Just another kick in the teeth

Oct. 27, 2011 - The Texas Racing Commission has begun informing out-of-state wagering companies that it's now illegal to accept online horse or greyhound bets from Texas.

In effect since Sept. 1, HB 2271 also outlaws phone wagers from this state.

On Oct. 14, TRC executive director Chuck Trout wrote nine out-of-state wagering companies about the legislation. Texas Attorney General staff consulted with the TRC on the letter's contents.

The letter presented HB 2271's requirements but set no compliance deadline. Asked if a letter recipient requests additional time for its attorneys to review the law, a TRC spokesman declined to comment on hypothetical situations.

According to the TRC, letters were sent to Twinspires.com (a Churchill Downs affiliate), XpressBet, AmWest Entertainment, USOff-Track, eBet, Premier Turf Club, The Racing Channel, PayDog and Racing2Day.

TRC later learned of another possible HB 2271 violator, Darkhorsebet.com. A letter will also go out to that organization.

Penn National Gaming, which began to take its half-interest in Sam Houston Race Park 13 months ago, owns eBet.

Advance deposit wagering accounts enable the out-of-state betting process. Using a credit card or bank transfer, a bettor establishes an ADW balance with one of the companies. Rather than drive to a track, a Texas resident can use the account to wager from home or work, primarily by computer. The online wagering company then adds winning bets to, and subtracts losing bets from, the account.

About four of every five dollars bet on a U.S. horse race is wagered from another track (simulcasting), a casino, an off-track "parlor" or an ADW account.

The present status? Several Houstonians report they continue to wager with out-of-state companies.

ADW accounts siphon revenue from Texas tracks and Texas governance. A Texan wagering from home on a New York race through a Kentucky ADW account excludes Texas from the transaction. This state gets a revenue slice only if that race occurs at a Texas track.

According to SHRP president Andrea Young, neither Sam Houston nor Lone Star Park officials lobbied for HB 2271. Young said there were attempts to include Texas tracks in the ADW revenue stream, not to eliminate ADW accounts.

The TRC's letter cautioned of "enforcement proceedings to impose penalties for violations." In addition, the letter said the Texas comptroller "may examine the books, records, officers and employees of any company authorized or permitted to do business in Texas that is involved in pari-mutuel wagering."

The letter concluded that the TRC "may pursue criminal action against violators under Chapter 7 of the Texas Penal Code."

Read more: The Chronicle