What would Amendment 2 do regarding sports betting?

The amendment would provide for the Missouri Gambling Commission to allow licensed entities to offer sports wagering through online sports wagering platforms to individuals located in the state, at excursion gambling boats, or at any location within each sports district. Sports wagering would be established in the state no later than December 1, 2025.^[1]

It would allow license fees and a 10% wagering tax on revenues received to be appropriated for education purposes, including public schools and higher education. It would also provide funding for the Compulsive Gambling Prevention Fund, which would include researching compulsive gambling, implementing treatment and recovery programs, and services related to compulsive gambling.

Currently, 38 states and D.C. have legalized sports betting. Five states—Arkansas, Colorado, Maryland, New Jersey, and South Dakota—approved ballot measures legalizing sports betting. New Jersey was the first state where voters approved a sports wagering ballot measure in 2011. After New Jersey modified its restrictions on legalized gambling in 2014, the NCAA, NBA, NFL, NHL, and MLB filed litigation in federal district court. The case, Murphy v. NCAA went up to the U.S. Supreme Court. On May 14, 2018, the U.S. Supreme Court ruled 7-2 that the federal government could not require states to prohibit sports betting, thereby overturning the federal ban on sports betting and allowing states to legalize sports betting.^[2]

Voters in California rejected two sports betting initiatives, while New Jersey voters rejected a sports betting initiative that would have permitted sports wagering for college sport competitions.

What are the arguments for and against this measure?

Only individuals 21 years of age or older would be able to participate in sports wagering.

State Sen. Denny Hoskins (R-21): “I’m not against putting that question on the ballot, but I’ve consistently said that the ballot language that they are using, I don’t believe best serves the people of Missouri. Number one, the tax rate is very low. The fees are very low. There’s not enough money in there for problem compulsive gambling, which is going to be caused by legalization of sports betting here in the state. … The casinos, I’ve seen, would net an increase of $25 million a piece. Let me say that again, if sports betting passes in the state of Missouri, casinos will net another $25 million in net profit going to their bottom line. So, I want to make sure that Missourians are protected.”

Jack Cardetti, spokesman of Winning Missouri Education: “Missouri is one of only about a dozen states that hasn’t legalized sports betting. And that means we lose out on millions of dollars that could be going to our classrooms, and millions of dollars of economic opportunity. So if this ballot initiative passes, Missourians will be able to place sports bets in a responsible, regulated manner.”

