Wednesday, February 16, 2005

Like the gamblers they hope to attract, pro-slot machine interests are seeking a big payoff from $1.4 million in campaign donations they made in the past two years to statewide and legislative candidates.

Donors put their money on slots

Pro-gambling interests gave Texas candidates about $1.4 million

By JANET ELLIOTT, Houston Chronicle
February 16, 2005

AUSTIN - Like the gamblers they hope to attract, pro-slot machine interests are seeking a big payoff from $1.4 million in campaign donations they made in the past two years to statewide and legislative candidates.

A political action committee of Houston-based Maxxam Inc., owner of two racetracks where video slot machines might be allowed, was the largest single donor among pro-gambling contributors, giving $273,250, according to figures compiled by the Houston Chronicle.

J. Kent Friedman, general counsel of Maxxam, said the companies' PAC is interested in other issues besides gambling.

"Maxxam is a conglomerate with lots of different interests, so we have lots of different political interests as well," Friedman said.

After failing to win support in the last regular session or the 2004 special session on school finance, slot machines have resurfaced as a school-funding option.

Last week, Rep. Sylvester Turner filed the session's first gambling bill. House Bill 897 would allow slot machines, or video lottery terminals, at horse and dog tracks, at Indian reservations and at one location in each of nine areas around the state. Turner, D-Houston, said his bill would raise more than $1.2 billion a year for public schools.

House Speaker Tom Craddick has said he expects legislation authorizing a public vote on slot machines will reach the floor this session. House members who defeated a similar measure last year are gearing up to attack gambling legislation as a threat to the pocketbooks of Texas families.

Any new form of gambling will need a two-thirds vote of the Legislature to be placed on the ballot for voters to decide.

"I wouldn't scratch gambling off the agenda for this legislative session yet. It has a lot of money behind it, and we think the money will only get bigger," said Craig McDonald, executive director of Texans for Public Justice, a group that tracks campaign donations.

Maxxam and other track owners gave a total of $1.2 million. Maxxam joined other track owners last fall in forming Keep Texas Running, a coalition dedicated to legalizing video slots at racetracks. Track owners say they are losing ground to tracks in states that have slots.

Two Native American tribes, the Alabama-Coushatta in East Texas and the Tigua in El Paso, together donated $87,500. Associations representing horse and dog breeders gave $90,035, and representatives of video slot technology companies contributed $68,500. Donations from dozens of lobbyists who represent those interests were not included in the Chronicle's tally.

Maxxam owns Sam Houston Race Park in Houston and Valley Race Park in Harlingen.

Turner reported $4,000 in contributions from pro-slots interests. He received $1,000 from Maxxam PAC and $500 each from company Chairman Charles Hurwitz and Friedman.

Turner also received a donation from Big City Capital, a limited liability company based in Nevada. The company would like to see slot machines legalized in Texas, said Reggie Bashur, a lobbyist for Big City.

Big City Capital gave a total of $150,000 to various legislators and statewide officials.

A previous opponent of slot machines, Turner said he filed the bill and a related constitutional amendment because of the needs of Texas children. Both were sent to the House Ways and Means Committee.

Tina Benkiser, head of the Republican Party of Texas, issued a statement last week calling slots "a corrupt idea from a Democrat lawmaker."

Despite the Texas GOP's opposition to slot machines, large donations were made to the state's Republican leadership.

Maxxam PAC gave $50,000 to Gov. Rick Perry and $80,000 to Lt. Gov. David Dewhurst. Republican and Democratic senators and representatives also received contributions.

Stars Over Texas, a PAC formed by House Republican leaders to support targeted legislative races, received $15,000 from the Maxxam PAC and $50,000 from Big City Capital.