Legislators in Kansas have reportedly been warned that bringing legalized sports betting to ‘The Sunflower State’ may not end up being the magic pill that will help them to solve an estimated $320 budget deficit.
Revenue cannibalization warning:
According to a Sunday report from local television broadcaster, WDAF-TV, the caution came as part of a study from The Pew Charitable Trusts and included the caveat that any new revenues from sports betting are likely to have been cannibalized from other sources such as the state’s casinos.
“States could experience short-lived gains followed by downward pressure on revenues as more and more states legalize,” read a statement from one of the authors of the study, Mary Murphy.
No sports betting bonanza:
Murphy reportedly declared that it is difficult to estimate the financial benefits of legalized sports betting because the activity is not yet widespread. However, she warned Kansas against counting on a bonanza because gambling and adult products such as alcohol and tobacco currently only bring in about 3.3% of the state’s tax revenues.
“The revenue streams will likely be small,” read the statement from Murphy.
Legislation may be in the works:
Although Kansas is home to numerous commercial and aboriginal casinos, May’s ruling from the United States Supreme Court invalidating the Professional and Amateur Sports Protection Act (PASPA) federal prohibition prompted Kansas State Senate President, Susan Wagle, to begin pushing for the state-wide legalization of sports betting.
“The legalization of sportsbetting will help diminish illegal gambling operations and allow states to bring their regulations into the 21st Century,” read a May statement from the Republican legislator. “I am confident the Kansas Legislature will act appropriately to regulate sportsbetting next year.”