I always appreciate stories like this, which help me to realize where the current bounds of my cynicism are.
The leader of Texas’ largest business association is endorsing a proposal that would make it more expensive for racetracks to operate slot machines – just weeks after the tracks turned down his offer to promote their interests in a statewide campaign.
Bill Hammond, president of the Texas Association of Business and one of the state’s most powerful lobbyists, recommended to his group’s executive committee on March 18 that it endorse a requirement to auction licenses for slot machines. In a memo, Mr. Hammond wrote that bidding would raise between $2 billion and $4 billion for the state, which would issue the licenses.
But just two weeks ago, Mr. Hammond offered to tout the racetracks’ position – that bids are unnecessary because slot machines would raise plenty of revenue for the state and that tracks, which already feature betting, are a natural home for the machines. Tommy Azopardi, the executive director of the Texas Horsemen’s Partnership, said his group turned down Mr. Hammond’s overture several weeks ago because the group’s budget could not accommodate more lobbyists.
“That is very disappointing that he’d be taking that approach,” Mr. Azopardi said Thursday of Mr. Hammond’s recommendation for an auction.
Mr. Hammond did not return a phone call seeking comment. In a written statement, he said his recommendation is consistent with the association’s philosophy.
Apparently, that philosophy is “Principles, schminciples – it’s the highest bid that really matters.”
“As we have for years, we support VLTs at racetracks and now are also considering supporting the auctioning of VLT licenses,” he said, using an abbreviation for “video lottery terminals,” the technical name for the slot machines. “If TAB were to support auctioning, it would be because it would produce more non-tax revenue for the state.”
Texas lawmakers are considering several proposals to legalize gambling. A popular plan calls for putting slot machines at horse and greyhound racetracks. The tracks, which are losing money, want exclusive rights to operate the machines as a way to boost their revenue.
Some lobbyists and lawmakers have suggested out-of-state casinos are pushing for the state to take bids. In the past, the casinos have opposed slots at Texas racetracks, concerned it would reduce the number of Texans gambling at casinos and racetracks in Louisiana and New Mexico.
“If I was an out-of-state casino, that is the position I would take,” said Elton Bomer, a lobbyist who received Mr. Hammond’s original offer. “I would want to auction off these things, which would give me a better chance of getting them.”
Some lawmakers are uncomfortable with giving an exclusive license to racetracks to operate slots. They say the state is giving up money it could earn by auctioning the licenses to the highest bidder.
Track operators argue that an auction would delay the start of gambling and thus the flow of money to the state. The tracks say they are ready to set up the machines and begin wagering as soon as the Legislature and voting public approve new gaming.
Craig McDonald, director of watchdog group Texans for Public Justice, said Mr. Hammond’s quick change of position makes it “look like Mr. Hammond has put the TAB up for sale to the highest bidder.”
“These types of side deals should be disclosed, so people know that when TAB is speaking, it is speaking out of financial self-interest, rather than for the good of its members,” Mr. McDonald said.
I hear Armstrong Williams is available, if they need some help explaining their stance. Reasonable rates, too.
For what it’s worth, and however Hammond arrived at it, I think this is the correct position to take. If we must have slot machines – and mind you, I’m nowhere close to conceding that point – then I see no reason why licenses for them should be excusively granted to one particular interest. Let the horse tracks compete with everybody else. Maybe they’ll figure out how to make money that way.
If an indictment in the ongoing criminal grand jury investigation into hammond (and Craddick and DeLay and others) wasn’t already a foregone conclusion, this will probably clinch it. There are strict rules governing trade associations. Those rules do not include trying to shakedown business interests that represent the opposite side of an issue your association has endorsed. If the Texas Association of Business board doesn’t dump Hammond now, they (and all the corporations they represent) will deserve what they get.