We just want to make sure that there is a good product out there for the patrons and something that we can be proud of here in Kansas — and to make sure that there is integrity in sports wagering.
Sports betting in Kansas took a big step forward last week, after regulators from the two agencies that will oversee the enterprise submitted separate temporary rules to the state’s attorney general for approval.
The first agency, the Kansas Racing and Gaming Commission (KRGC), finalized a list of temporary regulations at its meeting on Friday. KRGC said the interim regulations were immediately sent to Republican AG Derek Schmidt.
“With temporary regulations, there are a few less steps in the process,” Todd Allen, director of wagering for the KRGC, told WIBW-TV in Topeka. “It helps us to be able to expedite and get rules in place without having to go through a long process to get things started — that way we can also do permanent regulations at a later date.”
It was unclear when sports betting would officially start in the Sunflower State.
A review by the AG’s office is expected to take at least a few weeks, assuming there are no issues. The NFL season starts on September 8, so it’s likely that sports wagering will not be up and running in time.
“It seems like it’s taken forever to get sports wagering,” Allen said. “We just want to make sure that there is a good product out there for the patrons and something that we can be proud of here in Kansas — and to make sure that there is integrity in sports wagering.”
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Kansas Lottery Also Sent Proposed Rules to AG
Two days before the KRGC’s action, the Kansas Lottery Commission (KLC) — the other agency involved in the state’s new gaming enterprise — approved a list of 15 sports betting rules and submitted them to the AG’s office.
Neither the KRGC nor the KLC has updated on when sports betting may go live. The sports betting bill Democratic Governor Laura Kelly signed in May stipulated that mobile sports betting must be up and running by January 1, 2023. Several internal deadlines were also set to ensure regulators could meet the final deadline.
The law gives the KLC the power to regulate sports betting in the state and promulgate rules. But the KRGC, which governs the four commercial casinos in the state, will also play a role.
Under the gaming law, each of the state’s four commercial casinos and seven tribal casinos are allowed to offer three sports betting skins — meaning Kansas could have as many as 33 online sportsbooks.
Barstool and DraftKings Making Preparations
Operators have been busy registering customers in Kansas before the launch of sports betting. Several offered details in their recent Q2 2022 earnings calls over how much the competition for customers will cost operators in the short term.
On August 4, Penn Entertainment said it expects to incur approximately $50 million in EBIDTA (earnings before interest, taxes, depreciation, and amortization) losses by year’s end — with a sizeable chunk coming from high costs in Kansas that coincide with the start of the NFL season.
“We are optimistic about our upcoming sportsbook launches in Kansas and Ohio, where we have similar market-leading properties bolstered by large casino databases,” said CEO Jay Snowden.
Barstool will presumably be one of the three skins on the Hollywood Casino at Kansas Speedway license, considering Penn owns both.
The next day, DraftKings CEO Jason Robins said his company was preparing to launch an online sportsbook in Kansas and Maryland, Ohio, and Puerto Rico.
“Looking ahead to the longer term, the outlook for new state launches next year and beyond continues to be excellent,” Robins said. “Even assuming all of these states, including California, launched in late 2022 or 2023, we have more conviction than ever in our ability to reach positive free cash flow with our current capital reserves.”
DraftKings entered into an agreement to launch a mobile sportsbook at the Boot Hill Casino & Resort in May. Bally’s also signed a similar deal with the casino’s owner, Butler National Corporation.
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FanDuel and BetMGM are Making Plans, Too
On August 12, Flutter Entertainment CFO Jonathan Hill said the company would be “investing positively and aggressively, with our usual level of discipline, through Q3 2022, the run-up to the NFL season, and Q4 2022. We have Kansas coming live, we believe, in Q4 2022.”
FanDuel will likely open mobile and retail sportsbooks at the Kansas Star Casino, owned by Boyd Gaming. Boyd and FanDuel have been online casino gaming and sports betting partners since August 2018.
MGM Resorts International, which owns half of BetMGM, did not mention Kansas in its call on August 3. But the CEO of Entain, which owns the other half, called Kansas one of several “enormous opportunities” available to expand BetMGM’s business.
“We’re waiting now for Kansas and Massachusetts,” said Entain CEO Jette Nygaard-Andersen. “More importantly, we’re also waiting to see what happens in California. Right now, together with our partners at MGM, we’re focused on delivering on [our] strategy.”
