Texas Sports Betting Debate Taking Shape, But Look to 2025, Say Analysts

Posted on: March 23, 2023, 03:16h. 

Last updated on: March 24, 2023, 11:53h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Texas lawmakers are currently considering an assortment of gaming-related legislation. But some experts caution that sports wagering remains a long shot this year in the Lone Star state.

Dallas Cowboys QB Micah Parsons
Dallas Cowboys QB Micah Parsons reacts on the field after a play. Hopes for sports betting in Texas could be pushed out to 2025. (Image: USA Today Sports)

This week, the Texas House of Representatives State Affairs Committee is considering three gaming bills — two that combine casino licensing and sports betting, and a standalone sports wagering package. As the legislative session moves along, the casino bills may be reconfigured to exclude sports betting if that issue appears to be a nonstarter in terms of passage.

The online sports betting bill proposes that Texas professional sports teams and racetracks will be able to apply for an online sports betting license, and if awarded one, can partner with up to one online sports betting operator. The online sports betting tax rate will be set at 10% of adjusted gross sports betting revenue, and each license will cost $500,000,” noted Jeffrey Kamys of Inherent Wealth Fund.

Currently, Texas is somewhat restrictive in terms of wagering options, allowing only bingo facilities, a state-run lottery, and greyhound and horse racing.

Texas Sports Betting Heavy 2023 Lift

There’s some momentum for mobile sports betting in Texas, namely from the state’s professional sports team, the PGA Tour, and the Sports Betting Alliance, of which former Gov. Rick Perry (R-TX) is a spokesman. It’s also widely believed that if policymakers can successfully amend the state’s constitution to allow for sports betting, voters will overwhelmingly sign off on the activity if it makes it to the November 2023 ballot.

On the other hand, there’s plenty of opposition, including anti-betting groups, Oklahoma tribal casino operators, and commercial gaming entities. They argue Texas would be better suited to allow land-based gaming venues first, while leaving sports betting for another time.

“A new-ish wrinkle: The Kickapoo Traditional Tribe of Texas, which operates Class II casino gaming in the state, wants a seat at the table and wouldn’t have one under a pending online sports betting (OSB)  only bill that would make sports facilities OSB market access points,” according to Eilers & Krejcik Gaming (EKG).

Louisiana casino operators aren’t mentioned among the entities opposing sports betting in Texas, and the reason for that is likely simple. Many of those companies would probably have their hands in the Texas sports betting pie, assuming the market comes to life.

2025 Could Be Best Bet for Texas Sports Betting

Multiple factors are standing in the way of sports wagering being approved in Texas this year. Those include the long-running opposition of Republican Lt. Gov. Dan Patrick. Patrick, who serves as president of the state Senate, recently reiterated his anti-sports wagering stance in a local media interview.

Then there’s the matter of money. Some states, Illinois and New York being prime examples, embraced OSB to plug budget shortfalls. Texas isn’t in that position, as the state sports a tidy surplus. Additionally, there’s a matter of time. The Texas legislature is in session through May 29, meaning there’s a time crunch. Add it all up, and sports bettors in the state may be left waiting for another two years.

“That makes 2025 the more likely target for TX OSB legalization—another reminder the industry faces an uphill battle in getting the remaining big states over the line,” concluded EKG.