COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:5715H.01I Bill No.:HB 2835 Subject:Entertainment, Sports and Amusements; Department of Public Safety; Gambling;
Business and Commerce; Department of Mental Health; Mental Health; Licenses
- Miscellaneous
Type:Original Date:April 29, 2024Bill Summary:This proposal establishes provisions for interactive digital games played on
mechanical amusement devices and authorizes sports wagering.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND
AFFECTED
FY 2025FY 2026FY 2027Fully
Implemented (FY
2029)
General
Revenue
Fund $2,543,177$5,079,344$6,746,874
Could exceed
$6,746,874
Total
Estimated
Net Effect
on General
Revenue$2,543,177$5,079,344$6,746,874
Could exceed
$6,746,874
Numbers within parentheses: () indicate costs or losses. L.R. No. 5715H.01I
Bill No. HB 2835
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ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND
AFFECTED
FY 2025FY 2026FY 2027Fully Implemented
(FY 2029)
State
Lottery*$0$0$0$0
Lottery
Enterprise
** $0$0$0$0
Lottery
Proceeds
Could exceed
$38,779,017
Could exceed
$79,267,547
Could exceed
$129,832,829
Could exceed
$129,832,829
Gaming
Commission
Less than
($1,132,138)
Less than
$683,433
Less than
$660,374
Less than
$160,374
Gaming
Proceeds for
Education
Less than
$6,875,674
Less than
$19,993,817
Less than
$28,048,437
Less than
$34,732,440
Highway UnknownUnknownUnknownUnknownCompulsive
Gamblers
Could exceed
$272,417
Could exceed
$221,438
Could exceed
$215,867
Could exceed
$210,205
Criminal
Records
System UnknownUnknownUnknownUnknown
Veterans
Commission
Capital
Improvement
TrustUp to $26,706Up to $51,307Up to $68,150
Could exceed
$68,150
College &
University(Unknown)(Unknown)(Unknown)(Unknown)
Total
Estimated
Net Effect
on Other
State Funds
Could exceed
$44,821,676
Could exceed
$100,217,542
Could exceed
$158,825,567
Could exceed
$165,003,998
* Income, loss and transfers-out net to $0.
** Transfer-in, transfers-out and costs net to $0. L.R. No. 5715H.01I
Bill No. HB 2835
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND
AFFECTED
FY 2025FY 2026FY 2027Fully
Implemented
(FY 2029)
Total Estimated
Net Effect on
All Federal
Funds $0$0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND
AFFECTED
FY 2025FY 2026FY 2027Fully
Implemented
(FY 2029)
Lottery
Enterprise - LOT27 FTE27 FTE27 FTE27 FTE
Lottery
Enterprise -
MHP 15 FTE15 FTE15 FTE15 FTE
Gaming
Commission15 FTE15 FTE15 FTE15 FTE
Gaming
Commission -
MHP 6 FTE6 FTE6 FTE6 FTE
Total Estimated
Net Effect on
FTE 63 FTE63 FTE63 FTE63 FTE
☒ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☒ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND
AFFECTED
FY 2025FY 2026FY 2027Fully
Implemented
(FY 2029)
Local
Government
Less than
$6,911,933
Less than
$14,517,473
Less than
$21,560,399
Could exceed
$22,303,066 L.R. No. 5715H.01I
Bill No. HB 2835
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FISCAL ANALYSIS
ASSUMPTION
§§313.427 - 313.437 – Video Lottery Control Act
Officials from the Missouri Lottery Commission (Commission/LOT) assumes the proposal
will completely eliminate its current Pull-Tab sales and reduce Keno sales by 31.3%. This
reduction may negatively impact funding for education.
The LOT
Section 313.429.1
This section of the proposal would require the Commission to implement a system of mechanical
amusement devices utilizing a licensing structure for processing license applications and issuing
licenses to manufacturers, distributors, operators, handlers, and retailers of mechanical
amusement devices, following specific requirements for eligibility.
of $37,682 each will be needed to process applications and renewals, which includes
completing background checks on owners and handlers and determining eligibility. The
cost of background checks for operators, manufacturers, distributors, retailers, handlers
and sales agents are estimated to be approximately $46,000 per year (background checks
are estimated to be $33.25 per person, and each operator, manufacturer, distributor and
retailer is assumed to have at least two owners requiring a check, with each handler
requiring one check). Cost of background checks beyond the fiscal note period will
continue at approximately $46,000 per year.
Oversight assumes it is unknown exactly how many criminal record background checks will be
performed each year. Based on information provided by the Missouri Highway Patrol, fees for
criminal history checks are deposited into the Criminal Record System Fund (0671). Background
check fees are provided below:
State and Federal Fingerprint Criminal History Fee - $22.00
State Name Criminal History Fee - $15.00
Section 313.429.3
This section of the proposal provides that the mechanical amusement devices must be connected
to a centralized system that uses industry protocols approved by the commission that allows the
commission to activate or deactivate a terminal from a remote location and capable of
monitoring and auditing plays. L.R. No. 5715H.01I
Bill No. HB 2835
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LOT assumes their department will need appropriation authority for the central system but there
is no cost associated since the cost will be reimbursed by operators/retailers in proportion to the
number of mechanical amusement devices operated.
The commission shall impose initial application fees and renewal fees. In addition to the license
fees, an annual administrative fee of $500 per device shall be paid to the Commission. It is
assumed revenues from initial application fees will total $3.9 million spread over a 4-year ramp
up period. License renewal fees are estimated at $800,000 per year beginning in year 2. Annual
device administrative fees collected by the Lottery are estimated to be $1.7 million in year one,
$3.4 million in year two, $5.1 million in year three and $6.7 million in year four and beyond.
Section 313.429.6
This section of the proposal states mechanical amusement devices shall meet independent testing
standards approved by the commission and shall be inspected and approved prior to being sold,
leased or transferred.
Section 313.429.7-8
This section of the proposal states operators must follow guidelines for plays and payouts, where
terminals can be operated (fraternal, veteran, truck stop and liquor by the drink locations and
must not be within one mile or a casino or an elementary or high school), number of devices
operated per establishment (no more than 8 devices at fraternal, veteran and truck stop locations,
no more than 5 at liquor by the drink locations), responsible gambling and refrain from
advertising. Retailers may participate in an advertising program that is promoted through and
sponsored by the Lottery.
Section 313.429.9
This section of the proposal states mechanical amusement devices must be placed in a fully
enclosed room that is continually monitored by video surveillance and where access to persons
under 21 years of age is denied by a procedure approved by the commission. Operators must post
age requirement and problem gambling helpline and provide video surveillance in the immediate
area of the mechanical amusement devices. Recorded video must be reviewed by mechanical
amusement device operators for compliance with law, rules and regulations and fines up to
$5,000 per occurrence may be assessed by the Commission for violations and for failing to
review or report violations. Upon a finding that a licensee committed a violation the commission
may impose an administrative fine not to exceed $10,000, suspend the applicable license for up
to 30 days or revoke the license for one year.
LOT assumes:
Nine (9) Lottery Security Specialists at an annual salary of $60,019 each are needed to ensure the
centralized system uses industry protocols, to activate or deactivate devices, to monitor and audit
plays, and ensure operators are following requirements for plays and payouts, where devices can
be operated, number of devices operated per establishment, advertising, posting age requirement
and the problem gambling helpline, and reviewing video surveillance and assessing fines for
noncompliance. L.R. No. 5715H.01I
Bill No. HB 2835
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Five (5) additional Lottery Security Specialists at an annual salary of $60,019 are needed to
facilitate and document VLT investigations, review cases/video surveillance and recommend
fines for noncompliance to the Commission. Mechanical amusement devices must also meet
independent testing standards approved by the Commission and must be inspected and approved
prior to being sold, leased or transferred.
One (1) responsible gaming public information coordinator is needed at an annual salary of
$53,404 to educate operators and retailers on problem gambling and manage the self –exclusion
program.
One (1) human resources specialist is needed at an annual salary of $63,065 to assist with hiring
and training FTE to administer the program.
Advertising, promotions and point-of-sales costs associated with the program are estimated to be
$1,500,000 per year.
Oversight notes provisions of 313.429.9 provide for multiple administrative fines against a
video lottery game operators or retailers that violates provisions of this subsection. These
administrative fines may not exceed $5,000 per occurrence. Oversight notes that violations
resulting in fines could vary widely from year to year. Civil penalties collected per Article IX,
Section 7 of the Missouri Constitution requires fines to be distributed to the school district where
the violation occurred; therefore, Oversight will reflect a positive fiscal impact of $0 to
Unknown to local school districts on the fiscal note.
Section 313.429.10
Provisions provide that mechanical amusement devices operators shall pay the commission 33%
of adjusted gross receipts, which, except for administrative expenses, is to be transferred to the
Lottery Proceeds Fund. The commission must compensate the municipality where a licensed
mechanical amusement device retailer maintains an establishment 4% of the 33% to cover
administrative costs. Appropriation authority will be needed to remit the 4% compensation to the
municipalities.
