Jack Pratt: The TT Interview

Jack Pratt, chairman of the Texas Gaming Association, has tried for years to convince Texas lawmakers to let voters decide whether to allow casinos in the state. He's back again, proposing a combination of casinos, "racinos" (racetracks with slot machines) and Indian casinos that he and his economists say would bring more than $1.2 billion into the state treasury every year. It would take a constitutional amendment, approved by two-thirds of the Legislature and a majority of the voters, to add casinos to the legal gambling options of bingo, parimutuel wagering at dog and horse tracks, and the state-run lottery. Later today, the House Committee on Licensing and Administrative Procedures will take up a long list of gaming bills, from one favored by Pratt's group to others favored by racetrack owners, bingo operators and others. We asked Pratt about the new proposal, the political environment and the odds. An abridged transcript, selected video clips and a complete audio version of the interview follow.

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Audio: Jack Pratt Sr.

TT: What's your proposal this time?

Pratt: Our proposal would call for eight integrated large destination resort casinos and would also call for the eight tracks that are up and operating to have slot machines, and we've included the three Native American Indian casinos — they would be legal under our bill.

That's really the nuts and bolts of our bill. It's by population, so there would be two in Dallas County, there would be two in Harris County, there would be one in Tarrant County, there would one in Bexar County, and then there would two on the barrier islands, and those two could be awarded to either Corpus Christi, Galveston Island or South Padre.

TT: You've been at this for 10 years. What's new this time?

Pratt: We're only asking the legislators to put that up on the ballot for the people to vote on it in November — we're not asking them to vote up or down on gaming.

The difference this time is that we're in probably one of the highest per-capita deficits of any state ever in this nation. We have a big hole that we have to climb out of, so additional revenues are being sought out by legislators. There are not many sources, but we're a source of new revenue to come into the state to help them balance their budget.

The state needs the new source of revenue, and certainly they could use the new 40,000 or 41,000 new jobs — good paying jobs — they could use that, and new industry that would be a source of revenue for many, many years to come.

TT: Over the years there have been disagreements between the casinos and the Indians and the tracks; are they on the same page this time?

Pratt: The tracks will have their own bill, and the Indians will have their bill. Our bill will be all-inclusive. We've always been all-inclusive.

I don't fully understand. In all of the other states, we always got together and came with a compromise and had a bill, and we've operated very successfully in states where you've got these larger casinos. And they've done very well, and the numbers prove that in every state where you have commercial casinos vs. the slot machines at tracks. Both have operated very well together because we're really dealing in two separate markets to a great degree.

It's been frustrating to me because we've had a lack of the track owners wanting to come to the table compromise on something other than, they want a monopoly on the state of Texas for slot machines and tracks. Obviously, that doesn't fit our industry of commercial casinos.

TT: One objection to this has been, "This really isn't a way for states to raise money." There's a contingent in the Legislature that would make those arguments. What's your answer to those folks?

Pratt: This business has been in existence for over 80 years. There hasn't been a major blowup with this industry, because it is one of the most highly regulated businesses in the world. We're under spotlight 24/7. So, it's worked very, very well. No governor has ever proposed to de-legalize casinos. It has provided a good source of jobs and a good source of revenue, so I really don't know the theory behind, and no legislator has been able to give me any real theory of why this is not an industry that is not acceptable.

This industry is very acceptable.

There's no statistical data that would ever back up the statements that you just presented to me. But I hear you. They say that sometimes.

TT: More than half of the states have legalized this. Is Texas too late? Have we missed a market here?

Pratt: If we tried to do it, a Band-Aid approach of slot machines at truck stops, just slot machines at the racetracks, or whatever combination of those, and we didn't include large destination resorts, then we wouldn't attract anything. We might bring a few of those people who are going outside the borders to come back in, but we could not attract any people from outside the state of Texas because the drawing radius for the slot machines is 50, 60, 70 miles, and the riverboats is about 100 miles. So any other form of gaming other than something such as we've described just doesn't fill the bill. It wouldn't do anything.

If we can bring back the vast majority of the $4 billion that's going outside the state currently — all of those people are looking at each other and looking at us and saying, "Why do we have to leave the state of Texas to enjoy what we're doing?"

TT: How would you assess your chances this time? Are the odds better than what they have been?

Pratt: I think it's better than we've ever seen because of the need for additional revenue and because such a high percentage of the people want to vote on this issue.