Sports Betting Bill Passes House To Set Up Conference Committee

KS House passes sports betting bill

The Kansas legislature appears on its way to finalizing legislation to legalize sports betting by the end of the week after House passage on Wednesday.

Following a committee kerfuffle the prior day, Rep. John Barker surprisingly called Senate Bill 84 on the House floor and substituted his new Kansas sports betting language introduced last week.

The substitute passed 88-36, sending SB 84 back to the chamber that passed it last year. The original bill was crafted by the Senate Committee on Federal and State Affairs, chaired by Sen. Robert Olson.

A conference committee to work out the differences between the House and Senate versions has been set for Thursday at 9 am local time. Barker and Olson will chair the committees. Also on the committee are Rep. Tory Arnberger, Rep. Louis Ruiz, Sen. Richard Hilderbrand and Sen. Oletha Faust-Goudeau.

A legislative source tells PlayKansas that Olson and Barker intend to work out their differences on the bill before the legislature breaks Friday. The legislature returns for a veto session in late April, and the conference committee could take until May 20, though it does not appear that will be necessary.

Rep. Barker circumvents committee mess

On Tuesday, sports betting appeared to hit a roadblock in the House Committee on Federal and State Affairs. Barker had introduced HB 2740, an agreement reached with all Kasino gambling stakeholders.

He attempted to add four amendments with the intention of voting the bill out of committee and bringing it to the House floor.

Three amendments passed: one banning gray machines, one changing the requirement for casinos to enter marketing agreements with 10 veterans/fraternal organizations to 20% of agreements entered, and cleaning up technical language regarding skins.

But an amendment removing a provision allowing online lottery ticket sales faced opposition. Several committee members spoke up against removing language that provided about $10 million annually to the state in the fiscal note.

After the amendment failed, a motion was made to reconsider. The motion to reconsider failed 10-12.

Barker glared in someone’s direction and said: “I am surprised. We are adjourned.”

Rather than deal with the issue in committee again, Barker simply added the language he wanted to the Senate bill that already was on the House floor.

Problem gambling amendments made on House floor

Rep. Victor Miller made an amendment in the committee that passed related to responsible gambling. But there was one problematic part of the amendment. It required that 2% of gross gaming revenue from sports wagering and casino gaming went to the Kansas Problem Gambling and Addictions Grant Fund.

By hitting the reset button and substituting on SB 84, more industry-friendly amendments were made by Miller and Rep. Adam Thomas on the House floor. Collectively, they:

  • Prohibits casinos from taking sports wagers on credit, including the use of credit cards.
  • Requires responsible gaming language and tools setting limits to be displayed at sportsbooks and sports betting kiosks.
  • If someone on the self-exclusion list does place a bet, the winnings are forfeited and go to the Problem Gambling and Addictions Grant Fund.
  • 2% of state tax revenue from sports betting goes to the Problem Gambling and Addictions Grant Fund.

Making it 2% of state tax revenue also aligns the House bill with the previous Senate language.

Kansas House sports betting language

Here are some of the main details of the sports betting bill passed by the House:

  • Allows Kansas’ four casinos to have retail sports betting and each partner with up to three online sports betting platforms.
  • A casino may request approval of one additional skin to go through a professional sports teamSporting KC, a Major League Soccer club, is the only professional team in the state.
  • Tax rate of  20% for online wagers and 14% for bets placed at casinos.
  • The Kansas Racing and Gaming Commission will oversee sports betting regulation.
  • Allows for wagering on professional, collegiate and motorsports, or special events authorized by the commission.
  • Sets a minimum age requirement of 21 to wager on sports.
  • Allows each casino to partner with up to 50 retailers to provide sports betting kiosks.
  • Requires the governor to renegotiate new compacts with Native American tribes to include mobile and retail sports wagering.

Differences for conference committee to work out

The House changes aligned with many points of the original Senate bill, including the three online skins for each casino.

The compromise between industry entities brings additions including the ban on gray games and allowing the Phil Ruffin-owned racetrack property in Sedgewick County to have historical horse racing with a maximum of 1,000 machines.

Given that Barker worked out these issues with industry stakeholders, they wouldn’t appear to be issues for the Senate.

“Today was an important step in bringing legal sports betting to Kansas,” said Jeff Morris of Penn National Gaming. “We are hopeful that the conference committee can finalize a bill that will allow Kansas to compete on a level playing field with their neighboring states that have legalized sports betting or, in the case of Missouri, are in the process of trying to do so this session.”

The big point of contention is bound to be the tax rate. The Senate bill taxes in-person wagers at 5.5% and online wagers at 8%.

On the House floor, Barker noted the large difference in tax rate and expressed a willingness to find a middle ground.

“I will tell you, in the Senate version they have 5% and 8%,” Barker said. “Somewhere in between is probably a fair amount. Preferably our side, not their side.”

Photo by Charles Rex Arbogast / Associated Press