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As Missouri lawmakers consider sports gambling, revenue estimates jump

As Missouri lawmakers consider sports gambling, revenue estimates jump

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JEFFERSON CITY — Legalizing sports betting in Missouri could be more lucrative than state analysts predicted earlier this year.

In a presentation to a panel of lawmakers Thursday, a gambling industry consultant said legal sports betting could generate up to $289 million in wagers once fully operational.

Chris Krafcik, managing director for political and regulatory affairs for Eilers & Krejcik Gaming, said his estimate is based on sports betting that is taking place in other states following the lifting of a federal ban on the practice.

That amount compares to the $58 million in revenue state analysts said would be generated by a legislative proposal debated earlier this year. It also is higher than a separate proposal introduced in 2018 that put estimated revenues at $141.6 million.

Both of those estimates were made before sports betting began to spread across the country.

Missouri lawmakers have been debating for more than two years whether to join at least 18 other states and the District of Columbia in approving a law to let residents over the age of 21 bet on college and professional sports.

The talks have broken down over disagreements on how the pot of money will be divvied up by the government, casinos, sports leagues and companies that provide sports betting services.

The state lottery also wants a piece of the action.

But with states like Kansas and Illinois moving to roll out their own programs, companies seeking to cash in appeared eager for lawmakers to find a resolution when the Legislature reconvenes in January.

“We’re excited about the prospect of legalization in Missouri,” said Stacie Stern, manager of governmental affairs for FanDuel, which provides a platform for wagering on sports.

In testimony Thursday to the committee, gambling operators said one significant hurdle is a demand by sports leagues that they receive a percentage of revenues, since casinos and sports book operators like FanDuel and DraftKings are making money on their product.

Representatives of the St. Louis Cardinals and Major League Baseball, for example, said last year they wanted a 1% slice of all bets made on their games.

The league contends the money would help the league ensure the “integrity” of the game. So far, no other states have agreed to pay so-called “integrity fees” and industry officials said Missouri should not either.

Krafcik said the fee is “unsustainable,” and others told the panel it would drive up the cost of providing sports betting. If the cost of legalized sports betting is too high, that could trigger people to seek out cheaper illegal sports betting opportunities.

League officials are expected to testify at a meeting of the committee next month.

Krafcik recommended Missouri approve a sports betting system that allows wagering on college and professional games, as well as betting within those games on, for example, the number of strikeouts by a baseball pitcher or the first team to fumble the ball in a football game.

Consultants also told the committee that people should be allowed to use their cellphones to bet, as well as be able to bet at casinos that offer sports wagering.

St. Louis attorney Mark Balestra said not allowing gambling using a mobile device would mean a drastic cut in tax revenue and also would invite people to wager in the black market.

“We’re going to be missing the boat,” said Rep. Robert Ross, R-Yukon.

Under a previous plan, people would have had to first register to play at a casino and then be able to use their cellphone to cast bets.

But, Rep. Jeff Shawan, R-Poplar Bluff, said people don’t want to go register at a physical location if the option is to sign up for an illegal, offshore sports betting site on their phone.

“That’s the world we live in today,” Shawan said.

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