Section 313.429.11
The LOT notes all revenues received by the commission from license application fees, license
fees, administrative fines, and any reimbursements associated with the administration of the
provisions of sections 313.427 to 313.437, and all interest earned thereon, shall be considered
administrative expenses and shall be deposited in the general revenue fund. Moneys deposited
into the general revenue fund from such fees and fines and any reimbursements of commission
administrative expenses to administer sections 313.427 to 313.437 shall be considered
administrative expenses and shall not be considered net proceeds under Article 322 III, Section
39(b) of the Constitution of Missouri. Subject to appropriation, up to one percent of such fees
and fines shall be deposited to the credit of the veterans' commission capital improvement trust
fund created under section 42.300. The remainder of the moneys deposited in the general L.R. No. 5715H.01I
Bill No. HB 2835
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revenue fund from such fees and fines and any reimbursements of commission administrative
expenses to enforce sections 313.427 to 313.437 329 shall, subject to appropriation, be divided
as follows: (1) Fifty percent to be appropriated to public safety with an emphasis on peace
officer funding for salary increases, continuing education, training, and certifications; and (2)
Fifty percent to be used for administrative expenses associated with supervising and enforcing
the provisions of sections 313.427 to 313.437.
The commission assumes:
verify and collect Lottery’s share of adjusted gross receipts and unclaimed prizes, collect
annual license and device fees and distribute to the veterans’ commission capital
improvements trust fund, to peace officers and for other administrative expenses to
supervise and enforce the provisions of the proposal, and to remit payments to
municipalities.
to ensure the centralized system is accurately capturing data and to develop files,
applications and reports to assist in the licensing, security and accounting of the program.
LOT assumes approximately $6.1 million, $12.3 million and $18.4 million per year will be
remitted to municipalities where mechanical amusement device establishments are located in
2025, 2026 and 2027, respectively, ramping up to $24.6 million annually after year four.
The Lottery estimates 1% of license fees and fines to be deposited to the veterans’ commission
capital improvement trust fund to be $27,000 in year 1, $51,000 in year 2 and $68,000 in year 3;
and 50% of the remainder appropriated to public safety with an emphasis on peace officer
funding and 50% for administrative expenses associated with supervising and enforcing the
proposal at $1.3 million, $2.5 million, and $3.4 million, each, in years 1, 2 and 3, respectively.
Oversight will reflect the one percent of license fees transferred from the Lottery Enterprise
Fund to the Veterans’ Commission Capital Improvement Trust Fund as estimated by the LOT.
Oversight notes the provisions of 313.429.11(1) and (2) provide for 50% of the remainder of
license fees and fines be appropriated for administrative expenses associated with supervising
and enforcing the proposal and 50% of remainder of license fees and fines be appropriated to
public safety with an emphasis on peace officer funding. Oversight notes that although the
provisions of the proposal indicate the funds will be deposited into the General Revenue Fund,
Article III, Section 39(b)2 of the Missouri Constitution states, “The money received by the
Missouri State lottery commission from the sale of Missouri lottery tickets, and from all other
sources, shall be deposited in the “State Lottery Fund...” (empour hasis added). Therefore, for
fiscal note purposes Oversight will reflect the revenue generated from these provisions being
deposited into the State Lottery Fund and then transferred to General Revenue for appropriation
for supervising and enforcing the proposal and to Public Safety as noted above. L.R. No. 5715H.01I
Bill No. HB 2835
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Section 313.429.12, .13, and .14
LOT assumes the commission shall contract with a state law enforcement entity to assist in
conducting background investigations and for enforcement. For .13, the LOT assumes device
licensees suspected of violations shall be afforded an administrative hearing by the commission
director and .14 the commission shall adopt rules for implementing mechanical amusement
devices.
$500,000 per year is the estimated cost to contract with state law enforcement. One paralegal
FTE at an annual salary of $58,873 and one associate hearings/appeals referee at an annual salary
of $60,639 are assumed to assist with additional legal work involved with promulgating rules
and handling administrative hearings.
Section 313.431
The LOT assumes the commission shall (1) contract for a centralized communication system
within 120 days after the effective date; (2) make license applications/forms available for
manufacturers, distributors, operators, retailers and handlers and promulgate rules within 120
days after the effective date; (4) establish a start date for when operators may begin soliciting
retailers no more than 60 days after applications are available; (5) approve or deny any retailer
applications no more than 90 days after such application has been received.
The Lottery assumes 2,500 retailers will operate 13,475 devices after a 4-year ramp up period.
Additional proceeds to the Lottery and municipalities from mechanical amusement device sales
are anticipated to be $50.7 million in year one and grow to $152.2 million in year three, offset by
lost profits from Keno and Pull-Tabs of approximately $14.3 million per year. Keno sales are
expected to be cannibalized by 31.3% and Pull-Tab sales are anticipated to be completely
eliminated.
It is estimated an additional 4,000 square feet of office space is needed in the St. Louis region at
a cost of $21 per square foot, $2 per square foot for utilities, and $1.50 per square foot for
janitorial
Net effect of the above impacts on the Lottery Proceeds Fund is anticipated to be a positive $36.3
million in FY 2025, positive $70.1 million in FY 2026 and positive $114.5 million in FY 2027.
Oversight will determine the fiscal impact to the Lottery Proceeds Fund and other funds based
on information provided by the LOT.
Officials from the Department of Public Safety - Missouri Highway Patrol (MHP) state the
Video Lottery Terminal portion of the bill gives statutory authority for the Lottery Commission
to contract with a state law enforcement agency. Section 313.429.12 states “The commission
shall contract with a state law enforcement entity to assist in conducting investigations into
applicants for any video lottery game license and to investigate violations by any video lottery
game licensee of any of the provisions of sections 313.427 to 313.437 or state law regulating L.R. No. 5715H.01I
Bill No. HB 2835
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illegal gambling activities..."
If the Lottery Commission elects to contract with the Patrol, this bill would create hundreds of
additional locations throughout the state that would require regulatory compliance checks.
It is assumed that expenses incurred by the Patrol will be reimbursed by the Lottery Commission.
However, the minimum resources required by the MHP are estimated to be fifteen (15)
additional FTE to perform background investigations on vendors/operators, criminal
investigations, and regulatory enforcement throughout the state. This consists of two (2)
members to perform background investigations, (12) twelve members to oversee regulatory and
criminal investigations in the field, and one (1) clerk/typist to process related reports. The 12
field investigators include one member per troop in six of the troops, and two members in Troops
A, C, and D.
If the Patrol continues to be the investigative agency that has been tasked with investigating the
majority of illegal gambling complaints, a reasonable assumption can be made that the number
of illegal devices and complaints can potentially increase resulting in a greater backlog of
complaints, and a greater expectation placed on the enforcement of the establishments allowing
the operation of illegal devices.
The number of fingerprint or name only criminal record checks performed based on the
regulatory criteria for the video lottery section of this proposed legislation is unknown.
Fees for the name or fingerprint based criminal history check and how much is deposited into the
Criminal Record System Fund for each check performed is provided below:
State and Federal Fingerprint Criminal History Fee - $22.00 to the Criminal Record System Fund
(0671);
State Name Criminal History Fee - $15.00 to the Criminal Record System Fund (0671)
Oversight does not have any information to the contrary. Therefore, Oversight will show the
FTE as assumed by the MHP. Oversight will reflect the cost 15 FTE to the Lottery Enterprise
Fund.
Section 313.429.13
The LOT
video lottery license holder and refer violations to law enforcement and suspend or revoke the
license of any lottery vendor or licensee that allows the use of any machine or device not
authorized.
Section 313.429.14
The LOT
implementing video lottery. L.R. No. 5715H.01I
Bill No. HB 2835
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The Commission estimates $500,000 per year as the cost to contract with state law enforcement.
One (1) paralegal FTE at an annual salary of $58,873 and one (1) associate hearings/appeals
referee at an annual salary of $60,639 are assumed to assist with additional legal work involved
with promulgating rules and handling administrative hearings.
Section 313.431.1
The LOT states the commission shall issue a request for proposal for a centralized
communication system, make license applications available for manufacturers, distributors,
operators, retailers and handlers, and promulgate rules within 120 days of the effective date.
In summary, the Missouri Lottery Commission assumes this proposal will require 27 new FTE,
fringe benefits and equipment and supplies (including additional rental space in the St. Louis
area) at a cost of $4,688,903 in FY 2025, $4,808,503in FY 2026 and $4,908,648 in FY 2027 to
implement the changes in this proposal.
Oversight does not have any information to the contrary. Therefore, Oversight will reflect the
FTE cost and the estimated revenue as reflected by the Missouri Lottery Commission.
LOT estimates a loss of revenue of $3,569,191 in FY 2025, $14,276,763 in FY 2026 and
$14,276,763 in FY 2027 as a result potential elimination of current Pull-Tab programs at
fraternal organizations and reduction in Keno sales.
