With Chiefs in Super Bowl, MO revives sports betting debate as gamblers cross into KS

When the Kansas City Chiefs face the Philadelphia Eagles in the Super Bowl on Sunday, Missourians who want to bet $20 on their hometown team will have to leave the state to place a legal bet.

Five months after Kansas legalized sports gambling, a Missouri team is riding high — but Kansas businesses are the ones reaping the reward.

“They’re gonna go watch the game at some sports bar in Kansas — Buffalo Wild Wings, whatever it might be, and inject money into those local economies when they could be doing it here in our state,” said Missouri state Rep. Kurtis Gregory, a Marshall Republican.

The Chiefs postseason success has only compounded the frustration. Advocates of legal wagering are hoping — if not exactly betting — that Missouri’s relegation to the sidelines during the Super Bowl will spur lawmakers to finally reach an agreement this year on legalizing and taxing sports betting.

Legislators in both parties say Missouri is missing out on millions of dollars of tax revenue, particularly from fans who can now travel to neighboring states like Kansas and Illinois to place bets.

“It does pain me that people are going to go to that wretched state and spend money,” said Missouri Senate President Pro Tem Caleb Rowden, a Columbia Republican, referring to Kansas.

Nationwide, a record 50.4 million adults are expected to bet $16 billion on the Super Bowl this year, according to the American Gaming Association. That estimate is 61% more than what the association predicted last year.

This week, as lawmakers in the Missouri House donned Chiefs gear ahead of the Super Bowl, sports betting legalization is still up in the air.

The Missouri House Emerging Issues Committee on Wednesday is scheduled to hear two bills that would legalize and tax sports gambling. The bills, filed by state Rep. Dan Houx, a Warrensburg Republican and state Rep. Phil Christofanelli, a St. Peters Republican, are identical.

Both bills would impose a 10% tax rate on sports bets. Revenue generated from the tax would be disbursed to the state’s gaming education fund. Under both bills, sports betting would be overseen by the Missouri Gaming Commission, which regulates riverboat casinos and charity bingo games.

“I believe there is momentum — it’s just kind of going through the process, going through the sausage-making,” Houx told The Star. “We heard from our constituents on both sides of the aisle say, ‘Why can’t you guys get sports betting done?’ We’re listening to them. We’re doing everything we can do. It’s just a process.”

While Kansas politicians heralded the legalization of sports gambling last year, the additional tax revenue coming into the state has been relatively modest.

The Kansas Legislature set a tax rate of 10%. Between Sept. 1, when betting became legal, and the end of December, Kansas collected about $2.1 million from more than $718 million wagered because the tax is on net revenues, which are far less than the amount wagered.

The state puts 80% of the revenue it receives toward a special fund to lure professional sports teams to the state, but it will take years for the fund to accumulate even $10 million. The amount is far less than what many anticipate would be needed to sway the Chiefs or a similar team to the state.

Kansas Gov. Laura Kelly, a Democrat who signed sports betting into law, last year acknowledged the possibility of tweaking the state’s sports betting law and some lawmakers have said the fund may eventually be eliminated. But there have been few indications that legislators are planning to reopen the debate over the law this year.

In Missouri, the major disagreement over sports betting isn’t so much on actual sports betting, but instead on whether legislation should also address controversial lottery machines, called video lottery terminals.

The dispute, which has divided lawmakers, comes as the unregulated gambling slots have popped up across rural Missouri over the last several years — at gas stations, truck stops and fraternal organizations. Attempts to regulate those gaming machines, which some prosecutors consider illegal, have previously complicated the state’s push to legalize sports betting.

The machines are often referred to as “gray games” because of their murky legal status.

State Sen. Denny Hoskins, a Warrensburg Republican and longtime supporter of legalizing and taxing video lottery machines, has pointed to Kansas’ modest returns as a sign that Missouri should include the machines in its sports betting legislation. He filed a bill this year that combines the two issues — arguing that slot machines would allow the state to bring in an additional $250 million in revenue each year.

“You see a lot of these gray games out there at convenience stores, truck stops, fraternal organizations, bars and taverns,” Hoskins told The Star. “My bill would give them a legal, regulated path in order to be here in the state.”

Hoskins’ bill would also tax sports betting at 10%.

Rowden said he does not think the two issues should be legalized together. But he said he would vote in favor of legalizing the machines if it meant legalizing sports betting.

“I’m agnostic on that — the will of the body is going to decide that,” he said. “They should be separate issues, but it doesn’t seem like that’s going to be the path we’re going to be able to take.”

While much of the public discussion surrounding legalized sports betting in Kansas and Missouri has sidestepped the issues of problem gambling, the Missouri bills also require that money be set aside to combat compulsive gambling.

The bills from Houx and Christofanelli call on the Missouri General Assembly to appropriate at least $500,000 to combat problem gambling. Hoskins’ bill goes a step further and calls on the legislature to appropriate at least $5 million each year towards compulsive gambling.

Late last year, The New York Times published an investigation into the gambling industry. The newspaper, among other findings, found that the sports betting industry had devised ways to persuade people to keep betting even after they lose money.

It also reported that tools to make it easier to quit — some run by gambling companies, others by states — did not always work. In Indiana, for example, people who sought the government’s help to prevent them from gambling found that they were still able to place bets.

State Rep. Jerome Barnes, a Kansas City Democrat, said he’s in favor of legalizing sports betting because his constituents want it. He said he hates that Missouri lost to Kansas in the race to legalization.

“Missouri has sort of been wait-and-see,” he said. “When we have the opportunity to get out on top of things, it’s like we don’t want to take that leap and do it first.”

Missouri Senate Minority Leader John Rizzo, an Independence Democrat, said he would be considering traveling to Kansas to bet on the Super Bowl if the Chiefs weren’t in it. He has a rule against betting on his hometown teams.

Still, he’s frustrated for his family and friends in Missouri.

“I know that a lot of my friends and definitely family members would love to be able to just sit at home and make their bets,” he said. “Now they’re going to probably be shifting all their money over to Kansas.”