Texas lawmakers filed legislation backed by professional sports teams Monday to legalize Texas online sports betting.
Sen. Lois Kolkhorst and Rep. Jeff Leach filed companion bills SB 715 and HB 1942 to legalize and regulate mobile sports betting through professional sports organizations and racetracks.
The Sports Betting Alliance, comprised of Texas sports teams and national sportsbook operators, issued a press release backing the bills with quotes from the lawmakers and team owners.
Dallas Cowboys owner Jerry Jones said:
“A legal and regulated sports betting market is what’s best for Texas and I applaud Sen. Kolkhorst and Rep. Leach for filing this legislation. It will give Texans the ability to decide for themselves if they want this activity safely regulated or continue to be conducted in the shadows by out-of-state betting platforms.”
The enabling legislation issued in each chamber was paired with HJR 102 and SJR 39, companion joint resolutions proposing constitutional amendments authorizing the legislature to legalize sports betting.
Constitutional amendments require a two-thirds vote from lawmakers and voter approval on Nov. 7, 2023. Meaning 2024 is the earliest sports betting could start in Texas.
What’s in the Texas online sports betting bill
The legislation is nearly identical to the sports betting bill introduced in Texas in 2021 except for the removal of retail sports betting. This bill focuses solely on mobile sports betting in Texas.
Key details of the Texas online sports betting bill include:
- Regulated by the Texas Lottery Commission
- Online sports wagering platforms pay $500,000 for a three-year mobile sports betting license, renewable for $100,000
- 10% tax rate
- Requires the use of official league data for in-game betting
- Allows betting on college sports, esports, and amateur athletic events such as the Olympics, but not youth sports
- Operators are allowed to deduct promotional credits and the federal excise tax from gross wagering revenue
- Sports bets are defined as single-game wagers, teaser wagers, parlays, over-unders, moneylines, pools, exchange wagering, in-game wagering, in-play wagers, proposition wagers and straight wagers
- 2% of tax collected goes to a problem gambling and addiction grant fund
Kolkhorst and Leach are new champions for Texas online sports betting. Former sponsor Rep. Dan Huberty did not seek re-election. Sen. Juan “Chuy” Hinojosa, who introduced the Senate bill in 2021, signed on to SB 715 as a joint author.
Kolkhorst explained her support:
“I introduced SB 715 and SJR 39 because Texas needs to bring security and safety into the world of mobile sports betting. It makes sense to reign in all of the illegal offshore betting and keep sports wagering funds here in Texas. This is a sensible plan, which is why so many states have already passed similar legislation. As a former collegiate athlete, I respect the purity of sports and feel SB 715 and SJR 39 will promote integrity through transparent licensing, permitting and reporting requirements. Most important of all, it will stop underage offshore betting that is happening across Texas today.”
Who could get Texas online sports betting licenses
The Texas online sports betting proposal allows for 15 mobile sports betting applications. Each of the following could partner with one interactive sports betting platform provider:
- Dallas Cowboys
- Houston Texans
- Texas Rangers
- Houston Astros
- Dallas Stars
- Austin FC
- FC Dallas
- Houston Dynamo
- San Antonio Spurs
- Dallas Mavericks
- Houston Rockets
- Dallas Wings
- PGA Tour
- Lone Star Park (horse racetrack)
- Sam Houston Race Park (Penn National Gaming)
Houston Rockets owner Tilman Fertitta explained his team’s interest:
“Sports betting is a very popular form of entertainment. Sports fans enjoy placing bets on their favorite sports because it brings them closer to the team and puts them in the game. No one wins with an illegal market as robust as the one in Texas and I applaud Senator Kolkhorst and Representative Leach for recognizing the need to address the illegal market in Texas.”
Support from Texas sports teams
While Texas is a conservative state when it comes to gambling, it is known for its passionate sports fandom.
Certainly members of the Texas legislature are among those fans. So when Texas sports team owners ask for something, lawmakers do take notice.
Jim Crane, Houston Astros: “Sports betting is going to happen whether it is regulated or not. Rather than having Texans betting illegally through unknown companies in foreign countries, this bill will allow controls and safeguards for sports betting in Texas while generating significant revenue that will be used to reduce everyone’s property taxes in Texas.”
Ray Davis, Texas Rangers: “Fans betting on the outcome of sporting contests has been happening for years. It is time for sports betting to come out of the shadows so we can engage fans in an area where they are already spending time and money while enhancing the fan experience.”
Cal McNair, Houston Texans: “The Houston Texans support giving Texans the opportunity to choose for themselves if they want a regulated and taxed sports betting industry in Texas. We think a legal and regulated betting industry is best for our fans and partners and would protect the integrity of competition.”
Peter J. Holt, San Antonio Spurs: “Texas has the best fans in the country and legal sports betting is an exciting new way for Texans to engage with their favorite teams. “Sen. Kolkhorst’s bill will provide Texans the same opportunity that sports fans across the country now enjoy, the chance to utilize mobile sports betting in a responsible manner.”
The Sports Betting Alliance provided additional quotes from Texas sports team owners. Conspicuously absent was Dallas Mavericks owner Mark Cuban.
Chances for Texas sports betting passage
In 2021, the Sports Betting Alliance formed and made its first pitch at legalizing Texas sports betting. The proposal didn’t get much support from lawmakers, receiving one House hearing and dying in committee.
Gov. Greg Abbott and Lt. Gov. Dan Patrick, who controls the Senate, opposed legalizing sports betting. While some in the industry think Abbott and Patrick may be more open to considering the bills this year, that remains to be seen.
The Sports Betting Alliance stresses to conservative lawmakers they don’t have to make the choice to legalize sports betting. Passing these bills would let their constituents decide if they want legal and regulated sports betting.
Former Gov. Rick Perry, a new spokesperson for the Sports Betting Alliance, explained:
“Sen. Kolkhorst and Rep. Leach understand the voters of Texas want the chance to vote whether to legalize mobile sports betting. Revenue from legal mobile sports betting in Texas could bring in more than a quarter billion in the first biennium alone. Our neighboring states are cashing in on Texans’ bets and a smart, efficient legal framework will keep that revenue here to go towards much-needed property tax relief.”
Texas casino bill also filed
On Friday, Texas Rep. Charlie Geren filed HJR 97 to put the question of legalizing casinos in front of voters next election.
Backed heavily by Las Vegas Sands, the resolution updates the companion bills in 2021 from Rep. John Kuempel and Sen. Carol Alvarado to include horse racetracks.
The bill authorizes licensing seven resort casinos in Texas. In the 2021 bill, which Alvarado refiled early this session, horse racetracks could only apply for limited casino gaming. Under Geren’s bill, Texas horse racetracks also could apply to offer resort casinos.
The ballot question would permit the legislature to authorize sports betting but doesn’t provide further details. It creates the Texas Gaming Commission to regulate casinos and sports betting.