Oversight will reflect the potential loss to the State Lottery Fund as estimated by the LOT.
Oversight currently does not have the data or resources available to produce independent
revenue projections to estimate the elasticity of demand for video lottery wagering in relation to
other games of chance offered by the Missouri Lottery or at casinos. Therefore, for purposes of
this fiscal note, Oversight will utilize the estimates provided by the Missouri Lottery
Commission.
Oversight provides the following table to summarize the Lottery Commissions revenues from
this section (Section 313.429.10). L.R. No. 5715H.01I
Bill No. HB 2835
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State Revenue ImpactProvisionFY25FY26FY27Initial Application Fee$985,950$985,950$985,950Annual Renewal and
Terminal Admin Fees$1,684,375$4,144,700$5,829,075
VLT Proceeds (29%
of 33% AGR Tax)$50,750,742$101,441,485$152,162,226
Total State Impact$53,421,067$106,572,135$158,977,251
Local Revenue Impact
Dock Cities/Counties
(4% of 33% AGR
Tax) $6,147,969$12,295,938$18,443,906
Oversight will reflect 33% of gross receipts from video lottery terminals as income to the State
Lottery Fund and then will show a transfer to the Lottery Proceeds Fund to be appropriated to
public elementary and secondary education with an emphasis on funding elementary and
secondary education student, teacher, and community health and safety. Combined revenue to
the Lottery Proceeds Fund, after expenses, will total $38,779,017 in FY 2025, $79,267,547 in FY
2026 and $129,832,829 in FY 2027.
Oversight will also show 4% of gross receipts from video lottery terminals as income to the
State Lottery Fund, then show a transfer to the Lottery Enterprise Fund where the income will be
transferred once again to municipalities or counties where a licensed video lottery game retailer
maintains an established license for the operation of video lottery game terminals.
Officials from the Department of Revenue (DOR) state this proposal establishes the framework
for having Mechanical Amusement Devices in Missouri. The entire program is handled by the
Missouri Lottery, including the collection of all fees. The DOR deters to the Missouri Lottery for
impact.
Officials from the Missouri Gaming Commission (MGC) state §§313.427 through 313.437
discuss video lotter terminals as regulated by the Missouri Lottery Commission. These sections
do not impact the MGC. L.R. No. 5715H.01I
Bill No. HB 2835
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§§313.800 - 313.1022 - Sports Wagering
Officials from the Missouri Gaming Commission (MGC) assume the following:
Section 313.800
MGC states this section redefines “adjusted gross receipts” to not include adjusted gross receipts
from sports wagering as defined in Section 313.1000, RSMo. It also removes the exclusion of
gambling on sporting events from the definition of “gambling game” and adds sports wagering to
the definition of “games of skill.”
Section 313.813
MCG assumes this section permits the Missouri Gaming Commission to promulgate rules
allowing a person to voluntarily exclude themselves from a licensed facility or platform
regulated under Sections 313.1000 to 313.1022, RSMo. It is also assumed this section requires a
person that has self-excluded and has placed a wager under Section 313.1000 to 313.1022,
RSMo, to forfeit his or her winnings, which shall be deposited to the Compulsive Gamblers
Fund.
Oversight will present Unknown income to the Compulsive Gamblers Fund for winnings
forfeited by persons who placed themselves on the voluntary exclusion list. It is unknown
whether these forfeited amounts will be over or under $250,000 per year.
Section 313.842
MGC states this section requires programs that provide treatment, prevention, recovery, and
education services for compulsive gambling to be established. This section directs funding for
the programs from the one cent admission fee authorized pursuant to section 313.820, taxes
collected and distributed to any city or county under section 313.822, and other funds as may be
appropriated by the general assembly.
This section establishes a “Compulsive Gamblers Fund” within the Department of Mental Health
(DMH). The DMH is directed to administer programs for compulsive gamblers. The MGC is
directed to administer programs to educate the public about compulsive gambling, promote
treatment programs and administer a voluntary exclusion program. It requires the Missouri
Gaming Commission, in cooperation with the Missouri Department of Mental Health, to develop
a triennial report to assess the social and economic effects of gaming in the state to obtain
scientific information related to compulsive gambling. Provisions relating to what the report is to
consist of are outlined in the legislation. The first report shall be submitted to the Governor, the
President Pro Tempore of the Senate and the Speaker of the House of Representatives no later
than December 31, 2025, and not later than December 31 of every third year thereafter.
MGC anticipates needing to contract with a third party to prepare the report due to the Gaming
Commission lacking personnel with the necessary expertise to generate such a report. The
Gaming Commission anticipates that the cost of each report will be $500,000. This legislation L.R. No. 5715H.01I
Bill No. HB 2835
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does not specify whether the cost of the report should be paid from the Gaming Commission
Fund or the Compulsive Gamblers Fund.
Oversight will present the cost of this report to the Gaming Commission Fund. In addition,
Oversight will present the cost of an additional report in FY29 as a report would be due to
Governor, House and Senate leadership by December 31, 2028.
Section 313.1000
MGC states this section of the proposal defines terms used in Sections 313.1000 to 313.1022,
RSMO, including: “adjusted gross receipts”, “certificate holder,” “certificate of authority,”
“commercially reasonable terms,” “commission,” “covered persons,” “department,” “designated
sports district”, “designated sports district mobile licensee”, “esports”, “excursion gambling
boat,” “gross receipts,” “interactive sports wagering platform”, “interactive sports wagering
platform operator,” “licensed applicant,” “licensed facility,” “licensed supplier,” “occupational
license,” “official league data,” “person,” “personal biometric data,” “professional sports team
entity”, “prohibited conduct,” “sports governing body”, “sports wagering or sports wager (adds
esports and includes types of bets),” “sports wagering commercial activity,” “sports wagering
device or sports wagering kiosk,” “sports wagering operator or operator,” “sports wagering
supplier”, “supplier’s license,” “tier 1 bet” and “tier 2 bet”.
Section 313.1002
MGC states this section exempts the State of Missouri from the provisions of 15 U.S.C. Section
1172, and legalizes all shipments of gaming devices, including devices capable of accepting
sports wagers, into Missouri, and excludes point-of-contact devices or kiosks from being
considered gambling devices.
Section 313.1003
This section states that only a certificate holder may offer sports wagering in Missouri and that
such a certificate holder may offer sports wagering on a licensed excursion gambling boat or
over the internet via an interactive sports wagering platform to persons physically located in
Missouri. This provision prohibits sports wagering commercial activity within a designated
sports district without the approval of the applicable professional sports team entity, excluding
offering sports wagering over the internet via an interactive sports wagering platform accessible
to people physically located within the designated sports district.
Section 313.1004
The provisions of this section grants the Missouri Gaming Commission the power to regulate
sports wagering and to adopt any necessary rules. In addition, this section requires the MGC to
establish a hotline for people to confidentially report prohibited conduct and requires the MGC to
investigate all reasonable allegations of misconduct and refer any deemed credible allegations to
appropriate law enforcement. L.R. No. 5715H.01I
Bill No. HB 2835
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April 29, 2024
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Section 313.1006
MGC states this section requires a licensed applicant holding a license under Section 313.807 to
operate an excursion gambling boat who wishes to offer sports wagering to submit an application
(on forms proscribed by the Gaming Commission) to the Gaming Commission, pay an initial
application fee of up to $100,000 (deposited into the gaming commission fund) and submit a
responsible gambling plan that will include specified provisions. Upon receipt of the application
and fee, requires the Gaming Commission to issue a certificate of authority to the applicant to
conduct sports wagering.
Oversight will reflect revenue generated from this fee in the Gaming Commission Fund.
Section 313.1008
MGC assumes .2 of this section permits a licensed facility that is an excursion gambling boat to
offer sports wagering through up to three (3) individually branded interactive sports wagering
platforms. It addition, this subsection permits a sports wagering operator to operate the
interactive sports wagering platforms or to contract with a platform operator to do so. The total
number of platforms utilized by any one owner of a licensed facility is limited to 6.
.3 of this section permits each designated sports district mobile licensee to offer sports wagering
through one interactive sports wagering platform, but the licensee must be licensed by the
Gaming Commission as an interactive sports wagering platform operator.
MGC assumes the Sports District Mobile Licensee application fee of $150,000. (Sports District
Mobile Licensee will be licensed as an Interactive Sports Wagering Platform Operator, which is
required to pay $150,000 application fee under Section 313.1010, RSMo. MGC assumes this fee
will be deposited into the Gaming Commission Fund.
Oversight will reflect revenue generated from this fee in the Gaming Commission Fund.
.4 requires that any in-person or kiosk sports wagering only be conducted in a licensed facility
that is an excursion gambling boat.
.5 permits sports wagering to be conducted with chips, tokens, electronic cards, cash, cash
equivalents, debit or credit cards, other negotiable currency, online payment services, automated
clearing houses, promotional funds or other approved means. This subsection also requires a
sports wagering operator to determine a minimum wager amount and permits it to determine a
maximum wager amount.
