Testimony expected on casinos in Texas

Senate committee hears testimony on casinos in Texas

Associated Press

AUSTIN, Texas (AP) -- Casino and racetrack supporters made their case Wednesday for allowing Texans to vote on a constitutional amendment to expand gambling, promising billions in new revenues and thousands of jobs.

But the biennial push to allow casinos in Texas still faces an uphill battle with some conservatives insisting that Texas remain one of only 10 states that ban such facilities. The Republican Party of Texas platform also opposes any expansion of gambling and calls for the repeal of the Texas State Lottery.

Sen. John Carona, R-Dallas, said the constitutional amendment he introduced is designed to bring together casino operators, racetrack owners and American Indian tribes that have worked against each other in the past while addressing the concerns of those who oppose all gambling.

Carona said he thinks Texas voters should get a chance to vote on the measure, which would limit the locations of 21 casinos.

"I'm Southern Baptists and I don't gamble, but I like to go to Las Vegas for the shows," Carona said, emphasizing the tourism possibilities. "We put everything into the constitutional amendment so that the only way we can change it is if the people of Texas come back and Texans voted again on the issue."

The proposal would allow one casino each in Dallas, Fort Worth and San Antonio with three additional casinos along the coast. Three racetracks in Dallas-Fort Worth, San Antonio and Houston could operate casinos, and nine small race tracks could apply for licenses to operate casinos or slot machines.

The three federally recognized American Indian tribes in Texas would also each have a casino license. The amendment would only allow two casinos per county and no more than three in a major metropolitan area.

The state would tax gambling revenue at 20 percent, unless the operator invested more than $1 billion, and then the rate would be 15 percent. At least 85 percent of tax revenue would go to reduce property taxes, the city and county would get 5 percent each, and the remaining 5 percent would be spent to prosecute gambling-related crime and help people with gambling addictions.

Supporters say their market research indicates Texas residents spend almost $3 billion in Oklahoma, Louisiana and New Mexico visiting casinos, and that the Chickasaw tribe has built the second largest casino complex in the nation just across the Red River to serve the Dallas-Fort Worth area.

They told the Senate Business and Commerce Committee on Wednesday that spending on convention centers and casinos could bring $8.5 billion in economic growth and 75,000 jobs to Texas.

Andy Abboud, representing the Las Vegas Sands Corp., said his company would invest in "integrated resorts" that generate revenue from conventions, dining and shopping in addition to gambling. He said the company's resorts dedicate less than 3 percent of total floor space to casinos, which serve as one of many amenities to convention goers.

"It's what they can do at the end of the day that makes a convention successful," said Abboud, who added that only 39 percent of his company's revenue in Las Vegas is from gambling. "Texas is one of the last great opportunities left in the world."

Most horse breeders have moved out of the state because Texas only offers $20 million in purses a year, while Louisiana, New Mexico and Oklahoma offer $210 million, said Andrea Young, president of Sam Houston Race Park, a horse track in Houston.

"Texas tracks need casino gambling for one reason, in order to compete with tracks in adjacent states," she said.

But others said lawmakers should not be persuaded by the promise of new hotels and convention centers.

"You didn't hear one person talking about the games," said Rob Kohler, representing the Christian Life Commission, which opposes gambling.

Melinda Fredricks, vice chairwoman of the Republican Party of Texas, read from party platform, "We oppose the expansion of legalized gambling and encourage the repeal of the Texas State Lottery." She said any attempt to allow voters to decide the issue was "a veiled attempt to pass the buck."

The conservative Texas Public Policy Foundation issued a statement saying that the proposed limit on the number of casino licenses was anti-competitive and warned against the hidden social and legal costs of gambling.

Sen. Eddie Lucio Jr., D-Brownsville, also warned that while he supported the measure, he knew some Democrats would oppose the measure because of possible negative economic and social consequences.

Carona promised to work with all groups to craft a better version of the resolution. It needs a two-thirds majority in the Senate and House before it can go before voters.

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Senate Joint Resolution 64: http://www.legis.state.tx.us/BillLookup/History.aspx?LegSess=83R&Bill=SJR64

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