As far as states go, Kansas doesn’t get much attention. But, at the tail end of last week, the entire sports betting universe was fixated on the Sunflower State as the legislature attempted to push a sports betting bill across the finish line before the unofficial end of the legislative session.
The effort came up short, with the Senate adjourning in the night without an affirmative vote on the compromise bill.
But hope is not lost. The Senate will reconvene on April 25 for a veto session. This is when the sports betting legislation will hopefully get a second look.
In his 2004 bestseller, Thomas Friedman asked, what’s the matter with Kansas? Sports bettors are now asking a similar question, what is going on in Kansas? Here’s what we know.
Where Kansas Sports Betting Currently Stands
When the Senate returns on April 25, the best-case scenario is it will pass the exact version of the sports betting bill passed in the House on Friday. If that comes to pass, the legislation will go to Gov. Laura Kelly’s desk. If the Senate amends the bill, it will need another affirmative vote in the House. And, of course, the Senate could decide not to pass the bill, effectively killing sports betting legalization in 2022.
There is every reason to believe Kansas Senate will pass the legislation as lawmakers reached compromises in a joint conference committee.
The critical issues specific to sports betting resolved during the conference committee were:
- Settling on a middle ground tax rate of 10%.
- The authorization of sports betting kiosks at up to 50 locations.
- Pinning down problem gambling funding at 2% of tax revenue.
- Earmarking 80% of adjusted sports betting revenue on attracting a professional sports franchise to Kansas.
However, the compromises on non-sports-betting issues likely made the difference. Those issues were:
- The online lottery and ADW greyhound racing decoupled from the sports betting legislation.
- The allowance of historical horse racing (HHR) machines at a pari-mutuel facility in Sedgwick County.
Other noteworthy components of the bill include:
- Authorization of retail sports betting at Kansas’s four casinos and the ability to partner with up to three online sports betting platforms. The legislation also allows a casino to add a fourth online skin through a partnership with an in-state professional sports team.
- Casinos may enter into up to 50 marketing agreements to place sports betting kiosks or interactive lounges at approved facilities in Kansas. The state will give preferential treatment to professional sports teams and the Kansas Speedway, and 8% of a casino’s marketing agreements must be with fraternal and veterans organizations.
- Mandates the renegotiation of tribal compacts to include sports betting.
- Allows wagers on collegiate sports, including in-state teams and special events.
- Allows prop bets and other forms of wagers.
The low operator burdens an open market structure with as many as 13 online operators. This will attract the big names in US sports betting like DraftKings, FanDuel, BetMGM, and Caesars.
The Kansas Sports Betting Market
Kansas is a large state, ranking in the top third of states (15th) in terms of area, but it’s in the bottom third in terms of population (36th) with just 2.9 million residents.
That said, Kansas is an essential addition to the legal US online sports betting landscape. Gross gaming revenue estimates for Kansas indicate a market worth around $100 million annually, despite its lack of professional sports teams. Suppose Kansas can slightly overperform and put up Iowa-like numbers (a state with a similar population base and economic factors). In that case, the market could reach as high as $150 million in GGR annually.
Working in its favor, Kansas has a rabid NFL fanbase even if the team resides just across the border in Missouri, not to mention several big-time colleges, like the Kansas Jayhawks and Kansas State Wildcats. The state’s plan to use sports betting money to attract a professional team could also pay off, in which case the legalization will be an even bigger win for the state than the direct tax revenue it receives.
Does the Movement in Kansas Spur on Missouri?
The situation in Kansas could also help light a fire in neighboring Missouri. As my colleague Ryan Butler has mentioned many times, there is an open cross-state rivalry between Kansas and Missouri and a “keeping up with the Jones’s” attitude among legislators.
I think I can say I've watched legislative hearings for the majority of states, but I know none talk about another state more than Kansas and Missouri. I'm increasingly convinced that if Kansas gets its sports betting bill across the finish line Missouri will soon follow https://t.co/jTcMndgb2u
— Ryan Butler (@ButlerBets) March 30, 2022
With a population double that of Kansas at 6.1 million, and a trio of storied franchises in the St. Louis Cardinals, St. Louis Blues, and Kansas City Chiefs, Missouri is one of the biggest sports betting prizes still available. The Show-Me State’s sports betting efforts are expected to resume this week.