.7 requires a sports wagering device, point of contact sports wagering device or sports wagering
kiosk to be approved by the gaming commission and acquired from a license supplier.
.8 requires the MGC to determine what occupations related to sports wagering require an
occupational license, excluding employees that do not possess the authority or ability to alter
material systems required for sports wagering. L.R. No. 5715H.01I
Bill No. HB 2835
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.9 permits a sports wagering operator to lay off one or more sports wagers. Permits the MGC to
promulgate rules permitting sports wagering operators or platforms to employ systems that offset
loss or manage risk through the use of liquidity pools in other jurisdictions in which the operator
or platform also holds a license to conduct sports wagering.
.10 requires a sports wagering operator to provide information and tools to assist players in
making responsible decisions with required provisions provided.
Section 313.1010
MGC assumes this section requires an interactive sports wagering platform operator that offers
sports wagering on behalf of a licensed facility to be licensed and have a contract with the
licensed facility. It is also assumed the provisions require a prospective interactive sports
wagering platform operator to submit an application to the Gaming Commission, pay an initial
application fee of up to $150,000 and submit a responsible gambling plan. The provisions also
require a licensed interactive sports wagering platform operator to pay an annual renewal fee of
up to $325,000, which is to be deposited into the gaming commission fund and makes an
application relating to sports wagering and all related submitted materials confidential.
Oversight will reflect revenue generated from these fees to the Gaming Commission Fund.
Section 313.1011
MGC assumes this provision permits the Gaming Commission to issue a supplier’s license to a
sports wagering supplier, permits a licensed sports wagering supplier to provide its services
under a fixed-fee or a revenue sharing agreement, and permits the Gaming Commission to, at the
request of a sports wagering supplier license applicant, issue a provisional license to the
applicant as long as the applicant has submitted a complete application and has paid the required
application fee and to promulgate any necessary rules to do so.
The provisions require a sports wagering supplier license applicant to disclose the identity of: 1)
the applicant’s principal owners who directly own 10% or more of the applicant; 2) each holding,
intermediary, or parent company that directly owns fifteen percent or more of the applicant; and
3) the applicant’s CEO and CFO, or their equivalents. In addition, the provisions waive having
to disclose government-created entities and investment funds or entities registered with the
Securities and Exchange Commission that are direct or indirect shareholders of the applicant.
Requires a licensed sports wagering supplier to pay a renewal fee as determined by the Gaming
Commission biennially (every other year).
Oversight contacted MGC officials and determined there are no licensed sports wagering
“suppliers”. Therefore, there will be no fees collected for this provision of the proposal. L.R. No. 5715H.01I
Bill No. HB 2835
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Section 313.1012
MGC notes the provisions of this section require a sports wagering operator to verify that a
person placing a wager is of the legal age limit (21 years old), requires the Gaming Commission
to establish an online method for a player to apply for placement in the self-exclusion program
and requires the sports wagering operator to include a link to the self-exclusion application on all
sports wagering platforms.
The provisions require the Gaming Commission to adopt rules to ensure that advertisement for
sports wagering: 1) do not knowingly target minors or other ineligible persons, problem
gamblers or other vulnerable people; 2) disclose the sports wagering operator’s identity; 3)
provide information about and links to gambling addition resources; 4) are not false, misleading
or deceptive; 5) are not included on internet sites or pages dedicated to compulsive or problem
gambling; and 6) include responsible gambling messages and nationally recognized problem
gambling helpline number in all promotional activities.
The Gaming Commission is required to establish penalties for advertisement violations of not
less than $10,000 but not more than $100,000.
Oversight notes that violations of section 313.1012 could result in fines or penalties. Oversight
also notes per Article IX Section 7 of the Missouri Constitution fines and penalties collected by
counties are distributed to school districts. Fine varies widely from year to year and are
distributed to the school district where the violation occurred. Oversight will reflect a positive
fiscal impact of $0 to Unknown to local school districts. For simplicity, Oversight will not reflect
the possibility that fine revenue paid to school districts may act as a subtraction in the foundation
formula.
Section 313.1014
MGC assumes the Gaming Commission is required to conduct a background check that includes
a search for criminal history and any charges or convictions involving corruption or
manipulation of sporting events. The background investigation is required to be consistent with
the provisions of Section 313.810, RSMo.
Among other requirements, the provisions of this section require a sports wagering operator to
adopt procedures to obtain personally identifiable information from any individual that makes a
single wager while physically present in casino of $10,000 or more, requires the Gaming
Commission and sports wagering operators to cooperate with investigations conducted by law
enforcement or sports governing bodies, requires a sports wagering operator to immediately
report to the MGC criminal or disciplinary proceedings, illegal bets, abnormal wagering
activing, any other conduct that corrupts the wagering outcome of a sporting event and
suspicious or illegal wagering activities. Sports wagering operators are prohibited from offering
wagers at an elementary or secondary school athletic or sporting event. L.R. No. 5715H.01I
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Oversight assumes background check fee costs are included in the application fees paid by
licensees to MGC. Based on discussions with MGC and MHP officials, it is assumed the number
of background checks will not have a significant impact on the either agency.
Per MHP’s website, fingerprint-based background checks currently cost $41.75 per applicant.
The fee consists of:
State $22.00 ($20 state fee + $2 pass through fee from the FBI)
Vendor fee $ 8.50
Federal $11.25 ($13.25 - $2 pass through fee paid to the State)
$41.75
Therefore, $22 of every fingerprint-based background check is deposited into the Criminal
Records System Fund (0671). Since the amount of fees paid to the Criminal Records System
Fund by MGC is not expected to be significant, Oversight assumes minimal fiscal impact and
will not include these fees for fiscal note purposes.
Section 313.1016
MGC assumes a sports wagering operator is required to maintain certain specified records
relating to a sports wager over $10,000 made in person as well as maintaining records related to
all sports wagers made via an interactive sports wagering platform. A sports operator is required
to make maintained records and information available at the request of the Gaming Commission.
Section 313.1018
MGC assumes this section removes liability from a sports wagering operator for disclosing
information required under Sections 313.1000 – 313.1022, RSMo, or for refusing to disclose
information not required to be disclosed by Sections 313.100 – 313.1022, RSMo.
Section 313.1021
MGC assumes the following for this section:
.1 - Imposes a 10% wagering tax on a sports wagering operator’s adjusted gross receipts received
from sports wagering. If an interactive sports wagering platform operator is contracted to
conduct sports wagering either at a licensed facility (that is an excursion gambling boat) or
through an interactive sports wagering platform, then it may pay the imposed 10% tax.
.2 - Requires the imposed 10% tax to be paid no later than one day prior to the last business day
of the month following the month in which the taxes were generated. If a month where the
sports wagering operator’s adjusted gross receipts was negative, the operator is permitted to
carry over the negative amount for a period of 12 months.
.3 - Requires the imposed tax be paid to the Department of Revenue by an electronic funds
transfer by an automated clearing house. L.R. No. 5715H.01I
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.4 - Requires that the received tax be deposited into the State Treasury to the credit of “Gaming
Proceeds for Education Fund,” to be distributed as provided under Section 313.822.
.5 - Imposes an annual renewal fee of up to $50,000 to be paid by a licensed facility that is an
excursion gambling boat, which is to be paid on the anniversary date of issuance of the license
and on each anniversary date thereafter. The received fees are required to be paid into the
gaming commission fund. Requires a certificate holder to also pay a $10,000 reinvestigation fee
every 4 years, which such fee is required to be paid into the gaming commission fund.
.6 – Subject to appropriation, requires $500,000 be appropriated from the gaming commission
fund and credited annually to the compulsive gamblers fund. The General Assembly, when
considering the amount of funds to appropriate to the compulsive gamblers fund, shall consider
the findings and recommendations contained in the research report required by Section
313.842.2, RSMo, for increased funding in excess of the $500,000.
Section 313.1022
MGC assumes that sports wagers will be deemed initiated, received, and otherwise made on the
property of an excursion gambling boat. The provisions require, to the extent required by federal
law, that servers necessary for the placement and resolution of sports wagers be physically
located within a licensed facility that is an excursion gambling boat. In addition, the provisions
state that the intermediate routing of electronic data relating to sports wagers shall not determine
the location or locations in which sports wagers are initiated, received, or otherwise made.
MGC Fiscal Impact
MGC states sections 313.427 to 313.437 of this bill propose a new form of entertainment, which
would be regulated by the Missouri Lottery Commission. It is assumed that video lottery
terminals (VLTs) would be in direct competition with bingo and excursion gambling boats,
resulting in a reduction in state gaming taxes to education. The extent that these reductions will
be offset by new revenue generated by VLTs is unknown. This Act would also result in a
reduction of state admission fees which benefits Veterans, National Guard and Access Missouri
education programs, as well as reductions in casino taxes and admission fees paid to local
governments in home dock cities. Although the extent of the reduction in revenue in both state
and local taxes from riverboat gaming casinos and charitable bingo is unknown, it is believed to
be significant, as has been the case in other states which have video lottery terminals, such as
Illinois.
