By Lynn Ashby 24 January 2010
The Size of Taxes
If you like magic, visit our state capitol and see what the Legislature can do with smoke and mirrors. The lawmakers have to fill a budget gap of between $17 billion and $25 billion to run Texas over the next two years. (The next proposed biennium’s budget is $156.4 billion.) But the Republican majority has promised a balanced budget with no new taxes.
This means cutting the budget — Texas already ranks 50th, dead last, in per capita state spending – or finding new revenues. Gov. Rick Perry says the projected $9.4 billion Rainy Day Fund will not be touched until water reaches the top of Yao Ming or the peak of the capitol dome, whichever comes first. The GOPers can increase college tuition, raise fees on car plates, fishing licenses and polluting smokestacks (forget that one), or boost the franchise fee on tattoo parlors and confessional booths.
None of these increases would be called “taxes,” but one lawmaker is introducing a bill to call fees exactly what they are: taxes. That’s a good idea. I am tired of politicians saying that they lived up to their pledge not to raise taxes when, in fact, they did, by any other name.
Timing is everything, so into this conundrum rides an old acquaintance: casino gaming (or, just as “fees” are really “taxes,” “gaming” is actually “gambling.”) Proponents of these games acknowledge that they have a chance of finally succeeding only because Texas is in dire economic straits. Our legislators are pulling out sofa pillows looking for loose change. They’re returning the empties, and are considering coin-operated spittoons. Hello, Mister Chips.
The gamblers have their work cut out, but this ain’t their first rodeo. In session after session, various types of gaming have been proposed – and have been shot down. The last effort was in 2007 when casino supporters promised to funnel some of the money to fund college scholarships for more than 200,000 high school graduates. Didn’t work. Now one group wants to put slots at the 13 tracks and three Indian reservations. This, it is argued, would generate $1 billion a year for Texas’ treasury. A more aggressive plan is to open up four to eight Las Vegas-style casinos around Texas.
This last plan is very specific: Three casinos would be in the largest counties — Harris, Bexar and Dallas — and at least one other would be in a coastal town. I have long thought a casino is the perfect, and perhaps the only, solution for what to do with the Astrodome. As for the unnamed costal town, Galveston has always been a fun sort of island, at low tide, so building casinos along the beaches is a (excuse the cliché) no-brainer. But Corpus Christi or Padre Island could also be a site.
We must now consider Texas’ race tracks, which are in deep financial trouble. Their owners say that if the race sites don’t get slots at the least, the operations may go under. It’s not just a Texas problem. Wagering on U.S. horse races fell by 7.3 percent in 2010 to $11.4 billion, the lowest since 1995. Race wagers have fallen annually since reaching a record in 2003 of $15.2 billion.
But remember that the horse-and-hound track owners received permission to build their tracks in the 1980s by promising the industry would generate tons of cash for the state. A few years later the track owners went to the Legislature saying business was worse than promised. They asked that the state’s cut be lowered so the owners could keep more of the take. This happened more than once. Alas, the bountiful harvest from the race tracks never came about, so anything promised or proposed by the horsey-doggie set must be met with skepticism.
Right now, Texans can’t gamble. Actually, we do gamble a lot (or a Lotto). We already have the state operated Lotto, scratch-offs, Texas Two-Step and other such games. We also have bingo parlors, dog races, pari-mutuel horse racing plus televised races from all over to bet on, and the biggest gamble of all, breathing in Galena Park. We also gamble at the closest roulette wheel, which means out of state. If you took out a map of Texas, then put a poker chip at every casino surrounding it, you would see, uh, Texas is surrounded by casinos.
It is estimated by Win For Texas, a pro-gaming outfit, that Texans spend some $2 billion annually at racetracks and casinos in surrounding states. That’s low-balling it. Check any parking lot at any next-to-Texas casino and I’ll bet 80 to 90 percent of the license plates read “Texas.” When Indians opened a bunch of casinos just north of the Red River, it hurt casinos in Louisiana. They are all drawing from the Metroplex, and, no, they don’t play Oklahoma Hold ‘Em.
Thus far we’ve have only been discussing nearby sin sites. You can’t walk across a casino floor in Las Vegas without bumping into a fellow traveler from the Lone Star State. Indeed, there is even a house of cards in Vegas called “Texas.”
We shall probably not see a vote on expanding gambling, but this may not be bad. Otherwise we would be subjected to a barrage of: headlines: “Odds Are Poor for Gambling,” “Casino Vote is Horse Race,” “Gambling Outcome is a Roll of the Dice” and “Slots O’ Luck.”
Finally, a point to ponder: a recent poll commissioned by all the major newspapers in the state found that 60 percent of Texans desire more games of chance. This could mean anything from slots at race tracks to full-fledged casinos, but the supporters would be glad for any crumb the Legislators toss. However, two-thirds of both houses of the Legislature would have to approve expanded gambling – fat chance — then the voters must approve. Come to think of it, maybe we won’t need more gambling to balance the budget — if the lawmakers can tax smoke and mirrors.
Ashby deals at firstname.lastname@example.org