Kansas’ legal sportsbooks are set to remain online for at least the next two years but the future of the state’s regulatory market could change drastically in that time.
Key takeaways
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Kansas lawmakers overrode a veto to ban new sportsbook license negotiations until 2026, signaling possible major regulatory changes ahead of 2027 license expirations.
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Kansas may shift to a single-operator model or raise taxes, as lawmakers aim to boost low tax revenue from sports betting, which totaled $29 million since 2022.
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Future changes could include reducing sportsbook options, an unprecedented move that may push bettors to offshore sites, especially with Missouri's market launching in 2025.
Kansas lawmakers last week voted to override Gov. Laura Kelly’s veto of a provision that would prohibit state sports betting regulators from negotiating new licenses with existing sportsbooks. This could have presented a scenario where licenses for Kansas’ six books expired without a renewal option, forcing them offline.
The books’ licenses expire on Aug. 31, 2027. The sports betting provision in the bill passed last week ends in 2026, meaning the legal sportsbooks aren't in immediate jeopardy of shutting down.
Including such a prohibition indicates lawmakers will reconsider the existing sports betting regulatory structure when the 2026 session convenes next January.
Kansas sports betting background
Kansas approved legal sportsbooks in 2022. Kansas law requires all gambling-related entities, including the Sunflower State's four brick-and-mortar casinos, must be under the state lottery’s purview.
Sportsbooks seeking Kansas licenses had to partner with one of the four lottery-run casinos. The current books are: BetMGM, Caesars, DraftKings, ESPN BET, Fanatics and FanDuel.
But I wouldn’t let the Kansas legislature off so easy. They had no idea when these contracts expired and were willing to take your favorite OSB apps away from Kansans. We’re not going to let that happen.
— Jeremy Kudon (@JKudon) April 11, 2025
Each book pays a 10% tax on gross gaming revenue, one of United States' lower rates. Books can also deduct promotional expenditures such as free bets from their revenue totals.
Kansas' six legal sportsbooks accepted nearly $6 billion in bets, generating roughly $539 million in income and about $29 million in taxes for the state.
Kansas has one of the lowest per capita tax generations of the 30 states with legal statewide mobile sports betting.
Potential Kansas sports betting changes
Some lawmakers want to increase sports betting tax revenues, sources in Topeka told Covers ahead of last week’s vote.
One proposal would create a potential sole-source operator model under the lottery. It’s unclear if that means a de facto monopoly for an existing third-party commercial sportsbook or a new lottery-branded operator unavailable in other states.
Proponents of such a structure argue the lone book would pay a much higher tax rate and generate more funds for the state. DraftKings, the only legal operator in New Hampshire, pays a 51% tax on gross gaming revenue, the U.S.' highest rate.
Opponents argue limiting the market would curtail revenues by dispelling customers and forcing them back to offshore books that don’t pay taxes. They point to the since shuttered lottery-run, single-source model in Washington, D.C. as an example of this policy’s failure.
It would be unprecedented for a state to force out licensed sportsbooks. Though dozens of brands closed on their own volition, a state has never repealed an existing regulatory structure.
Lawmakers could also take a less radical approach by raising taxes. Industry lobbyists have advocated for rates between 10 and 20%, meaning there may not be significant pushback even if Kansas doubled the existing rate.
Only two states raised sports betting taxes: Ohio, which doubled from 10% to 20% and Illinois, which scraped its 15% rate for a multi-level rate based on revenue tiers.
It’s far too early to tell what Kansas lawmakers will propose with the state’s sports betting market next year. It’s also no sure bet the legislature will reach a consensus on a bill.
The Sunflower State must also deal with the Missouri's fall 2025 mobile sportsbook launch, which could attract bettors across the border if there's a dramatic alteration to the current sportsbook offerings. Missouri could have as many as a dozen legal books take bets this year.
Most bettors wouldn’t notice if the state increases sportsbooks’ revenue taxes. But a possibility remains in the coming years that Kansas could reduce its available sportsbooks, an unprecedented move that didn’t seem like a remote possibility before the legislature’s vote last week.
