Missouri House Approves Sports Wagering Bill

The Missouri House overwhelmingly approved a bill Monday to legalize sports wagering, with Republicans siding with casino companies to defeat Democratic amendments seeking higher taxes and limits on promotional costs.

The bill needs a formal roll-call vote, expected later this week, to send it to the Missouri Senate. 

With all but three adjoining states allowing sports wagering, the failure of the General Assembly to follow suit in previous legislative sessions is an embarrassment, said Rep. Ashley Aune, D-Kansas City.

As she campaigned last year, Aune said, the question of when lawmakers would pass sports wagering came up repeatedly.

“It seems so simple and our constituents genuinely don’t understand why we haven’t got it to the finish line yet,” Aune said.

The bill given first-round approval is almost identical to the industry-negotiated bill that has been debated over the past two years. It would allow each licensed casino to offer customers three betting platforms, or skins, with a limit of six per casino company. Each of the major league sports teams could contract with a platform to offer wagering branded under their name.

Anyone over 21 would be able to download a sports wagering application to their phone or computer and place bets from anywhere within the state.

The net winnings of sports betting would be taxed at 10%. The net winnings would be calculated after deductions for promotional costs such as free bets intended to draw gamblers.

Democrats tried, and failed, to bump the tax rate higher and to limit or remove the deduction for promotional costs. On every other form of gambling, casinos pay a tax of 21% on their winnings and receive no deduction for money given to patrons for free wagers.

The bill’s sponsor, Rep. Dan Houx, R-Warrensburg, argued against any effort to alter the bill. It already faces stiff opposition in the Senate, he said, and the House needs to show it is united.

The biggest obstacle to sports wagering in the Senate is a push to also allow video lottery games in bars, restaurants and truck stops. Sen. Denny Hoskins, R-Warrensburg, has said the two must pass on the same bill, but sports wagering backers want their bill to pass on its own.

Allowing a deduction for promotional costs will help the newly legal Missouri betting platforms attract customers who are crossing state lines to wager, Houx said.

“We are surrounded,” Houx said. “We have got to do everything we can to get people to bet within Missouri.”

When fully implemented, the bill would bring an additional $21 million to $29 million in revenue benefiting education.

Sports betting is extremely popular, and more than 200,000 Missourians were blocked from making wagers on accounts with gambling platforms from other states during the NFL season. Thousands of Missourians are regularly crossing lines to bet on major events like the Super Bowl or the NCAA basketball tournament. That is costing the state as much or more than the lost revenue from gambling taxes, Houx said.

“The biggest thing we are missing out on is the residual tax” on meals and other purchases, Houx said. “That is even bigger than the small 10% tax rate we are talking about right now.”

Rudi Keller covers the state budget, energy and the legislature in Missouri. This story first appeared on the Missouri Independent, a nonpartisan, nonprofit news organization covering state government, politics and policy.