Missouri lawmakers had a vibrant, sometimes combative conversation about sports betting on Tuesday, and Sen. Denny Hoskins, who has been crafting sports betting legislation for at least four sessions, once again led the charge. The hearing didn’t result in a vote, but it was another step toward legalized sports betting in the state.
The hearing in the Senate Appropriations Committee went for nearly two hours, and Hoskins dominated much of that, peppering Sen. Caleb Rowden, Missouri Gaming Commission Executive Director Mike Winter, and Caesars Entertainment VP of Government Affairs A. John Baker with questions, criticisms, and observations for nearly an hour. Winter took the worst of it, fending off about 30 minutes of inquiry before Appropriations Chairman Dan Hegeman suggested Hoskins table his questions.
Missouri lawmakers have long been unable to come to a consensus on what sports betting should look like in their state. There are currently eight bills filed, including two from members of the Appropriations Committee. Most of the bill authors have some tie to either the state’s casinos or a vested interested in video lottery terminals, which in large part is driving the current division. Casino operators oppose VLTs.
Check out the spirited conversation
Throughout Tuesday’s hearing, Hoskins, who has his own bill, was clearly trying to show that Rowden’s bill has holes. The Missouri Gaming Commission came out in support of Rowden’s bill, but it is opposed to Hoskins’ bill and one proposed by Sen. Tony Luetkemeyer.
Hoskins opened his questions by announcing that he’d been “so excited” for the hearing that he’d had trouble sleeping the previous night, and by the 8:30 a.m. CT hearing start time, he had already taken a run, drank (too much?) coffee, and scribbled out five-and-a-half pages of notes. Here’s a look at some of the dialogue:
On tax rate with Sen. Rowden:
Hoskins: Your bill has a 6.75% tax rate. Do you know how that compares to other states?
Rowden: No, no, I don’t.
Hoskins: It’s the lowest anywhere. We’re leaving money on the table. Illinois is 15%, Tennessee is 20%, Arkansas is 13%, so yours is the same as Iowa. But when I look at the fiscal note … it just seems like we’re leaving money on the table.
On the tax rate and gross gaming revenue with Winter:
Hoskins: You want to support this bill, but you testified against my bill last week. So, you support a lower tax rate?
Winter: Yes, that would likely be among the lowest.
Hoskins then questions Winters about deductions from gross gaming revenue in the Rowden bill and asks:
Hoskins: Basically, you have your gross gaming revenue, and then you have all of these deductions, and THEN we’ll take what’s left? Are these kinds of additional deductions allowed for other casino games?
Winter: I’d have to get back to you.
Hoskins: I think I know the answer … you’re not currently allowed to deduct promotional play from GGR. Do you think that by allowing these deductions, we’d be limiting the amount of tax money coming in for education?
Winter: Yes, I guess.
And so it went, with Hoskins meticulously picking apart Rowden’s SB 256 and promising the same with Sen. Tony Luetkemeyer’s SB 217, two of the eight sports betting bills currently floating around Jefferson City. Hoskins’ bill, SB 98, had a much less eventful hearing in Appropriations last week. His bill and the two discussed Wednesday all call for statewide mobile wagering with the Missouri Gaming Commission as the regulator. The similarities end there. Hoskins’ bill would provide a “royalty fee” to the pro leagues — which would make Missouri a first out of about 25 jurisdictions to do so — requires the use of official league data, and has a 9% tax rate, as compared to Rowden’s 6.75% and Luetkemeyer’s 6.25%.
Other legalizations, COVID could spur action
The obvious goal in Missouri would be to get all the lawmakers and stakeholders to come to some kind of consensus, so sports betting can move forward. There have been bills in the state since 2018, when the Professional and Amateur Sports Protection Act was first overturned, and there has never been any kind of agreement.
— Turnpike Sports® (@TurnpikeSports) February 3, 2021
But just like in other states, the COVID-19 crisis and restrictions could change things in 2021. That, and the fact that states all around Missouri are legalizing, most notably Illinois, where DraftKings partnered with Casino Queen near the Missouri border. Residents in that area can now drive over the border and place a bet either in person, if they want the “casino experience,” or via mobile device.
“I think in the state of Missouri, there are a lot of concerns about illegal betting, so there is a lot of interest in protecting Missourians,” Hoskins’ chief of staff, Rachel Bauer, told Sports Handle. “Our revenue that comes in from gambling goes to education, and in a COVID world, we’re going to have to figure out some new revenue streams, and that’s exactly what this would be. This wouldn’t be moving the pots around, it’s not a shell game, but it is genuinely new revenue.
“We’re losing out, we’ve got Missourians every week driving over the border to Illinois and placing their bets. We want to be able to offer a safe and fun extension to the fan experience.”
There’s much work still to be done, and despite the sometimes bizarre tone of Tuesday’s hearing, it appears that lawmakers are willing to compromise. Rowden said during the hearing that he would “consider” changes and would be “open to conversation.” Hoskins has traditionally said the same, and to that end, a Senate committee substitution is in the works and should be available sometime next week.
Hoskins has long said that the road to sports betting in Missouri will go through his office, and the strident questioning on Tuesday was just his latest volley to control the process.
“I think it’s clear from yesterday’s hearing that Senator Hoskins is and will continue to be the leader on this issue in Missouri,” Bauer said. “And he will continue to work this through. He wants to be point man.”
Bauer expects sports betting to come up for a vote sometime later this month. The Missouri General Assembly is in session until late May.