Kansas Betting off to mixed start, but signs broadly positive
October 20, 2022
The passage of a sports betting bill in a US state is never quite the end of the story, even allowing for the fact that such a bill will always need to be signed off by the governor. Indeed, even the first sports bets being placed don’t represent the whole story. That’s because both the advocates of legal betting and its opponents then face a wait for the first numbers to come through. Has the addition of legal sports betting caused the state’s purse to swell with new funds that are earmarked for good causes, as has become traditional with each bill that passes? This week, it was Kansas’ turn to answer that question, and the answer was: “Hmm. Not bad.”
Overall, Kansas sportsbooks saw a handle of more than $160million in sports bets in the first month of operating. That’s quite impressive for a first month. However, in terms of revenue from betting, the final total when deductions were made totalled $1.3million, with a tenth of that – $130,000 – finding its way into the state’s coffers. As first months go, that’s a shade disappointing, which may give some measure of consolation to those who opposed the legislation in the first place.
As well as having to pay out to winning customers, and taking account of operational costs, Kansas sportsbooks also gave out close to $34million in promotions to new customers. That fairly weighty amount – accounting for more than 20% of the sportsbook take – has been pointed out as the main reason for the first month’s disappointing tax take. It’s also a number that is unlikely to be repeated in following months, as the number of new customers will inevitably be lower, not to mention the fact that fewer promotions will be available as the sportsbooks settle to normal business.
The sportsbooks reflected this in their response to the early numbers, saying that in other states where betting has been legalized, this has been the pattern. Revenues rise as promotions fall, and betting continues at a healthy rate. In addition, the new NBA and NHL seasons have begun and we will soon be into the World Series, which will keep betting going at a faster rate. The soccer World Cup, kicking off in mid-November, probably won’t hurt either.
The mixed results of Kansas sports betting certainly haven’t been off-putting to Missouri lawmakers, who are set to push forward with betting legislation in the new year. They may already have seen what Kansas commissioners have seen – a total of 340,000 attempts to bet in Kansas online sportsbooks by Missouri residents, of which 57% came from Kansas City. How many of those people were convinced that the city, which is in Missouri, had legalized betting and not the state? We don’t know, but it shows that there is an appetite that crosses state lines. In the end, one of the best demonstrations of success is the existence of potential copycats.
