, home of the Preakness Stakes.

Peter M. Carlino, CEO of Penn National, in a company statement cited Penn National’s “strong track record of transitioning racing facilities into successful racing and gaming entertainment operations.”

“Given the state of the economy, we are eager to begin work with state and local stakeholders on establishing legislation that will quickly reinvigorate racing operations throughout Texas and provide recurring tax revenue needed to fund local and statewide projects,” he said.

The state’s Class I tracks, Retama Park in Selma, Sam Houston and Lone Star Park in Grand Prairie, have struggled financially.

“Without gaming legislation, the whole industry is at risk,” said Doug Vair, Retama Park’s director of marketing and publicity.

Track owners and casino interests will attempt to convince lawmakers next year that expanded gambling will help avoid tax increases or deeper budget cuts while dealing with a shortfall of as much as $21 billion. House Appropriations Chairman Jim Pitts, R-Waxahachie, has promoted the idea of legalizing slot machines at tracks as a possible budget Band-Aid.

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By Gary West


GRAND PRAIRIE — If that’s going to be Texas racing, why bother? But, of course, that procession of bad racing that concluded Sunday at Lone Star Park, a cavalcade that sometimes rose to the level of mediocrity but rarely approached excellence, won’t be Texas racing much longer. It’ll be replaced by something much better, or by nothing at all.

That’s the choice for Texas racing: Either improve or disappear.

Lone Star Park’s thoroughbred racing season ended Sunday with a sharp downturn in handle that reflected an equally troubling decline in the quality of the local racing. But those were only the latest symptoms.

Texas horse racing is very ill; in fact, it’s moribund. And if the state’s racetracks and horsemen don’t move immediately and dramatically, Texas horse racing will die. Listen closely, and you can hear the death rattle.

Other symptoms: Howard Phillips of Manor Downs has announced that the small Austin racetrack, which is only simulcasting at the moment, will almost certainly shut down next Sunday; Retama Park near San Antonio has amended its fall schedule to reduce the number of its racing dates from 30 to 16. And even with its abbreviated season, Retama will be able to offer only paltry purses of $80,000 a day, according to Bryan Brown, the chief operating officer.

Friday at Lone Star, at a meeting that brought together representatives from the racetracks, the horsemen’s groups and the Texas Racing Commission to discuss next year’s calendar, Jack Bruner, the fourth-leading trainer at Lone Star Park, said that if nothing changes next year he will have to move his stable to a state that offers “better racing and more money.” Bruner trains the horses of prominent local businessman Tom Durant, the all-time leading owner at Lone Star.

Listen closely and you can hear the death rattle. Also at Friday’s meeting, Andrea Young, the president and chief operating officer of Sam Houston Race Park in Houston, said the track won’t be able to keep its “doors open” if current trends continue. The trends could indeed shut many doors in Texas.

Over the last five years, the purses, or prize money, available to horses racing in the state have declined 29 percent, according to the racing commission. At Lone Star, purses this year fell to $145,000 a day, the lowest level in the track’s history. During the same five-year period, purses in Arkansas have increased 6 percent, in Louisiana 23 percent, in New Mexico 30 percent and in Oklahoma 140 percent.

The average purse for a thoroughbred race in Texas last year was $14,324. That’s 28 percent below the regional average of $20,046 and 32 percent below the national average of $21,061. And so there has been an exodus of better horses from Texas. The procession of remaining horses concluded Sunday.

Yes, the season had its moments; it wasn’t void of sparkle. And even if they looked like oases in a desert, there were notable achievements. Chris Landeros topped the jockeys’ standings with 101 victories, one shy of the record held jointly by Corey Lanerie and Cliff Berry. Bret Calhoun, who grew up in Grand Prairie, won his first local trainer’s title with 62 victories.

For trainer Bob Baffert, Game On Dude won the Lone Star Derby and then went on to New York, where he finished fourth in the Belmont Stakes. Among the 2-year-olds, Aces N Kings won the jackpot. Redding Colliery looked like a star taking the Lone Star Park Handicap. And the local queen, Wasted Tears, won the Ouija Board Stakes again.

But more than anything, this Lone Star season proved that Texans won’t bet, or won’t bet much, on bad racing, on the daily, relentless grind of the unappealing.

The Lone Star handle, or money wagered on local races, declined 22 percent from a year ago, to a daily average of $1,115,900. Most of that was off-track handle — that is, money bet elsewhere on simulcasts of Lone Star races. That was down 25.4 percent, indicating a rejection of the local racing product.