Oversight assumes the implementation of video lottery in Missouri may have a negative impact
on the utilization of Missouri’s casinos (patrons may choose to play video lottery instead of
visiting a Missouri casino). Therefore, Oversight will reflect an unknown loss to the Gaming
Commission Fund (0286), the Gaming Proceeds for Education Fund (0285) and to Local
governments for funds directed away from bingo and excursion gambling boats to video lottery
terminals. Oversight assumes losses to each of these funds will exceed $250,000 annually. L.R. No. 5715H.01I
Bill No. HB 2835
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MGC states for sections 313.1000 to 313.1022, RSMo, which authorizes retail (in-person) and
online sports wagering, the Missouri Gaming Commission estimates a total of 21 applicants for
sports wagering licenses, to include the 13 current excursion gambling boats, 8 sportsbook
providers that would offer the interactive platforms for sports wagering and 3 sports district
mobile licensees. Based on the aforementioned assumption, the Missouri Gaming Commission
estimates collecting the following fee amounts to be paid into the Gaming Commission Fund:
$2,950,000 for the first year (FY25), $4,225,000 for the second year (FY26), $4,225,000 for the
third year (FY27), $4,355,000 for the fourth year (FY28) and $4,225,000 for the fifth year
(FY29). These estimates are based on the belief that all excursion gambling boats (13) will apply
for a Certificate of Authority, there are 8 sports wagering operators that will seek a Sports
Wagering Platform License, and that 3 Sports District Mobile applications will see licenses.
These numbers are subject to adjustment depending on the number of Sports Wagering Platform
Licenses and Sports District Mobil Licenses are issued.
In calculating tax revenue estimates, the Missouri Gaming Commission used the sports wagering
data from a comparable state, specifically Indiana, due it having similar population, number of
casinos, geographical proximity and other demographics as Missouri.
Indiana’s total adjusted receipts from sports wagering, which includes both retail (in-person) and
online, was:
FY 2020 - $84,969,839
FY 2021- $240,503,973
FY 2022 - $328,639,984
FY2023 - $312,856,595
Assuming that the total adjusted gross receipts for sports wagering in Missouri will be
comparable to that of Indiana, the Gaming Commission estimates that total adjusted gross
receipts for sports wagering in Missouri will be:
FY 2025 - $76,396,382
FY 2026 - $222,153,520
FY 2027- $311,649,297
FY 2028 - $346,911,217
FY2029 - $385,915,998
In determining the aforementioned estimates, a 0.25% deduction for excise tax and a 9.84%
deduction for promotional wagering were made to Indiana’s total adjusted gross receipts from
sports wagering due to the bill’s (HB 2331) definition of adjusted gross receipts including such
deductions for the first year of sports wagering, whereas Indiana’s definition does not.
Additionally, the 9.84% deduction for promotional wagering has been adjusted so that the
deduction is decreased by 25% each year as required by the new Section 313.1000.1(1)(a)d,
RSMo. In other words, there is a 100% (9.84%) deduction of promotional wagering for the first L.R. No. 5715H.01I
Bill No. HB 2835
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April 29, 2024
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year, a 75% (7.38%) deduction for the second year, a 50% (4.92%) for the third year, a 25%
(2.46%) for the third year, and no deduction (0%) for the fifth year and any subsequent years.
Furthermore, the bill’s (HB 2835) definition of adjusted gross receipts includes deducting voided
or cancelled wagers and uncollectible receivables, but such deduction was not made in
determining the aforementioned tax revenue estimates because Indiana’s adjusted gross receipts
already include a 2% deduction for such, which the Missouri Gaming Commission estimates will
be a similar amount in Missouri.
Thus, using the total adjusted gross receipts for sports wagering in Missouri estimates, the
Missouri Gaming Commission estimates that the revenue from the Gaming Tax (10% of
Adjusted Gross Receipts) on sports wagering will be $7,639,638 for the first year (FY25)
($6,875,674 to the State of Missouri and $763,964 to the Home Dock Cities or Counties),
$22,215,352 for the second year (FY26) ($19,993,817 to the State of Missouri and $2,221,535 to
the Home Dock Cities or Counties), $31,164,930 for the third year (FY27) ($28,048,437 to the
State of Missouri and $3,116,493 to the Home Dock Cities or Counties), $34,691,122 for the
fourth year (FY28) ($31,222,010 to the State of Missouri and $3,469,112 to the Home Dock
Cities and Counties) and $38,591,600 for the fifth year (FY29) ($34,732,440 to the State of
Missouri and $3,859,160 to the Home Dock Cities and Counties).
Oversight will reflect revenue generated from the 10% wagering tax into the Gaming Proceeds
for Education Fund. (A summarized table has been provided below). Oversight will also reflect
revenue generated from the renewal fee and the reinvestigation fee into the Gaming Commission
Fund and a transfer from the Gaming Commission Fund into the Compulsive Gamblers Fund of
$500,000.
The MGC
cost to the MGC of $1,818,861 (including salary, fringe, supplies, equipment, and travel/lodging
related to job performance of those additional employees), in addition to approximately
$2,182,431, which represents 7.7% of the MGC existing budget each year (to cover the costs of
MGC and MSHP Gaming Division staff plus expenses needed to license and regulate sports
wagering) for a total initial cost of $4,001,292. Additional costs included in this estimate may
also encompass those associated with the development and implementation of responsible
gambling programs. The total annual ongoing personnel cost, after the first year, is estimated to
be $3,943,017. Based on the application, renewal and annual administrative fees for the
certificate holders and the interactive sports wagering platform providers, the total amount of
fees collected will be insufficient to cover the Missouri Gaming Commission’s costs to license
and regulate sports wagering.
Oversight notes the MGC estimates that approximately 7.7% MGC’s current budget (employee
time, E&E, and other resources) will be used for sports wagering activities in addition to the new
FTE requested. Oversight assumes this is a “reallocation” of current costs/expenses between
“divisions” within MGC and, therefore, will not present the estimated $2,182,431 as additional
(new) costs against Gaming Commission’s proceeds for fiscal note purposes. L.R. No. 5715H.01I
Bill No. HB 2835
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*90%/10% of AGR - FY25 AGR= $76,396,382, FY26 AGR = $222,153,520, FY27 AGR = $311,649,297, FY28 AGR = $346,911,217;
FY29 AGR=$385,915,998
State Impact - Estimated by MGCProvisionFee AmountFY25FY26FY27FY28FY29Fund to Deposit
§313.1006(2)
Certificate of Authority
Application Fee (Initially) -
Casino
13$100,000$1,300,000$0$0$0$0
Gaming Commission
Fund
§313.1008.3
Sports District Mobile
Licensee Application Fee
3$150,000$450,000$0$0$0$0
Gaming Commission
Fund
§313.1010.2(2)
Sports Wagering Platform
License Application Fee
(Initially)-Sportsbook
Provider
8$150,000$1,200,000$0$0$0$0
Gaming Commission
Fund
§313.1010.3
Sports Wagering Platform
License Annual Renewal
Fee-Sportsbook provider
8$325,000$0$2,600,000$2,600,000$2,600,000$2,600,000
Gaming Commission
Fund
§313.1010.3
Sports District Mobile
Licensee Annual Renewal
Fee
3$325,000$0$975,000$975,000$975,000$975,000
Gaming Commission
Fund
§313.1021.1.5.(1)
Certificate Holder
Administration Fee
(Annual after the first year)
13$50,000$0$650,000$650,000$650,000$650,000
Gaming Commission
Fund
§313.1021.5.(2)
Certificate Holder
Reinvestigation Fee (in the
4th year after sports
wagering commenced and
each 4th year thereafter)-
Casino-
13$10,000$0$0$0$130,000$0
Gaming Commission
Fund
Total Fees Collected$2,950,000$4,225,000$4,225,000$4,355,000$4,225,000Gaming Commission Wagering Tax (90%)* (§313.1021.1)$6,875,674$19,993,817$28,048,437 $31,222,010 $34,732,440Gaming for Education Total State Impact$9,825,674$24,218,817$32,273,437$31,226,365$38,957,440 Local Impact - Estimated by MGC
Wagering Tax (10%)* (§313.1021.1)$763,964$2,221,535$3,116,493$3,469,112$3,859,160Dock Cities/Counties L.R. No. 5715H.01I
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Officials from the Department of Revenue (DOR) assume the following:
Section 313.1021 requires a wagering tax of ten percent (10%) to be imposed on the adjusted
gross receipts received from sports wagering conducted by a certificate holder under Sections
313.1000 to 313.1022. If a third party is contracted with to conduct sports wagering at a
certificate holders’ licensed facility, the third party contractor shall fulfill the certificate holder’s
duties under this section.
