Today the Texas Racing Commission will take testimony from citizens concerned with the agency’s impending constitutional overreach. The Commission is considering enacting a rule that would allow Texas horse and dog tracks to implement devices called “instant racing” or “historical racing” terminals which critics have said are nothing more than thinly veiled slot machines.

Public outcry has prompted the commission to move its meeting to a new location in the Reagan Building to accommodate larger than usual crowds. Many Texans are furious that the commission would consider an end-run around the legislature and the state constitution’s general prohibition on gambling.

Gambling proponents are putting up big dollars (including on a new web video they would like you to think is narrated by Morgan Freeman) to convince regulators that they have the authority to implement the new machines, comparing them to existing technologies.

But a new video by gambling opponents in Kentucky exposes the proposed machines for what they really are. A clip demonstrating the game play of “Yukon Willie’s Gold Rush” shows how similar the “racing” machines are to slot machines. With the press of a button, the gambler initiates randomly generated turning reel graphics which portray wins and losses. In a small corner of the screen, a three second clip of unidentified horses is shown. Within seconds, the gambler can press the “handi helper” button and initiate another bet and another turn of the reels.

But there is an even bigger problem with the machines than their slot machine-like appearance and operation. The machines are billed by track owners as an extension of “pari-mutuel wagering,” where gamblers bet against each other in a pool with the house taking a share of that pool, rather than putting up money of its own for players to win. This is the process through which betting is allowed currently for live and simulcast racing and is a very narrow exception to the state’s general prohibition on gambling.

Running such a scheme on single-player machines obviously presents a problem, however. If the players were truly betting against each other, then the first person up to the machine would have nothing possible to win.

That is why the rules being contemplated by the Racing Commission propose that the machines be funded with gambling interest dollars to form “seed pools.” This house money means that the machines are not “pari-mutuel” and thus, even ignoring their seedy appearance, are illegal under Texas law.

Respect for our system of law and order should dictate how the Commission handles this new proposal. The legislature arguably cannot even pass a law to implement these machines (such a decision being within the purview of the voters), yet the appointees at the Racing Commission are attempting to implement a huge change in the state’s gambling climate via rule. Like the abuses of power and process by the Obama administration, the Texas Racing Commission’s overreach should offend every Texan, no matter what they think about gambling.

Tony McDonald

Tony McDonald serves as General Counsel to Texas Scorecard. A licensed and practicing attorney, Tony specializes in the areas of civil litigation, legislative lawyering, and non-profit regulatory compliance. Tony resides in Austin with his wife and daughter and attends St. Paul Lutheran Church.


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