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State Commission Keeps Slots, Er, Historical Racing on the Books. For Now.

Tuesday's action at the Texas Racing Commission ended in a push: Four votes for so-called historical racing, four votes against and one abstention. For now, to the chagrin of much of the state's legislative leadership, the TRC's regulations still provide for Texas horse tracks to allow patrons to bet on races that have already happened, on machines that look a lot like slot machines.

Historical racing terminals generally have reels, buttons and lights like slot machines. If you ignore the usually small video screen broadcasting a long-finished race that's been scrubbed of all identifying information, you'd be forgiven for assuming the terminals were slots. The machines offer little handicapping information and exist as a means for people at tracks to place a bet that doesn't require any live or simulcast racing to be happening.

Industry groups view them as essential to survival, a small way to fight back against tracks in neighboring states that offer casino gambling, like Louisiana Downs in Shreveport. People like Texas Lieutenant Governor Dan Patrick, who is a part of the body — the Texas Legislative Budget Board — that controls funding for the TRC, view it as an illegal expansion of gambling in the state.

The TRC voted to allow historical racing in August 2014. In November 2014, before any Texas tracks installed terminals, a state district court ruled that the commission had outstripped its authority, that historical racing was an expansion of gambling, something that requires a two-thirds vote of the Texas Legislature. Several horse tracks have appealed the decision.

In August 2015, under threat of curtailed funding from the LBB, the TRC put historical racing back on the agenda. By four votes to three, with one abstention, the commission kept historical racing on its books. On September 1, with the TRC still unfunded, the state's horse tracks, including Lone Star Park in Grand Prairie, closed. A temporary funding deal was reached to keep the regulatory agency going until February. The can was seemingly kicked. 

Robert Schmidt, the former chair of the TRC, resigned on December 8. The week prior, Patrick sent the chairman a letter urging that historical racing be put on the agenda for Tuesday's meeting. Schmidt wanted to wait until February. He's still on the board, but the new chair is Rolando Pablos, a former chair of of the TRC appointed by Abbott to serve again last week.

Tuesday, Pablos stressed the importance of decisions being made by the TRC and the LBB. “I truly believe this agency is in crisis," he said. Historical racing has been viewed as panacea, he said, but it's now putting horse racing in Texas at risk because of unintended consequences.

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The rallying cry for the racing industry has been built around the court case. They want the court to decide, rather than the TRC caving to pressure from Patrick and Texas Governor Greg Abbott, to dump historical racing on its own.

"We applaud the [Texas] Racing Commission for taking a calm and studied approach to historical racing. We hope the commission will ultimately decide that the hard working families of the Texas horse industry are at least due their day in court," the Texas Horseman's Partnership said in a statement after the vote. "In the meantime, we encourage the LBB to put politics aside and fund the agency in accordance with the will of the Legislature so that [there is] no further damage to an industry already in hard times. 36,000 jobs and the entire horse racing industry are on the line."

Another horse racing advocate at the meeting, Jan Haynes, president of the Texas Thoroughbred Horsemen’s Benevolent and Protective Association, said that there was no "plan B" for the industry. It needs "some sort of gaming revenue" to survive, she said.

After the vote, Pablos said the TRC will take up historical racing again in February. In the meantime, he directed staff to prepare to shut the commission down again if an agreement to fund the TRC can't be reached by then.

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