The certificate holder is required to remit the tax imposed to DOR by the close of business no
later than one day prior to the last day of the month following the month in which the taxes are
generated. Currently, the excursion gaming boats send daily deposits to DOR. The Department
notes if a third party is involved, the DOR would need to be notified so it would know who is
responsible for the payment. These provisions are not expected to fiscally impact the
Department.
This proposed section states that the revenues received from the tax imposed under subsection 1
of this section shall be deposited in the state treasury to the credit of the Gaming Proceeds for
Education Fund, and shall be distributed as provided under Section 313.822. DOR notes this
would require the DOR to distribute the funds with 10% to the home dock city and the other 90%
to the gaming proceeds for education fund. Since DOR currently receives its funding this way
and uses this distribution system, DOR believes this would not have any additional fiscal impact.
This proposed section states that a certificate holder shall pay to the commission an annual
administrative/license renewal fee of up to fifty thousand dollars ($50,000). The fee imposed
shall be due one year after the date on which the certificate holder commences sporting wagering
operations under Sections 313.1000 to 313.1022, and on each annual anniversary date thereafter.
The commission shall deposit the administrative fees received under this subsection in the
gaming commission fund.
In addition to the annual administrative fee required under this subsection, a certificate holder
shall pay to the commission a fee of ten thousand dollars ($10,000) to cover the costs of a full
reinvestigation of a certificate holder in the fourth year after the date on which the certificate
holder commences sports wagering operations under Sections 313.1000 to 313.1022 and on each
fourth year thereafter. The commission shall deposit the fees received under this subdivision in
the gaming commission fund.
The DOR defers to the Gaming Commission for determining the amount of
administrative/license fees that may be collected.
Methodology used by DOR
Using the Oxford Economics report titled “Economic Impact of Legalized Sports Betting,” the
Department believes TSR will increase an estimated $20.2– $25.3 million. This report breaks
out the possible revenue impacts into three categories. They are Limited Availability, Moderate L.R. No. 5715H.01I
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Availability, and Convenient Availability. For the purpose of this fiscal note response, the
Department utilized the Moderate Availability, due to the proposed legislation allowing sports
wagering to occur in any of Missouri’s casinos, and online. If online would have not been
permitted, the Department would have used the Limited Availability number, and if it were to be
treated like the lottery, Convenient Availability would have been used.
$202,200,000-$253,300,000 (Moderate Availability AGR Estimate per Oxford report)
$20,220,000-$25,330,000 (10% tax imposed on AGR)
Breakout of the 10% per Section 313.822 RSMo (when fully implemented).
10% to Dock Cities (Local) – $2,022,000-$2,533,000 (10% of 10% tax on Moderate Availability
AGR Estimate)
90% to Gaming Proceeds for Education Fund- $18,198,000-$22,797,000 (90% of 10% tax on
Moderate Availability AGR Estimate)
Administrative Impact
DOR assumes this legislation will result in an increase in the number of payments received. If
the increase is significant, the Department will require 1 Associate Customer Service
Representative FTE.
Oversight assumes DOR is provided with core funding to handle a certain amount of activity
each year. Oversight assumes DOR could absorb the cost related to an increase in payments
received. (MGC estimates 13 certificates of authority (current number of gambling boats) and
eight wagering platforms (sportsbook providers). If each entity reports monthly there would be
252 additional returns each year.) If multiple bills pass which require additional staffing and
duties at substantial costs, DOR could request funding through the appropriation process.
DOR also anticipates ITSD will need to create a new sports betting tax collection database.
Oversight notes ITSD assumes that every new IT project/system will be bid out because all their
resources are at full capacity. For this bill, ITSD assumes they will contract out the programming
and development cost for this new program. ITSD estimates the project would take 1,057 hours
at a contract rate of $95 for a total cost of $100,445 in FY 2025 only. Oversight will reflect the
ITSD estimated cost of $100,445 in FY 2025.
Oversight notes that the Missouri Gaming Commission and the Department of Revenue have
stated the proposal will have a direct fiscal impact on total state revenue.
Oversight currently does not have the data or resources available to produce independent
revenue projections or to estimate the elasticity of demand for sports wagering in relation to
other games of chance offered at casinos or the Missouri Lottery. Since the “Economic Impact of
Legalized Sports Betting” report used by the DOR to forecast potential sports betting income L.R. No. 5715H.01I
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was published in May 2017, Oversight will use only the estimates provided by the MGC for
fiscal note purposes.
FYMGCDOR (low)DOR (high)2025Sports Betting AGR$76,396,382$202,200,000$253,300,00010% tax on AGR
(state portion - 90%)
$6,875,674$18,198,000$22,797,00010% tax on AGR
(local portion - 10%)
$763,964$2,022,000$2,533,0002026Sports Betting AGR$222,153,520$202,200,000$253,300,00010% tax on AGR
(state portion - 90%)
$19,993,817$18,198,000$22,797,00010% tax on AGR
(local portion - 10%)
$2,221,535$2,022,000$2,533,0002027Sports Betting AGR$311,649,297$202,200,000$253,300,00010% tax on AGR
(state portion - 90%)
$28,048,437$18,198,000$22,797,00010% tax on AGR
(local portion - 10%)
$3,116,493$2,022,000$2,533,0002028Sports Betting AGR$346,911,217$202,200,000$253,300,00010% tax on AGR
(state portion - 90%)
$31,222,010$18,198,000$22,797,00010% tax on AGR
(local portion - 10%)
$3,469,112$2,022,000$2,533,0002029Sports Betting AGR$385,915,998$202,200,000$253,300,00010% tax on AGR
(state portion - 90%)
$34,732,440$18,198,000$22,797,00010% tax on AGR
(local portion - 10%)
$3,859,160$2,022,000$2,533,000 L.R. No. 5715H.01I
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Officials from the MHP state the Sports Wagering portion of the proposed legislation would
authorize and regulate this activity in Missouri’s thirteen (13) existing casinos. The Patrol
anticipates the need for two (2) additional FTE for background investigations and subsequent
renewals for sports wagering vendors, and four (4) additional FTE for enforcement duties, with
two (2) positions for the St. Louis region and two (2) positions for the Kansas City region. This
function would be paid from the Gaming Fund (0286).
The number of fingerprint or name only criminal record checks performed based on the
regulatory criteria for the sports wagering section of this proposed legislation is unknown.
Fees for the name or fingerprint based criminal history check and how much is deposited into the
Criminal Record System Fund for each check performed is provided below:
State and Federal Fingerprint Criminal History Fee - $22.00 to the Criminal Record System Fund
(0671);
State Name Criminal History Fee - $15.00 to the Criminal Record System Fund (0671)
In addition to the expense indicated for the twenty (20) trooper positions (14 related to VLT
provisions and 6 to sports wagering provisions) that will be transferring from Highway funded
positions, it is assumed there will be an unknown savings to the Highway Fund (0644), as those
tenured troopers would be replaced with Highway-funded probationary troopers.
Oversight does not have any information to the contrary. Therefore, Oversight will reflect the
estimated FTE to the Gaming Commission Fund as well as an Unknown savings to the Highway
Fund.
Oversight further assumes income into the Criminal Records System Fund for both the Video
Lottery Control Act and the Sports Wagering provisions of this proposal will exceed $250,000
per year.
Bill as a Whole
Officials from the Department of Mental Health (DMH) assume the increase in gambling
opportunities will increase the number of individuals who voluntarily seek treatment for a
gambling problem. However, the bill does not mandate that any individual receive treatment and
treatment will remain voluntary. Therefore, DMH assumes that expenditures cannot exceed the
balance of the Compulsive Gamblers Fund (#0249) and no State General Revenue beyond that
balance will be expended.
In FY23 DMH served approximately 25 consumers through compulsive gambling (CG)
treatment services with an average cost of $987 per consumer for a total of $24,675. L.R. No. 5715H.01I
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A recent prevalence study was conducted in Missouri (Spare, K., Wiley, H. D., Mills, D. J., Lee,
U., & Lewis, L. E. (2023) 2022 Missouri Gambling Prevalence Study) revealed that from a
sample of 3,259 adults, 4.1% of the population or 200,000 adult Missourians met the criteria for
a Gambling Disorder, and an additional 20.8% (or 1 million adult Missourians) were at risk for a
gambling disorder. According to the journal Addiction, by the Society for the Study of
Addiction, 1 in 5 people with problem gambling had sought help for problem gambling. Other
more conservative research studies estimate 10% of individuals with a gambling disorder seek
treatment.
Based on the recent prevalence study, if even .05% of the estimated total of Missourians meeting
the criteria for a gambling disorder sought treatment, the number would be equal to 1,000
individuals. Based on our current numbers and in the event of serving 100 individuals with an
average cost per consumer at $987 for FY23, it would equate to $98,700.
