Missouri House of Representatives Passes Sports Betting Legislation
Legalized online sports betting has never seemed like more of a reality in Missouri. On Thursday, the Missouri House of Representatives passed HB 2502, known as the sports wagering bill, by a 115-33 vote. As of early 2022, Missouri was one of just 17 states that had yet to pass any form of legalized sports betting, but that appears to be on its way to changing.
What Does HB2502 Entail?
Under the bill passed in Missouri’s House of Representatives, the state is expected to have a very open and competitive market. The six professional sports teams and 13 casinos in Missouri would be eligible for sports betting licenses. Each casino would be allowed to have one retail skin and up to three online skins, meaning it could partner with three separate online platforms. Each sports team would be permitted to have one online skin and could partner with sports betting companies.
Per Ryan Butler of WagersUSA, the following sportsbooks have direct market access deals in Missouri and are expected to be among the first platforms launched in the state once the market is open: Bally Bet, Barstool / theScore, BetMGM, BetRivers, Boyd Sports, Caesars, DRF Sports
The bill allows bettors in Missouri to place wagers on professional and college sports, including in-state collegiate programs. Other states have prohibited bettors from placing wagers on in-state colleges. Bettors would also be prohibited from placing wagers on prep sports.
Tax Rate Shifts in HB2502
HB2502 also presents an 8% tax rate on gross gaming revenue from sports betting activity, which would be one of the lowest in the country. That 8% rate is lower than even what casinos and sports teams were pushing for, and it’s lower than the expected 10% rate. Some states such as New York have recently approved tax rates over 50%, so the Missouri market should be very appealing for operators with a low cost of operation.
In order to generate more revenue in light of the lower tax rate, license fees have been increased from $100,000 to $150,000 along with an annual renewal fee of $125,000, but that pales in comparison to what a significantly higher tax rate would have represented. For example, Tennessee, which has a fairly similar population to Missouri, collected $3 million in tax revenue in February with its 20% tax rate on gross gaming revenue.
The Senate is currently considering a handful of bills, including some that would give lottery retailers licenses and would tax gross gaming revenue at a much higher rate of 21%. In order for sports betting to become fully legalized, each chamber needs to pass identical bills for the Governor to approve. The gap between the proposed tax rate is currently the biggest obstacle between the two chambers.
Timeline for Missouri Legislation
HB2502, sponsored by Representative Dan Houx, was approved in the House of Representatives. Now, it needs to pass through the Senate and be signed by Governor Mike Parson before the state can be able to launch its online sports betting market. The first sports betting bill in Missouri was presented in 2018, but it never made it to a vote in the House as it included other areas of gaming. The new bill strictly covers sports betting.
The next step for Missouri is likely for the House and Senate to form a joint committee regarding sports betting to bridge the gap between their differing bills. Missouri’s legislative session ends on May 13, so there is plenty of time for the two chambers to work through their differences. In the meantime, Missourians can get excited about the most significant progress the state has made on sports betting legislation to date.
Missouri House passing the sports betting bill today is a big deal, BUT:
– The Senate must pass an identical version of the bill, which is no sure bet
– The BEST case scenario for BetMGM/DraftKings/Caesars/FanDuel/Barstool/whoever to go live is early football season 2022
— Ryan Butler (@ButlerBets) March 24, 2022