Latest Texas online sports betting legislation filed though future remains uncertain

Texas lawmakers have introduced the latest proposal to bring legal sports betting to the state, but the fate of these and all other gambling proposals in the state face a difficult legislative path.

Identical bills filed Monday in both the Texas Senate and House would, if approved by both chambers, place a mobile sports betting voter referendum on the November 2023 ballot. Lawmakers also filed companion legislation that would regulate mobile sportsbooks in the state.

If passed by two-thirds of both chambers and a majority of voters, mobile sports betting would be set to begin in 2024.

The bills’ sponsors are Sen. Lois Kolkhorst and House Rep. Jeff Leach. Critically, Kolkhorst is a political ally of Lt. Gov. Dan Patrick, considered by many industry stakeholders as the key obstacle to passing the sports betting ballot measure legislation.

Patrick is an outspoken conservative Republican who has publicly resisted calls for any meaningful gambling expansion in the state. Patrick, in his role as lieutenant governor, also has strong control over the Senate and can effectively block any proposal.

Having a politically-aligned senator such as Kolkhorst on board could galvanize more support among Republicans in the GOP-controlled legislature. Democrats have shown a greater willingness to gambling expansion in the state, but Republican support will be essential to any bill movement.

Texas sports betting stakeholders

A host of professional sports teams and sportsbooks have lobbied in support of wagering legalization for several years.

The Texas Sports Betting Alliance has pushed for legal betting since the 2021 legislative session. The group hired former Texas Gov. Rick Perry as a spokesperson and advocate in 2022.

The group is made up of the state’s NFL, NBA, MLB, NHL, MLS, WNBA and NWSL teams as well as the PGA Tour and NASCAR. The bill explicitly would allow all teams from the aforementioned leagues and organizations except the NWSL to partner with one mobile operator. The state’s two major horse tracks would also have access to mobile sportsbooks.

FanDuel, DraftKings and BetMGM, the nation’s three leading sportsbook operators by market share, have been among the leading sportsbook advocates in the Texas Sports Betting Alliance. Barstool Sportsbook parent Penn Entertainment as well as the Fanatics sportsbook have also been supporters.

DraftKings (NBA’s Houston Rockets), BetMGM (MLB’s Houston Astros), bet365 (NBA’s San Antonio Spurs), Caesars (NFL’s Houston Texans) and PointsBet (MLS’ Austin FC) are among sportsbooks that have already partnered with pro sports teams ahead of any legislation. These operators are among the likeliest to enter the market, especially under the current market structure proposed by the bills.

Virtually all major operators are expected to show interest in a possible Texas sports betting market.

Texas is the nation’s second-most populated state and home to many of the nation’s best-known college and professional sports teams and organizations. The current 10% tax rate on gross gaming revenue is around the national median average.

Casino legislation introduced

The new sports betting-specific legislation comes after lawmakers have introduced multiple proposals to approve the state’s first commercial casinos.

Las Vegas Sands has spearheaded a proposal to bring resort, destination casinos to the state’s major metro areas. The company is one of the most notable US gaming companies to have made no major effort at a mobile sportsbook or iCasino.

Texas has not made any significant amendments to the state constitution’s gambling prohibitions since voters approved a government-run lottery in 1991.