Currently, DMH has seven (7) certified compulsive gambling treatment providers; this number
would likely need to increase over time along with the need for additional compulsive gambling
counselors. DMH estimates 25 new compulsive gambling counselors will be needed throughout
the state, with initial cost for training new counselors estimated at $8,000 in FY 25. If additional
advertising is needed, DMH anticipates annual cost for advertising with public service
announcements for help with compulsive gambling at $166,400. Total cost to DMH would be
estimated at $227,583 in FY 25. For FY 26, the cost would be $278,562 and in FY 27, the cost
would be $284,133 or more based upon the need for compulsive gambling services.
Oversight notes section 313.1021.6 requires $500,000 be appropriated from the Gaming
Commission Fund and credited annually to the Compulsive Gamblers Fund. In addition,
gamblers that have signed a voluntarily exclusion document will forfeit winnings and the
winnings will be credited to the Compulsive Gamblers Fund (§313.813). It is unknown how
much in winnings may be forfeited but Oversight assumes the amount could exceed $250,000
annually.
Oversight will reflect the estimated cost provided by DMH and will also reflect the transfers of
monies as required by Section 313.1021.6.
The balance of the Compulsive Gamblers Fund (0249) was $103,805 on July 1, 2023 and
$102,884 on December 31, 2023.
Officials from the University of Missouri System (UM) state this proposal would have a
significant negative financial impact due to increased monitoring and educational requirements.
Officials from the University of Central Missouri (UCM) state the proposal would have an
indeterminate fiscal impact and increased costs to monitor sports wagering activities. L.R. No. 5715H.01I
Bill No. HB 2835
Page 27 of 38
April 29, 2024
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Oversight does not have any information to the contrary. Due to the limited number of colleges
and universities responding to this proposal, Oversight will reflect an Unknown cost to College
and University Funds. Oversight assumes the impact could exceed $250,000 annually
Officials from the Office of Attorney General (AGO)Oversight’s request
for a statement of fiscal impact. However, in response to similar legislation from the current
session (SB 852), the AGO assumed any potential litigation costs arising from this proposal
could be absorbed with existing resources. However, the AGO may seek additional
appropriations if the proposal results in a significant increase in litigation or investigation.
Oversight does not have any information to the contrary. Therefore, Oversight assumes the
AGO will be able to perform any additional duties required by this proposal with current staff
and resources and will reflect no fiscal impact to the AGO for fiscal note purposes.
Officials from the Office of Administration - Budget and Planning defer to the Department of
Public Safety, Missouri Gaming Commission for the potential fiscal impact of this proposal.
Officials from the Department of Corrections (DOC) state as misdemeanors fall outside the
purview of the DOC, this legislation will have no fiscal impact on the department.
Officials from the Department of Elementary and Secondary Education, the Department of
Higher Education and Workforce Development, the Missouri Department of
Transportation, the Missouri National GuardOffice of Administration, the Office of
the State Public DefenderOffice of the State Treasurer, the Office of the State Courts
Administrator, the City of O’Fallon, the City of Kansas City, Missouri State University,
Northwest Missouri State University, and the Missouri Office of Prosecution Services each
assume the proposal will have no fiscal impact on their organization. Oversight does not have
any information to the contrary. Therefore, Oversight will reflect a zero impact in the fiscal note
for these agencies.
Officials from the Department of Public Safety (DPS) - Missouri Veterans Commission
(MVC) defer to the DPS – Missouri Gaming Commission for response regarding the potential
impact of this proposal on their organization.
Rule Promulgation
Officials from the Joint Committee on Administrative Rules assume this proposal is not
anticipated to cause a fiscal impact beyond its current appropriation.
Officials from the Office of the Secretary of State notes many bills considered by the General
Assembly include provisions allowing or requiring agencies to submit rules and regulations to
implement the act. The Secretary of State's office is provided with core funding to handle a
certain amount of normal activity resulting from each year's legislative session. The fiscal impact
for this fiscal note to Secretary of State's office for Administrative Rules is less than $5,000. The L.R. No. 5715H.01I
Bill No. HB 2835
Page 28 of 38
April 29, 2024
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Secretary of State's office recognizes that this is a small amount and does not expect that
additional funding would be required to meet these costs. However, they also recognize that
many such bills may be passed by the General Assembly in a given year and that collectively the
costs may be in excess of what their office can sustain with their core budget. Therefore, they
reserve the right to request funding for the cost of supporting administrative rules requirements
should the need arise based on a review of the finally approved bills signed by the governor.
Oversight only reflects the responses received from state agencies and political subdivisions;
however, other cities, county officials and colleges and universities were requested to respond to
this proposed legislation but did not. A listing of political subdivisions included in the Missouri
Legislative Information System (MOLIS) database is available upon request.
FISCAL IMPACT – State
Government
FY 2025
(10 Mo.)
FY 2026FY 2027Fully
Implemented
(FY 2029)
GENERAL REVENUE
FUND
Cost – DOR (§§313.1000 –
313.1022) Tax collection
database p. 23($100,445)$0$0$0
Transfer-in from Lottery
Enterprise Fund
(§313.429.11) - for
supervising/enforcing
proposal and Public Safety
peace officer funding p.7$2,643,622$5,079,344$6,746,874
Could exceed
$6,746,874
ESTIMATED NET
EFFECT ON THE
GENERAL REVENUE
FUND$2,543,177$5,079,344$6,746,874
Could exceed
$6,746,874 L.R. No. 5715H.01I
Bill No. HB 2835
Page 29 of 38
April 29, 2024
HWC:LR:OD
STATE LOTTERY
FUND (0682)
Revenue – LOTCould exceed...Initial Application Fees
(§313.429.3) p. 11$985,950$985,950$985,950$985,950
Annual Renewal Fees &
Terminal Admin Fees
(§313.429.3) p.11
$1,684,375$4,144,700$5,829,075$5,829,075
VLT Proceeds (Local
Portion - 4% of the 33%
AGR) (§313.429.11) p.11$6,147,969$12,295,938$18,443,906$18,443,906
VLT Proceeds (State
Portion -29% of the 33%
AGR) (§313.429.10 &
313.431) p.8 &11
$50,750,742$101,441,485$152,162,226$152,162,226
Total Revenue – LOT$59,569,036$118,868,073$177,421,157$177,421,157Loss – LOT (§313.431)
Lost profits from Keno and
Pull-Tab Sales from
competition p. 8 &10($3,569,191)($14,276,763)($14,276,763)($14,276,763)
Transfer Out - to Lottery
Enterprise Fund
Up to
($17,220,828)
Up to
($25,323,763)
Up to
($33,311,565)
Could exceed
($33,311,565)
Transfer Out - to Lottery
Proceeds Fund to be
appropriated to DESE
(33% of AGR)
(§313.429.10) p.11
Could exceed
($38,779,017)
Could exceed
($79,267,547)
Could exceed
($129,832,829)
Could exceed
($129,832,829)
ESTIMATED
NETEFFECT ON THE
STATE LOTTERY
FUND $0$0$0$0 L.R. No. 5715H.01I
Bill No. HB 2835
Page 30 of 38
April 29, 2024
HWC:LR:OD
LOTTERY
ENTERPRISE FUND
(0657)
Transfer In – from State
Lottery Fund
Up to
$17,220,828
Up to
$25,323,763
Up to
$33,311,565
Could exceed
$33,311,565
Cost – LOT (§313.429)
p.4-8 & 10Could exceed...
Personal Service($1,232,467)($1,508,534)($1,538,704)($1,538,704)Fringe Benefits($815,656)($922,665)($934,360)($934,360)Equipment and Expense($2,640,780)($2,377,304)($2,435,584)($2,435,584)Total Costs – LOT($4,688,903)($4,808,503)($4,908,648)($4,908,648)FTE Change – LOT27 FTE27 FTE27 FTE27 FTECosts - MHP
(§313.429.12) p.9Could exceed...
