Voters will have a say this fall over whether to legalize sports betting in the Show-Me State.
Missouri Secretary of State Jay Ashcroft’s office announced Tuesday that a proposed amendment to the state’s constitution, which would authorize in-person and online sports betting, will be on the election ballot this November.
The group behind the ballot measure, Winning for Missouri Education, submitted more than 340,000 signatures for their initiative petition to ensure voters decide the matter.
Those voters will have to ponder a specific model backed and supported financially by the state’s professional sports teams and at least two online sports betting operators, DraftKings and FanDuel.
There were technically multiple sports betting-related initiative petitions approved for circulation this election cycle in Missouri. However, only one of the proposed constitutional amendments will go on the ballot.
That amendment will ask voters if they want to allow entities licensed by the Missouri Gaming Commission to offer sports betting at one of the state's casinos, in and around professional sports venues, and using apps and websites.
It's (potentially) a big day tomorrow for legal sports betting-wanters in the Show-Me State
— Geoff Zochodne (@GeoffZochodne) August 12, 2024
Will Sports Betting Be on the Ballot in Missouri This November? https://t.co/CurMpSvNNs @Covers
If a majority of voters approve, bettors would have to be 21 or older. However, those Missouri bettors would be prohibited from wagering on college player props involving games in which Missouri schools are playing. Other than that, Missourians would have a wide selection of betting markets under the new law.
The start date for legal Missouri sports betting could be no later than Dec. 1, 2025, according to the proposed amendment. It would have to be a simultaneous launch of retail and online wagering as well, not one or the other first, as some states have done.
There would be multiple online sportsbooks to choose from. Under the proposed amendment, Missouri’s casinos and professional sports teams could partner with sports betting operators to offer retail and mobile event wagering.
The commission could issue one retail license apiece for a casino, team, or their designated sports betting operators. Mobile sports betting licenses could be awarded to casino owners, teams, and the operators doing business on behalf of the casinos and teams, although only one sports wagering operator could conduct business on behalf of a casino owner with more than one property in the state.
The commission could also issue up to two standalone licenses for online sports betting in Missouri that would not be tied to a casino or team. While DraftKings and FanDuel have been financing the group behind the ballot measure, the proposed amendment notes that if there are more than two applications for the untethered licenses, the regulator would use criteria such as expertise, experience, and revenue potential to decide the recipients.
An entity could also have more than one license but it would have to use "distinct" brands for each. Moreover, the proposed amendment makes it clear that commercial contracts agreed upon between teams and operators could allow the team or sports governing body to share in the money being wagered on their games.
The tax man cometh
Sports betting revenue would be subject to a 10% tax. Most of those funds would be used to bankroll education in the state, but they would also be dedicated to help cover the costs of regulating sports betting and to fund problem-gambling programs. A new “Compulsive Gaming Prevention Fund” would receive either 10% of annual tax revenues or $5 million a year, whichever is greater.
Operators could deduct free bets and other promotional play from their taxable revenue, but deductions would be capped, limiting their amount to 25% of an operator's monthly handle.
The tax would be in addition to the licensing fees paid. An applicant for a retail sports betting license would have to fork over as much as $250,000 for the permit, which would have to be renewed every five years for a similarly sized fee. The cost for an online license could be up to $500,000 and would likewise require renewal every five years for a similar price.
All sports wagering fees would go to cover the costs of the gaming commission to regulate the industry, and after that, the money would then flow to the state's Compulsive Gaming Prevention Fund.
According to the official ballot title, the state estimates the proposed sports betting model would have one-time costs of $660,000 to get off the ground and ongoing annual costs of at least $5.2 million. That would be offset by upfront licensing fee revenue of $11.75 million and the taxes paid.
“Because the proposal allows for deductions against sports gaming revenues, [state governmental entities] estimate unknown tax revenue ranging from $0 to $28.9 million annually,” the title adds. “Local governments estimate unknown revenue.”
The proposed amendment also lays out some standards and rules that operators would follow, such as ensuring they report any "abnormal betting activity" and a requirement that minors or self-excluded residents are not purposefully targeted by advertising. The commission could fine anyone who runs afoul of the rules up to $50,000 per violation or $100,000 for a violation "of the same occurrence of events."
