The final days of a legislative session often bring surprises. Still, few in Kansas were ready for what came about last week when lawmakers passed a budget that stripped the state’s lottery of its power to negotiate or extend sports betting pacts for the next two fiscal years.
On Friday, the last day of the session, the Republican-led Kansas Legislature doubled down on its position by overriding Gov. Laura Kelly’s line-item veto of that budget provision. Amid the chaos, we know that no immediate changes to Kansas sports betting are imminent. The lottery’s contracts with the four casinos that partner with the six licensed sports betting operators do not expire until Aug. 31, 2027.
While lawmakers could authorize funding in future budgets, Kelly, a Democrat, criticized the prohibition in her veto message.
“Robust processes are in place to negotiate any contract extension or renewal of existing sports wagering agreements,” she wrote. “Inserting the Legislature into these negotiations would unnecessarily complicate the complex legal processes already in place to facilitate potential changes to the State’s sports wagering agreements.”
What happens next is up is unknown at this point. A message to legislative leaders seeking comment was not returned.
Kansas Sports Betting Language A Late Addition
Budget bills are often monstrous pieces of legislation, consisting of hundreds of pages of documents dictating how billions of taxpayer dollars will be spent – or, in some cases, not spent. The House passes a budget, as does the Senate, and then leaders from both chambers begin the process of hammering out a final agreement.
The governor’s office will also produce a budget proposal. However, in a situation like Kansas, where the legislature is led by one party and the governor represents another, the governor may have little say over the final budget. Even if they veto certain items, lawmakers can override the governor’s action.
Like most states, Kansas requires a two-thirds majority from both chambers in order to override a veto. Republicans control 88 of the 125 House seats and 31 of the 40 in the Senate, giving them so-called “veto-proof” majorities in both.
Sources told BetKansas late last week that the provision to strike the lottery’s negotiating power on sports betting never came up in initial conversations about the budget. In addition, there has also been some discussion in Topeka regarding whether the state should be generating more revenue from sports betting legalization.
How Much Does Kansas Make From Sports Betting
Data from the Kansas Racing and Gaming Commission shows the state has received $14.6 million in sports betting tax revenue from April 2024 to March 2025.
Kansas does not have a license fee for sports betting operators. However, the lottery does require casino operators to pay a privilege fee. That fee is $25 million in the northeast and south-central zones and $5.5 million in the southeast and southwest regions.
Under the Kansas sports betting law, the casinos can partner with up to three sports betting operators apiece.
According to data compiled by Alfonso Straffon at iGamingAnalyst.com, Kansas sports betting operators generated approximately $224 million in gross gaming revenue over the past 12 months. That works out to $105.30 per adult in the Sunflower State, which is the 11th highest among the sports betting states that make financial information public.
However, the tax rate per adult is just $7.10, which comes in 23rd.
Something else to keep in mind. Kansas sports betting handle and revenue data have been somewhat outsized due to the lack of legal sports betting options in neighboring Missouri. That ends later this year when sports betting starts in the Show-Me State, and that may further reduce revenue for the state in the years ahead.
The bottom line is there’s nothing to worry about in Kansas for the time being. However, the odds look good for lawmakers to reconsider how Kansas generates revenue from sports betting in the years to come, and if that happens, it could change the Kansas sports betting landscape down the road.
