A scrutiny of a proposed ballot question seeking to legalize sports betting in Missouri has prompted concerns about a potential flaw in the initiative, which is backed by the state’s major league sports teams.
A fiscal review conducted by Governor Mike Parson’s administration revealed that the initiative petition lacks a mechanism for state agencies to collect or deposit taxes and fees generated by a legalized sports betting program.
“Without the identification of an agency to collect the tax, no tax can be collected. Due to wording in this IP (initiative petition), the Department of Revenue assumes this IP will not generate any revenue to the state,” the analysis says, as reported by the St. Louis Post-Dispatch.
The ballot initiative’s spokesperson disputed these findings.
“Both the Missouri Constitution and our statutes give the Missouri Department of Revenue independent authority to collect all taxes imposed by law and deposit the funds, which is exactly what they will do after this November when Missourians legalize sports betting and provide tens of millions in annual, dedicated funding for Missouri education,” Jack Cardetti, spokesman for the Winning for Missouri Education, was quoted as saying in the report.
Chuck Hatfield, the author of the ballot language and a Jefferson City attorney, asserted that the chosen wording allows the administration “flexibility” in overseeing the program.
Expressing frustration with the Missouri Senate’s failure to advance a sports betting framework in recent years, six Missouri sports teams, including the St. Louis Blues, Kansas City Chiefs, St. Louis Cardinals, Kansas City Royals, St. Louis City SC, and the Kansas City Current, announced their intention last week to collect signatures for a November election ballot question.
The proposed initiative sets the sports betting tax rate at 10% and permits the teams and the state’s 13 casinos to operate both retail and online sports betting. The campaign committee is utilizing $500,000 in contributions from FanDuel and DraftKings to support the signature collection process. To qualify for the ballot, at least 8% of registered voters’ signatures in six of eight Missouri districts must be collected, totaling more than 171,000 signatures.
“The citizens of this state have been forced to play shorthanded in comparison to our surrounding neighbors when it comes to having the ability to participate in legal sports wagering, sending valuable tax dollars over our borders instead of keeping them in-state to improve the lives of Missourians,” said Chris Zimmerman, St. Louis Blues CEO and president of business operations, as per the report.
Blues have initiated the signature collection process at their home games.
While two sports betting bills have been introduced in the Senate, their prospects seem dim amid an ongoing impasse over addressing the proliferation of unregulated slot machines in gas stations and bars across the state.
The analysis, in addition to raising concerns about the Department of Revenue’s ability to handle taxes and fees, notes that the Missouri Gaming Commission lacks a mechanism to collect funds for a compulsive gambling prevention fund.
“It should be noted that the commission is not expressly authorized under this proposal to collect any of the fees described in this proposal,” the analysis, said.
Since the U.S. Supreme Court’s 2018 decision to lift federal bans on sports betting, neighboring states to Missouri have legalized it, except for Oklahoma. With significant revenue potential, sports wagering in Missouri could rival lottery and casino spending. The campaign organizers assert that legalization will curb the black market and retain residents who currently bet legally in neighboring states.