Personal Services($1,195,280)($1,463,023)($1,492,283)($1,492,283) Fringe Benefits($1,064,397)($1,302,822)($1,328,878)($1,328,878) Other Cost($1,453,954)($322,826)($322,826)($322,826)Total Costs – MHP($3,713,631)($3,088,671)($3,143,987)($3,143,987)
FTE Change – MHP15 FTE15 FTE15 FTE15 FTE
Transfer-Out – to General
Revenue Fund
(§313.429.11) – for
administrative/enforcement
expenses and Public Safety
peace officer funding p.7($2,643,622)($5,079,344)($6,746,874)
Could exceed
($6,746,874)
Transfer Out – to Veterans
Commission Capital
Improvement Trust Fund
(§313.429.11) p.7 Up to ($26,703)Up to ($51,307) Up to ($68,150)
Could exceed
($68,150) L.R. No. 5715H.01I
Bill No. HB 2835
Page 31 of 38
April 29, 2024
HWC:LR:OD
LOTTERY
ENTERPRISE FUND
(continued)
Transfer Out - To
municipalities
4% of AGR of video
lottery game to
municipalities to cover
admin. costs (§313.429.10)
p.6 & 11($6,147,969)($12,295,938)($18,443,906)
Could exceed
($18,443,906)
ESTIMATED NET
EFFECT ON THE
LOTTERY
ENTERPRISE FUND $0$0$0$0
Estimated Net FTE Effect
on the Lottery Enterprise
Fund42 FTE42 FTE42 FTE42 FTE
LOTTERY PROCEEDS
FUND (0291)
Transfer In - from State
Lottery Fund to be
appropriated DESE
(§313.429.10) p.11
Could exceed
$38,779,017
Could exceed
$79,267,547
Could exceed
$129,832,829
Could exceed
$129,832,829
ESTIMATED NET
EFFECT ON THE
LOTTERY PROCEEDS
FUND
Could exceed
$38,779,017
Could exceed
$79,267,547
Could exceed
$129,832,829
Could exceed
$129,832,829 L.R. No. 5715H.01I
Bill No. HB 2835
Page 32 of 38
April 29, 2024
HWC:LR:OD
GAMING
COMMISSION FUND
(0286)
Revenue - MGC
(§§313.1006 – 313.1022)
Annual and Renewal Fees
p. 19 & 21 $2,950,000$4,225,000$4,225,000$4,225,000
Reinvestigation Fees -
(§313.1021) - $130,000 not
shown because occurs in
FY2028 p. 18 & 21$0$0$0$0
Cost – MGC (§§ 313.800 -
313.1022) p. 20
Personal Services($823,647)($988,376)($988,376)($988,376) Fringe Benefits($495,291)($594,349)($594,349)($594,349) Equipment and Expenses($206,762)($177,860)($177,860)($177,860) Socioeconomic study
p. 12-13($500,000)$0$0($500,000)
Other Cost* p. 20$0$0$0$0Total Cost – MGC($2,025,700)($1,760,585)($1,760,585)($2,260,585) FTE Change – MGC15 FTE15 FTE15 FTE15 FTECost – MHP (§§ 313.800 -
313.1022) p.25
Could
exceed…
Personal Services($498,240)($609,846)($622,043)($622,043) Fringe Benefits($443,683)($543,068)($553,929)($553,929) Other Cost($614,515)($128,069)($128,069)($128,069)Total Cost – MHP($1,556,438)($1,280,982)($1,304,041)($1,304,041) FTE Change – MHP6 FTE6 FTE6 FTE6 FTETransfer Out – to
Compulsive Gamblers
Fund (§313.1021) p. 9&18($500,000)($500,000)($500,000)($500,000) L.R. No. 5715H.01I
Bill No. HB 2835
Page 33 of 38
April 29, 2024
HWC:LR:OD
GAMING
COMMISSION FUND
(continued)
Loss – MGC – Loss of
revenue resulting from
video lottery competition
(§§313.427-313.437) p.18(Unknown)(Unknown)(Unknown)(Unknown)
ESTIMATED NET
EFFECT TO THE
GAMING
COMMISSION FUND
(Less than
$1,132,138)
Less than
$683,433
Less than
$660,374
Less than
$160,374
Estimated Net FTE Change
to the Gaming Commission
Fund21 FTE21 FTE21 FTE21 FTE
GAMING PROCEEDS
FOR EDUCATION
FUND (0285)
Revenue - (§313.1021 ) -
90% of the 10% Wagering
Tax p. 17, 21 & 24 $6,875,674$19,993,817$28,048,437$34,732,440
Loss – MGC – Loss of
revenue resulting from
video lottery competition
(§§313.427-313.437) p.18(Unknown)(Unknown)(Unknown)(Unknown)
ESTIMATED NET
EFFECT TO THE
GAMING PROCEEDS
FOR EDUCATION
FUND
Less than
$6,875,674
Less than
$19,993,817
Less than
$28,048,437
Less than
$34,732,440 L.R. No. 5715H.01I
Bill No. HB 2835
Page 34 of 38
April 29, 2024
HWC:LR:OD
HIGHWAY FUND
(0644)
Savings – MHP
((§§313.427-313.43 and
313.800 - 313.1022)
Tenured troopers
replacement p.25UnknownUnknownUnknownUnknown
ESTIMATED NET
EFFECT TO THE
HIGHWAY FUNDUnknownUnknownUnknownUnknown
COMPULSIVE
GAMBLERS FUND
(0249)
Income – MGC (§313.813)
-Forfeited winnings p.12UnknownUnknownUnknownUnknown
Transfer In – from Gaming
Commission Fund
(§313.1021.6) p. 9 & 18$500,000$500,000$500,000$500,000
Cost – DMH (§313.1021.6)
-Administrative cost for
treating additional
consumers p.26($227,583)($278,562)($284,133)($289,795)
ESTIMATED NET
EFFECT TO THE
COMPULSIVE
GAMBERS FUND
Could exceed
$272,417
Could exceed
$221,438
Could exceed
$215,867
Could exceed
$210,205 L.R. No. 5715H.01I
Bill No. HB 2835
Page 35 of 38
April 29, 2024
HWC:LR:OD
CRIMINAL RECORDS
SYSTEM FUND (0671)
Income – MHP
((§§313.427-313.43 and
313.800 - 313.1022) –
increase in background
check fees p.9 and 25UnknownUnknownUnknownUnknown
ESTIMATED NET
EFFECT ON THE
CRIMINAL RECORDS
SYSTEM FUNDUnknownUnknownUnknownUnknown
VETERANS
COMMISSION
CAPITAL
IMPROVEMENT
TRUST FUND
Transfer-in – from Lottery
Enterprise Fund
(§313.429.11) – up to 1%
of license fees and fines p.7Up to $26,703Up to $51,307Up to $68,150
Could exceed
$68,150
ESTIMATED NET
EFFECT ON THE
VETERANS
COMMISSION
CAPITAL
IMPROVEMENT
TRUST FUNDUp to $26,703Up to $51,307Up to $68,150
Could exceed
$68,150 L.R. No. 5715H.01I
Bill No. HB 2835
Page 36 of 38
April 29, 2024
HWC:LR:OD
COLLEGE &
UNIVERSITY FUNDS
Costs – Colleges &
Universities (§§313.1000 –
313.1022) - increased
monitoring p. 26-27(Unknown)(Unknown)(Unknown)(Unknown)
ESTIMATED NET
EFFECT ON COLLEGE
& UNIVERSITY FUNDS(Unknown)(Unknown)(Unknown)(Unknown)
FISCAL IMPACT –
Local Government
FY 2025
(10 Mo.)
FY 2026FY 2027Fully Implemented
(FY 2028)
LOCAL
GOVERNMENTS
– SCHOOL
DISTRICTS
Income – School
Districts
(§313.429.9) – Fine
income p.6$0 to Unknown$0 to Unknown$0 to Unknown$0 to Unknown
Income – School
Districts
(§313.1012) – Fine
income p.16$0 to Unknown$0 to Unknown$0 to Unknown$0 to Unknown
ESTIMATED NET
EFFECT ON
SCHOOL
DISTRICTS$0 to Unknown$0 to Unknown$0 to Unknown$0 to Unknown L.R. No. 5715H.01I
Bill No. HB 2835
Page 37 of 38
April 29, 2024
HWC:LR:OD
LOCAL HOME
DOCKS
Revenue - Home
Dock City or County
(§313.429.10) -
4% AGR p.11$6,147,969$12,295,938$18,443,906
Could exceed
$18,443,906
Revenue - Home
Dock City or County
(§313.1021) -
10% of the 10%
Wagering Tax p. 28$763,964$2,221,535$3,116,493$3,859,160
Loss – Home Dock
City or County –
Loss of gaming
revenue from video
lottery competition
(§§313.427-
313.437) p.18(Unknown)(Unknown)(Unknown)(Unknown)
ESTIMATED NET
EFFECT ON
LOCAL HOME
DOCKS
Less than
$6,911,933
Less than
$14,517,473
Less than
$21,560,399
Could exceed
$22,303,066
FISCAL IMPACT – Small Business
This legislation could have an impact on small businesses related to sports wagering.
FISCAL DESCRIPTION
This proposal modifies provisions relating to sports wagering.
This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space. L.R. No. 5715H.01I
Bill No. HB 2835
Page 38 of 38
April 29, 2024
HWC:LR:OD
SOURCES OF INFORMATION
Attorney General’s Office
Office of Administration - Budget and Planning
Department of Elementary and Secondary Education
Department of Higher Education and Workforce Development
Department of Mental Health
Department of Corrections
Department of Revenue
Department of Public Safety
Missouri Gaming Commission
Missouri Highway Patrol
Missouri Veterans Commission
Missouri Department of Transportation
Missouri National Guard
Office of Administration
Office of the Secretary of State
Office of the State Public Defender
Office of the State Treasurer
University of Missouri
Office of the State Courts Administrator
City of O’Fallon
City of Kansas City
Missouri State University
Northwest Missouri State University
University of Central Missouri
Joint Committee on Administrative Rules
Missouri Lottery Commission
Missouri Office of Prosecution Services
Julie MorffRoss StropeDirectorAssistant DirectorApril 29, 2024April 29, 2024