But even at Lone Star, fans hesitated to bet on the local races, choosing instead to bet most of their money, about 64 percent, on imported simulcasts of races run elsewhere.

“The product we put out on the track we weren’t proud of,” said Lone Star president Drew Shubeck, explaining that all the numbers and research indicate that the poor racing, and poor economy, led to the declines.

Even with more people at the racetrack, the handle tumbled. Lone Star averaged 6,930 in attendance for the season, compared with 6,883 last year.

And so that procession that concluded Sunday won’t be Texas racing much longer. In September, the racing commission will consider the transfer of Lone Star to Global Gaming Solutions, which is owned by the Chickasaw Nation. If approved, the official transfer could be completed Sept. 20.

Global Gaming and Grand Prairie already have committed to some capital improvements for next year. And Global Gaming supports the plan for consolidation that could meaningfully improve the quality of racing next year.

The plan, as outlined at Friday’s meeting, would consolidate Sam Houston’s and Lone Star’s purse money for thoroughbreds. That would make possible a 60-day season at Lone Star, with purses at $230,000 a day.

“We’re going to turn our racing office loose to recruit stables in the region that have left Lone Star in recent years,” Shubeck said, explaining what will happen if the plan is approve. “And we’ve already talked to some local owners about upgrading their stables for next year.”

But listen closely, and you can still hear the death rattle. At Friday’s meeting, some horsemen, arguing on behalf of bad racing and mediocrity, opposed consolidation. Yes, Texas racing will soon change: Either it’s going to get better, or it’s going to disappear.

Gary West, 817-390-7760

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Proponents of slots, casinos likely to press issue in session.


Lawmakers heard Thursday from gambling proponents who think the upcoming session could be their best opportunity in years to expand gambling in Texas.

Many of the gambling proponents’ arguments on Thursday sounded essentially the same as they did in years past, but an estimated $18 billion budget shortfall makes the possibility of increased gambling a viable one for the upcoming session, proponents said.

“It feels like there’s a little bit more urgency,” said Mike Lavigne, who represents racetrack owners.

Members of the House Licensing and Administrative Procedures Committee listened to track owners, casino proponents, Indian tribe representatives and bingo hall operators. They all discussed effects of expanded gambling in Texas.

People representing horse and dog tracks offered some updated figures about how allowing slot machines at racetracks would bring needed money to Texas’ coffers.

Speaking for Win for Texas, a racetrack group, John Hockenyos said allowing slots at tracks would stop the leaking of cash out of state and recapture Texans’ money that has been left in other states with broader gambling, such as Oklahoma and Louisiana.

Hockenyos, who works for the economic policy consulting firm TXP and prepared the study for the Texas racing industry, said slots at racetracks would generate about $1 billion a year in taxes for Texas.

“Billions of dollars are leaving Texas and ending up in neighboring states’ economies,” he said in a statement. “Much of this is preventable if Texas allows slot machines at its racetracks.”

But Bill Thompson, professor of public administration at the University of Nevada, Las Vegas, said Win for Texas’ numbers seemed optimistic. Thompson estimated that Texas’ revenue would be less than $500 million on 35,000 slot machines that would be taxed at 30 percent.

“The thing is, it’s going to be way below your budget problem,” he said, adding that increased gambling would lead to additional social costs, such as those related to treating compulsive gamblers. “It’s not going to be all gravy.”

If Texas approves slots at racetracks to keep Texans’ gambling dollars in the state, Thompson said he expects a push for more gambling in coming years.

Pennsylvania, he said, started with slots at tracks in the past couple of years to lure gamblers back from West Virginia, which already had the machines. Then in January, Pennsylvania lawmakers voted to allow table games in the state to again battle the state’s southern neighbor.

If Texas gets slots, expect a similar result, Thompson said. “Why don’t they put it all on the table now,” he said, “so they won’t have to go through it in the next couple years?”

That kind of expansion would be fine with other people who testified at the hearing. Jack Pratt, chairman of the Texas Gaming Association, testified about the benefits of casinos in Texas. He’s asking for the establishment of up to 12 “world-class destination resort casinos” across the state.

Pratt said that if Texas gets the opportunity to have casinos, they should be bigger and better than ones in nearby states.

State and local tax revenue would be between $3 billion and $4.5 billion per year, the association said.

Thompson said Pratt’s estimate on tax revenue, like those with slots, seemed inflated. He said he would estimate that the figure would be in the hundreds of thousands. He added that Nevada doesn’t even garner tax revenue in the billions.

