Analysis: Will Legal Texas Sports Betting Ever Happen After 2023 Failure?

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Texas sports betting

Texas sports betting remains illegal in the Lone Star State, as legalization efforts shift all the way to 2025

The 2023 legislative session officially ended Monday, with a dead online TX sports betting bill facing an unclear path forward. As a result, Texans will spend at least the next two years needing to go out of state to find a legal book, or resorting to illegal offshore sites or local bookies to place wagers. 

With primary opponent Lieutenant Governor Dan Patrick having just been reelected through 2026, a roadmap to legalization remains tough to envision.

“As long as Dan Patrick isn’t on board, it’s not going to happen,” an industry source told LSR.  

Texas sports betting going forward

The feeling of some in the industry is that they knew it was a losing battle going in, but made inroads and were able to gain key takeaways moving forward.

Sometimes, like in New York, it takes multiple attempts to finally cross the finish line.

Still, with a massive challenge ahead, it seems imperative that key stakeholders all pull in the same direction if they want to succeed. Yet, as has often been the case in other big states like California, that is much easier said than done.

Why Texas sports betting died in 2023

The online sports betting bill advanced through the House for the first time before Patrick, the president of the Senate. declared it dead

Bill sponsor Rep. Jeff Leach hoped the bill could move through both legislative chambers by a two-thirds vote, to move it to a public vote needing a simple majority on Nov. 7

Yet Patrick kept his long-held anti-gambling stance and shot down those hopes. Given that Patrick stands to still be in office in 2025, the industry is already bracing for the same uphill battle.

Patrick thwarted legalization efforts 

Some in the industry held out hope that Patrick would soften his stance this cycle. But that turned out to be based more in rumor than reality. 

Perhaps it will happen eventually, though Patrick has given no such public indication of that. From beginning to end, Patrick said there would be no gambling expansion of any kind in Texas, and there was not

Industry observers said it was as simple as Patrick not wanting to betray his conservative voter base. 

Paging a Patrick whisperer …

There was also some industry optimism that bill sponsor Sen. Lois Kolkhorst, an ally of Patrick, could help make things happen. 

Yet Kolkhorst, an apparent believer in sports betting regulation, was silent on the issue throughout the 2023 state legislative session.

LSR attempted to get an interview or statement from Kolkhorst on numerous occasions. However, her camp repeatedly said she was too busy.

Pro sports owners not on same page 

Maybe Houston Rockets owner Tilman Fertitta had Patrick’s ear, as industry sources suggested earlier this year, but he did not sway the Patrick. Dallas Cowboys owner Jerry Jones is believed to have tried, but his efforts went for naught. 

Meanwhile, Dallas Mavericks owner Mark Cuban told LSR he is more intrigued by legalizing casino resorts than sports betting. Cuban was hoping to partner with Las Vegas Sands, which spent millions in an unsuccessful lobbying effort.

“At the end of the day, the Patrick obstacle was one even Jerry Jones couldn’t overcome,” an industry source told LSR

Under the bill, sportsbooks would have received market access through the professional sports franchises in Texas. It is expected that stakeholders in sports betting and casinos will, at the very least, have a conversation about joining forces.

Former Gov. Perry: closer but no cigar 

The Texas Sports Betting Alliance, a lobbying group of sportsbooks and teams, installed former Texas Gov. Rick Perry as its spokesperson. 

Perry is said to have made a positive impact on whipping votes for House passage. 

Yet, in the end, Perry was unable to get his close friend Patrick to change his mind. 

Perry on dead Texas sports betting bill 

Perry issued a statement on behalf of the TSBA after the bill died:

“We know that Texans want the freedom and liberty that our great state is known for, to participate in sports betting legally and safely. We listened to the people and put forth legislation that would combat the $6 billion illegal market with commonsense regulation and protect Texans without growing the size and scope of government,” Perry said.

“Texans deserve the chance to vote on legalizing sports betting and we will continue working to put this initiative on the ballot in 2025.”

Where do Texas tribes factor in? 

The Kickapoo Tribe was not pleased about being excluded from legalization efforts on both sports betting and casino fronts. Kickapoo Tribe chair Juan Garza said in a statement:

“Our Tribe has been in Texas for centuries. It is disheartening to have these big corporations prioritized over the economic survival of the Kickapoo.”

In the short term, all eyes will turn to the Seminole case in Florida, and how its decision could impact tribes in other states. 

For now, Oklahoma tribes can claim victory in the Texas failure to pass the bill. They already have casinos, and could end up legalizing sports betting before their neighbors. 

Economics could change

As of now, Texas has a $32.7 billion budget surplus. So it does not exactly need extra money, let alone that from expanded gambling. 

Either way, industry observers wonder if an economic downturn could move the needle. Granted, even more states legalizing sports betting by 2025 may not add pressure. 

“From an economic standpoint, I don’t think Texas cares about what other states are doing,” one industry source opined to LSR