Sports betting arguably holds the most widespread bipartisan support it’s ever had in the state of Missouri. And yes, early indicators suggest 2023 will be the year of legalization.
But those optimistic for a speedy passage should be cautious.
The case for MO sports betting in 2023
In recent years, discussion over legal sports betting in Missouri has been heating up. Several bills have been proposed in the state legislature seeking to bring the budding industry — and the tax dollars that come with it — to Missouri.
As of yet, though, those efforts have been to no avail.
There was originally reason for optimism in 2022. But unless another special session is called, it likely won’t pass this year after all.
John Rizzo, Missouri Senate Democrat leader from District 11, upon wrapping up more time spent in Jefferson City this last month, expressed that he only wants to return to the state capitol this year if it involves sports betting.
“If there’s any special session I would even entertain coming back for, it would be for sports betting.”
Senator Caleb Rowden (R-District 19) also spoke up about the issue:
“Missouri lawmakers look like fools for not passing a sports betting bill.”
But there is, once again, reason for optimism in 2023.
Missouri Gaming Commission chairman predicts sports betting fate in 2023
Mike Leara, chairman of the Missouri Gaming Commission, expressed his anticipation that sports betting will land on the governor’s desk in 2023.
During a recent interview with KMOX radio in St. Louis, Leara said:
“I think that it’s coming, I believe that it is. That’s why we have been prepared for it . . . I think that the legislature will approve something and get something to the governor’s desk. What that is, there’s just no way to tell.”
Tax rate compromise crucial for sports betting’s passage
Legislators certainly can’t return to Jefferson City in January with the exact same goals they had in the last legislative session, because none of them succeeded. Rep. Dan Houx — one of the state’s biggest sports betting proponents — must now work with Sen. Denny Hoskins and fellow colleagues to find a suitable compromise.
Finding middle ground on issues such as tax rate will ultimately help usher the bill through the General Assembly and on to Governor Mike Parson’s desk.
It’s important to point out that many of the disagreeing parties aren’t against sports betting in particular. Rather, challengers want to ensure the industry is being properly established and that tax revenues will be allocated effectively.
Comparing proposed tax rates
Compromise likely won’t come quickly, though. The MO sports betting legislation to come closest to the finish line thus far had a tax rate of 6%. Hoskins, however, would like to see that rate much higher. Specifically, previous legislation of his sought to implement a 21% tax rate for sports betting — the same rate applied to Missouri table games and slots.
According to Leara, a 6% tax rate would only produce around $9 to 10 million more in revenue for the state of Missouri. That number falls drastically short of Hoskins’ hopes of collecting $163 million in taxes for public education and veterans programs.
The most recent Missouri sports betting legislation was stalled this September after making its way into a special session. The reasoning, Gov. Parson said, was because it was unrelated to the initial reasoning behind the session.
Fortunately, however, Parson has not expressed any overall opposition to legal sports betting in Missouri.
Differing tax rate opinions aren’t the only MO sports betting obstacle
If sports betting is to stand any chance in 2023, legislators must overcome their differences and make a compromise.
Joining forces is especially necessary in a state that features plenty of lawmakers who are inherently against gaming expansion altogether.
Leara noted the hypocrisy of what some legislators were and weren’t willing to support:
“Sports betting, likely, would expand gaming to every part of the state . . . so that’s where we see resistance, it is from legislators that do not want an expansion of gaming. The irony here is that we have some Senators that don’t want to see an expansion of gaming, but if they are going to, they’re willing to license some of the gray machines that we see in gas stations or bars, wherever those might be.”
Gray machines refer to mechanical gambling devices often operated in retail settings. Since these games are technically skill-based, they fail to qualify as slot machines and thus exist as unregulated devices. These machines have been the focal point of a number of lawsuits following their introduction in 2019. Some machine owners even donate a portion of profits to political action committees that support the proliferation of these unregulated operations.
Until legislators find a way to reconvene on common ground, MO bettors will continue flocking to neighboring states and utilizing gray machines to get their gambling fix. Meanwhile, Missouri continues to lose out on millions in supplemental tax revenue.
