Is Texas ready for the sports betting industry? Legislation, Timeline & Updates 2023


As the wave of sports betting legalization has swept the nation, there are still many holdouts. Most notably that list includes the three most populated states. Florida briefly had limited legalization, but now that remains tied up in court with not much hope of any imminent change in the status quo. California residents overwhelmingly rejected two legalization Propositions on the ballot in 2022, and it is back to the drawing board there as well. Perhaps the best hope of a big legalization domino falling in 2023 sits in Texas.

The Lone Star State has tried and failed before, with sports betting legalization bills getting introduced in the legislature and then failing to progress in both 2019 and 2021. Things may change this go around. Republicans Lois Kolkhorst in the state senate and Jeff Leach in the state house introduced legislation on February 6th that would legalize and regulate online sports wagering in the state. It proposes a constitutional amendment that would ultimately go before the voters for approval this November. If passed, Texas would tax operators at 10% of profit, which estimates suggest will produce $1.5-$2 billion of revenue.

The Backers

Why might this effort succeed while other similar efforts have failed? Many reasons. 

There is Increased bi-partisan support. Democrats in Texas have generally been more open to legalization, but this bill originates with two Republicans. Plus Governor Greg Abbott, who has had reservations in the past, is more open to approval at this point. Lt Governor Dan Patrick (very much not the sportscaster Dan Patrick) remains generally opposed but has softened his stance this go around. 

The public backs legalization. A recent poll conducted by the University of Houston’s Hobby School of Public Affairs found 75% approval of a specific constitutional amendment proposal that was brought forward by Dem Senator Carol Alvarado that provided for four specific sports betting “resorts”. A poll back in 2021 found 43% in favor of legalization, 26% opposed, and 31% ambivalent with roughly even numbers across party lines.

Finally and perhaps most importantly, the current push is backed by some powerful entities who have joined to form the Texas Sports Betting Alliance. Former Texas Governor Rick Perry is a spokesperson for the group that includes Mavs owner Mark Cuban, Cowboys owner Jerry Jones, Houston Rockets owner Tillman Fertitta (who made his fortune in the casino business), and Astros owner Jim Crane. 

Texas has eight teams in the four major sports and has joined the alliance. Other members include  Austin FC, FC Dallas, Houston Dynamo FC of MLS, the Houston Dash of the NWSL, the Texas Motor Speedway, and the PGA Tour. It is further supported by online sportsbooks Barstool, BetMGM, DraftKings, Fanatics, and FanDuel.

Here is what Jerry Jones had to say about it recently: “A legal and regulated sports betting market is what’s best for Texas and I applaud Senator Kolkhorst and Representative 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 of out-of-state betting platforms.”

With all that support, what could go wrong? As in most other states, there are competing interests in the form of non-sports betting casinos. Even if they plan to get into sports wagering, they generally prefer limiting gambling to casino games and owning a bigger share of a smaller pie. In Texas, Las Vegas Sands is leading a lobbying effort to thwart any sort of stand-alone sports betting bill such as the current proposal. Enter Mark Cuban here as he has proposed a joint project with the Sands on a casino adjacent to a new Mavericks arena.

The Future

What can Texans expect to expect if this or similar legislation succeeds and Lone Star state residents get some form of legalization in the semi-near future?

Even if this bill or an amended version passes and gets approved by the voters in November, there are still many hurdles to pass. A Texas Gaming Commission would have to hash out the specifics and go through a licensing and approval process. Thus the best case is the betting windows opening sometime deep in 2024.

Expect all the major sportsbooks to enter the lucrative Texas market thanks to the huge population and the certainly low tax rate, currently pegged at 10%. New York is the largest state that currently allows sports betting and they tax at 51%. New Jersey is relatively large and very gambling friendly and taxes at 13%.

Caesars Sportsbook will absolutely enter Texas and new customers will be able to take advantage of the promo code on the Caesars sportsbook. To expand on this, currently, Caesars offers a bet credit on any loss on the first wager with a maximum of $1250 keep in mind that this amount may change as time passes. For any Win or lose, customers get 1000 Rewards Credits and 1000 Tier Credits, ultimately good for merchandise, further bet credits, and other perks all across Caesar’s worldwide empire.

Who To Wager On

Texas has no shortage of popular pro sports teams to wager on. The Dallas Cowboys will almost certainly draw massive in-state betting interest as their games often have the biggest handles in sports even without state residents joining in from home. The Cowboys are +1600 to win next season’s Super Bowl as per early futures odds at Caesars.

The Astros are also +260 to take the AL pennant and an overwhelming -210 to win a much-improved AL West. The Texas Rangers are one of those up-and-coming teams that could challenge the Astros in the AL West but are only priced at +900 at Caesars. The Rangers are also +2500 in the AL and +5000 to win the World Series.

The Dallas Mavericks look like a serious contender in the NBA, but it is a very crowded field. Despite the Luka Doncic – Kyrie Irving pair-up looking quite imposing on paper, the Mavs sit at +1400 to take the NBA crown, tied for 8th lowest odds in the league and just fifth lowest in the West. The Dallas Stars have had a similar quality season in the NHL and have similar title odds at +1200.

Many states do not allow wagering on in-state college sports. That sort of ban probably would not fly in Texas given the monstrous popularity of college football. The University of Texas will join Texas A&M in the SEC for the 2024 season, and sports betting kicking in time for the 2024 season feels like a realistic goal if some form of the current legislation gets past the finish line. TCU just made the college football final, while Texas, Baylor, Texas Tech, Houston, and TCU have all had recent success in college basketball.

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