Kansas Could Lose Gaming Taxes if Missouri Legalizes Betting

Potential Revenue Decline

Kansas may experience a significant decrease in gaming tax revenue if Missouri voters approve a constitutional amendment to legalize sports betting, warns Kansas Budget Director Adam Proffitt. The change could reduce cross-border wagering by Missouri residents who currently bet in Kansas due to its earlier legalization of sports gambling.

Proffitt highlighted the current trend of Missouri residents driving across state lines to place bets through platforms like DraftKings, FanDuel, and BetMGM. “There’s a host of cars literally lined up on the Kansas side — they’re on their phones placing bets on football games,” Proffitt observed during an economic outlook conference at Washburn University.

Kansas’ Sports Betting Earnings

Since legalizing sports betting in September 2022, Kansas has collected $18.2 million in taxes. Betting platforms have generated $182 million in revenue from $4.1 billion in wagers. In August 2024 alone, Kansas took in $657,000 in tax revenue from sports betting, an increase from $484,000 in the same month last year.

Proponents of Missouri Amendment 2, which will be decided in November 2024, estimate that the state could collect $4.7 million in tax revenue in its first year of legal sports betting, growing to $38.7 million annually by the fifth year. If passed, Missouri regulators would be tasked with setting up a sports gambling network by December 2024.

While Proffitt did not provide an estimate of how much Kansas might lose in gaming revenue if Missouri’s amendment passes, he emphasized that cross-border betting could see a significant shift. The state’s general fund has authorized $10.5 billion in spending against $9.7 billion in forecasted revenue for the current fiscal year. Proffitt noted that Kansas’ cash reserves would cushion the deficit, stating, “Really critical to note, we had a lot of one-time projects scheduled. We have a strong ending balance.”