Though Nevada takes a relatively small cut from gambling — 6.75 percent, compared with a possible 30 percent here — the western state collected about $631 million in taxes for the 12-month period that ended June 30, according to a July 7 article in the Las Vegas Review-Journal.

People representing charitable bingo halls and three Indian tribes in Texas also testified at Thursday’s hearing. They all said that they want to be part of any discussion about increased gambling in the state.

Several other states have considered gambling in the past couple of years as they have faced similarly bleak economic outlooks. As of May 12, lawmakers across the country have introduced more than 20 measures, according to data from the National Conference of State Legislatures.

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by Ross Ramsey, Texas Tribune

This really is all about the money.

Texas lawmakers have been talking about various forms of legalized gambling for decades, and the only times they’ve allowed new forms — first bingo, then pari-mutuel wagering on dogs and horses, then the lottery — have been times of financial peril for the state.

They’ll start the latest round officially with hearings in Austin this morning before the House Committee on Licensing and Regulation. Legislation won’t be filed until after the November elections, but the field of play is clear: Gaming interests inside and outside Texas want lawmakers to expand legal gambling to include either slot machines at race tracks, resort casinos or some combination.

It’s always a contentious subject, and state Rep. Edmund Kuempel, R-Seguin, has a strategy for today’s hearing: “Let ‘em vent. Just let them talk. Pros, cons, in-betweens, fors and againsts, independents … just bring it on.”

The subject matter hasn’t changed in the last two or three legislative seasons, but the financial environment is different now. State budgeteers estimate they’ll have up to $18 billion less than they need for current programs when they put the next budget together, and they need some mix of spending cuts, revenue increases and trickery to make the books balance. In a state where tax increases are often treated as a form of political sacrilege, gaming seems to be a relatively painless way to raise money. And the people pushing gaming this year are telling lawmakers that new wagering could raise $1 billion or more every year. That doesn’t cover the hole, but it’s not chicken feed.

Texas is surrounded by gambling. New Mexico, Oklahoma and Louisiana all have racetrack casinos, according to the American Gaming Association. And TXP — an Austin-based economics consultancy hired by Win for Texas, the track owners’ group — estimates Texans wagered $2.7 billion in 2009 in the region that includes those three states along with Nevada, Mississippi, Arizona and Colorado. They go on to predict that $2.2 billion of that would stay here with slots at tracks and that the total amount gambled would reach $3.9 billion by 2013. When TXP pulled in numbers from estimated economic impact and so on, it came up with an expected annual take for the state if slots were allowed at tracks: just under $1 billion. It also estimates that allowing slot machines at racetracks and on the state’s three Indian reservations would create more than 77,500 jobs.

“Texans are spending billions of dollars — we’re just not keeping it in Texas,” says Mike Lavigne, a spokesman for Win for Texas. The arguments are somewhat familiar, he admits, but more data is available to decision-makers, especially on the shift in competition. “We’re no longer in competition with Las Vegas, but against Louisiana and Oklahoma,” he says.

Kuempel says the comptroller — who’ll start the legislative session by telling lawmakers how much money she thinks the state will have to spend in its next budget — will write the script for the debate. Gambling isn’t acceptable to some lawmakers, except in the face of other less tasteful alternatives.

The proposals for casinos, racinos, slot machines and other hybrids are not new, and the general arguments for each are familiar to policymakers who’ve been around for a while. Today’s hearing will (be) a primer for the new kids in the Legislature and for Texans engaged in the issue for the first time. And, of course, the talk will circle back often to money: What does Texas have to gain by letting its citizens lose at tables and slots closer to home?

The Win for Texas group — which includes current racetrack owners who’d like to add slot machines and other games to their facilities — is touting that updated study on the “Economic and Tax Revenue Impact of Slot Machines at Racetracks in Texas.” The Texas Gaming Association — those are the folks who want to legalize and build resort casinos around the state — will update its economic studies and polling closer to the legislative session, according to Chris Shields, the group’s chief lobbyist. Its previous work has promised larger revenue numbers for both the state government and for the economy. And the rivalry between the various gaming factions has been the secret weapon of gambling opponents. Casinos versus tracks has been a losing proposition in recent sessions.

“It’s different this year because of the situation with the budget,” Shields says. “What hasn’t changed, but I think will change, is the willingness of the gaming interests to work together. I don’t think there’s any way for a bill to pass without that — and everybody wants a bill to pass.”

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