Texas Attorney General: Daily Fantasy Sports Constitutes Illegal Gambling. Peggy Fikac, Chron.com
Attorney General Ken Paxton said Tuesday in a nonbinding opinion that daily fantasy sports is "illegal gambling" in Texas.
"Simply put, it is prohibited gambling in Texas if you bet on the performance of a participant in a sporting event and the house takes a cut,” he said in a statement.
For what it's worth, I agree with Mr. Paxton that DFS is, in fact, gambling. And gambling, per State law, is illegal outside of official functions of the lottery and increasingly limited horse and dog racing options. Also legal, that one Tribal casino, driving on Houston's freeways, on or around the Danger train or walking anywhere near Houston's police chief. Otherwise, gambling in Texas is illegal.
And if you don't believe that there is good money to be made on keeping it that way, Governor Abbott and (especially) Lt. Governor Dan Patrick are here to convince you otherwise. The campaign largesse provided to politicians who oppose gaming in Texas are much bigger than those that do. And the forces in opposition to Texas gaming are winning far more often than they are losing.
So, besides the politicians, who wins from this?
Louisiana and Oklahoma (Tribal) casinos for one. They're doing so well that Tillman Fertitta is already adding a new 300 room tower to his Lake Charles Golden Nugget property. The Winstar Resort and Casino in Oklahoma is currently working on a 65,000 square foot expansion of their convention center space and the Choctaw Casino and Resort (Oklahoma) recently put the finishing touches on their own $275MM expansion. Given that amount of money, Fertitta's $138K contribution and the Kickapoo Tribe of Texas' $125K contribution to Patrick's record setting war chest is peanuts. Opposing in-state gaming is good not only for so-called "free market" politicians but it's good for those rigging the game as well.
People who are morally opposed to gambling win, at least on a superficial level. Because what these laws are NOT doing is preventing people from gambling. So while those with means are certainly leaving the State to partake in gambling those without are increasingly being forced underground into the rich-target environments that are illegal, and unregulated, gaming houses. Others are simply taking their chances with illegal, and unregulated, online casinos that operate offshore. Neither of those options contribute to Texas tax revenues, although the former does contribute mightily to the revenues of Louisiana, Oklahoma and (especially) the Tribes. So while gambling proponents love to rally around the flag of social Puritanism, in fact they are putting the poor and those without means into even more danger, thus bringing increased crime into the neighborhoods, rather than less as they claim.
The Texas Lottery, and the various multi-State lotteries, are profiting as well. Because absent any meaningful competition things like low-success-rate, high-take-out scratch-offs and PowerBall drawings look attractive. If other gambling options were readily available then those state-sanctioned monopolies would all but cease to exist.
The next important day for Texas gaming is going to be February 16th, the day that funding is going to expire for the Texas Racing Commission. Prior to that an injunction hearing on February 3rd is going to be key. Failing that, and given their recent failure to repeal rules regarding historical racing terminals, Texas may be one step closer to the Lottery being an uncontested monopoly in the state.
And Dan Patrick, State Sen. Jane Nelson and others will see their reelection funds grow just that much more.
Meanwhile, Texans will continue to pour across the border or engage in illegal (and dangerously unregulated) activity in order to get their fix.
