Kansas to consider integrity fee in new sports betting bill

22 January 2019

Kansas lawmakers are to consider a new bill that would legalise sports betting in the state and also require an integrity fee to be paid to the operators of the leagues.

Senate Bill No.23, also known as the Kansas Wagering Act, sets out plans for the Kansas Lottery to offer sports betting in-person, via the internet and on mobile.

If passed, the bill would limit in-person sports betting to facilities operated by the Kansas Lottery, approved retailers and other gaming facilities and racetracks that have agreements in place with the lottery.

Under the proposals, the lottery would be able to set up dedicated websites and mobile apps for sports betting, as well as an interactive sports wagering platform.

The bill also sets out a provision for licensed sports betting operators to pay a ‘sports betting right’ and ‘integrity fee’ to each sports governing body with the authority over a sports event on which bets are placed. This would be payable at the end of each quarter, on July 1, October 1, January 1 and April 1.

Operators would pay an amount equal to 0.25% of the aggregate total wagered on sports events. However, the bill also sets out that this amount should not exceed 5% of the aggregate gross revenue on wagers in each quarter.

If the bill passes, Kansas would become the first state to commit to a scheme whereby operators would have to pay an integrity fee. Sports leagues have been pushing for such a measure to be included as part of new laws across the US, but states that have already legalised sports betting have opted against such a move.

Washington D.C. initially included reference to a ‘royalty fee’ in a bill, but later removed this language before progressing the bill. The state is yet to pass this bill into law.

The other language in the Kansas bill is similar to legislation that has already been passed in other states, such as a requirement for players to be located inside the state to place a sports bet.

Consumers would also need to be aged 21 or over in order to bet on sports, while all sports professionals - including athletes, coaches, referees and team owners - would be prohibited from betting in the state.

In addition, the bill sets out plans to set up a toll-free telephone number to help consumers access help and advice for gambling problems.

Sports betting has been on the agenda for some time now in Kansas and, before Christmas, lawmakers met for two days of hearings on the subject. At the time, Representative Jan Kessinger told iGamingBusiness.com that a number of bills could be filed within weeks of the meetings.

Senate Bill No.23 is some way off coming into law, with the bill now set to face the committee, full legislature and, if it should progress to that stage, the governor.

Image: Stuart Seeger