Texas Rep Suggests Coastal Casinos to Subsidize State Windstorm Insurance

Texas State Representative Joe Deshotel has proposed a new bill that would create casinos in coastal counties of the state to help with windstorm insurance as well as flooding assistance.

Just a few days ago, Deshotel filed a bill in Texas to see the creation of coastal casinos in order to subsidize the underfunded programs for windstorm insurance as well as assistance for flooding during natural disasters.

The bill would create tax-licensed casinos, with a portion of casino revenues to cover the Texas Insurance Agency costs.

New proposal

Within this proposal, Deshotel would place the Texas Lottery Commission in charge of issuing six licenses for casino gaming in six counties of the state. Of the revenue generated from the casinos, 18% would be created as a gaming tax and a portion of the money used to ensure that the Texas Insurance Agency had enough capital to cover operating costs and insured deficits.

A similar bill was created by Deshotel in 2015, but was unable to gain any ground. His latest attempt will also see a portion of the tax set aside as a trust fund for flooding assistance. This fund could then be used by the state as emergency assistance when natural disasters occur, such as with Hurricane Harvey.

Deshotel stated: “Just like the lottery, where a portion of funds go to public education, this is a need that’s underfunded. If the lottery helps education, we can help with the problem of windstorm, which is disproportionately paid for by the coastal counties.”

With the announcement of the proposed legislation, Deshotel stated that he anticipated that the bill would be subject to opposition. He feels that whether the funds are dedicated to the issues he listed or not, legalizing casino gaming is something the state should do regardless.

Deshotel pointed out that every state that borders Texas has legalized gambling and the state loses out on millions of dollars in potential tax revenues to those states. The next legislative session will begin in Texas on 8 January and Deshotel is hoping to have enough support to see his measure move forward.

Current landscape

The gambling laws in Texas are very strict. The state has legalized horse racing and greyhound dog racing, plus the lottery, but casino gaming is illegal. Native American lands are not subject to the gambling laws of the state, so players do have access to gaming via tribal venues.

Because gambling laws are so strict in the state, only the Kickapoo Lucky Eagle Casino is considered a legitimate casino, operated by the Kickapoo Traditional Tribe of Texas.

While two additional tribal-operated venues, the Speaking Rock Entertainment Casino and the Naskila Gaming venue, are located in the state, both are subject to litigation as the state believes these venues are illegal.

Texas is a huge state that could certainly benefit from legalized casino gaming. There are millions of dollars to be made from a legalized casino gambling industry with the majority of states in the US having legalized gambling in some form or fashion.

If the bill proposed by Deshotel is passed into law, the state would be able to generate funds to assist with natural disasters and other needs.

How much money could be generated is anybody’s guess. Estimates have not been provided as of yet. Taking a look at big large gaming areas in the US can give us an idea though.

Take for example, the state of Nevada. Of course the region has an established gambling market and has been able to generate large amounts of tax revenues each and every year.

The most recent figures available come from the month of October. Gambling regulators reported that casinos of the state were able to win over $1bn from gamblers that month. Around $57m in percentage fees based on taxable revenues was generated in October, a 4.7% decrease when compared with October 2017.

Overall, there is money to be made in Texas by adding legalized casino gambling. It will be interesting to see if the new proposal will gain any support and if Texas will join in with its neighbors and offer legalized gaming options.

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