Section 39(g) 1. The people of the state of Missouri hereby find and declare that the interests of the public are best served by a well-regulated sports wagering industry that will provide substantial tax revenue to support educational institutions in Missouri. 2. Notwithstanding any other provision of law to the contrary, any entity licensed by the Commission pursuant to Article III, Section 39(g) may offer sports wagering: a. through an online sports wagering platform to individuals physically located in this state; b. at excursion gambling boats; and c. at any location within each sports district, as approved by each applicable professional sports team that plays its home games in such sports district. 3. A licensee shall not offer sports wagering to individuals who are under twenty-one years of age. 4. a. The Commission shall issue not more than one retail license to operate sports wagering in this state to each qualified applicant that is: (1) an excursion gambling boat or a sports wagering operator operating on behalf of each such excursion gambling boat that has applied for a retail license to offer sports wagering at such excursion gambling boat; or (2) a professional sports team or a sports wagering operator designated by each such professional sports team that has applied for a retail license to offer sports wagering within the applicable sports district in which such professional sports team plays its home games. b. The Commission shall issue not more than one mobile license to operate sports wagering in this state to each qualified applicant that is: (1) an owner of an excursion gambling boat located in this state or a sports wagering operator operating on behalf of each such owner, provided, however, that not more than one sports wagering operator shall be permitted to operate under such mobile license on behalf of any entity, or group of commonly owned or controlled entities, which owns, directly or indirectly, more than one excursion gambling boat located in this state; or (2) a professional sports team or a sports wagering operator designated by each such professional sports team. c. The Commission shall issue not more than two mobile licenses to operate sports wagering in this state directly to qualified applicants that are sports wagering operators. Each sports wagering operator shall only be eligible for one mobile license per distinct sports wagering operator brand. For purposes of Article III, Section 39(g) brand shall refer to the name, trade name, licensed trademark, or assumed business name of the sports wagering operator. If there are more than two qualified applicants for a mobile license to be issued by the Commission directly to a sports wagering operator under this section, the Commission shall select the applicant for licensure based on the applicant’s ability to satisfy the following criteria: (1) Expertise in the business of online sports wagering: (2) Integrity, sustainability, and safety of the applicant’s online sports wagering platform; (3) Past relevant experience of the applicant; (4) Advertising and promotional plans to increase and sustain revenue; (5) Ability to generate, maximize, and sustain revenues for the state; (6) Demonstrated commitment to and plans for the promotion of responsible gaming; and (7) Capacity to increase the number of bettors on the applicant’s online sports wagering platform. 5. An applicant for a license to conduct sports wagering shall apply to the Commission on a form and in the manner prescribed by the Commission. The Commission shall conduct background checks of each applicant or key persons of such applicant and shall not award a license to any applicant if such applicant or key person of such applicant has been convicted of a felony or any gambling offense in any state or federal court of the United States. If a professional sports team designates a sports wagering operator to operate on its behalf, then that sports wagering operator, rather than the professional sports team, shall submit to the Commission for licensure and shall be considered the licensee for all aspects of Commission oversight and regulatory control. In the application, the Commission shall require applicants to disclose the identity of all of the following: a. The applicant’s principal owners who directly own 10% or more of the applicant: b. Each holding, intermediary, or parent company that directly owns 15% or more of the applicant; and c. The applicant’s board appointed chief executive officer and chief financial officer, or the equivalent individuals, as determined by the Commission. 6. Retail and mobile license applicants shall be required to pay a license fee as follows: a. An applicant for a retail license shall be required to pay a license fee prescribed by the Commission, not to exceed $250,000. Retail licensees shall be required to pay a license renewal fee every five years, as prescribed by the Commission, not to exceed $250,000. b. An applicant for a mobile license shall be required to pay a license fee prescribed by the Commission, not to exceed $500,000. Mobile licensees shall be required to pay a license renewal fee every five years, as prescribed by the Commission, not to exceed $500,000. 7. a. A license for sports wagering shall not be assignable or transferable without approval of the Commission. Such approval shall not be unreasonably withheld. b. A license shall authorize a licensee to offer sports wagering under not more than one sports wagering operator brand, provided, however, that such licensee shall also be permitted, but not required, to use the brand of a professional team or excursion gambling boat pursuant to a partnership with such entity. Notwithstanding any other provision of law to the contrary and subject to approval by the Commission, a person or entity may hold and operate more than one license under distinct sports wagering operator brands, regardless of whether multiple brands are owned by the same parent entity. c. Commercial agreements between an excursion gambling boat or a professional sports team and a sports wagering operator shall be submitted to the Commission as agreed to by the contracting parties. The Commission shall not prescribe any terms or conditions that are required to be included into such commercial agreements. A sports governing body or professional sports team may enter into commercial agreements with sports wagering operators or other entities in which such sports governing body or professional sports teammay share in the amount wagered on sporting events of such sports governing body or professional sports team. A professional sports team may grant any such rights provided under this paragraph to its affiliate. Neither a sports governing body nor a professional sports team, nor such team’s affiliate, is required to obtain a license or any other approval from the Commission to lawfully accept such amounts. d. Each mobile licensee shall determine, set, and display applicable lines, point spreads, odds, or other information pertaining to online sports wagering. e. Any submission to the Commission under this section, including all documents, reports, and data submitted therewith, that contain proprietary information, trade secrets, financial information, or personal information about any person or entity shall be treated in the same confidential manner as submissions by other licensees of the Commission and shall not be subject to disclosure pursuant to Chapter 610 RSMO. 8. All sports wagering fees prescribed by the Commission and collected by the state shall be appropriated as follows: a. to reimburse the reasonable expenses incurred by the Commission to regulate sports wagering; and b. to the extent all reasonable expenses incurred by the Commission have been reimbursed, the remaining fees shall be deposited in the Compulsive Gaming Prevention Fund. 9. Subject to and consistent with the terms of this section, the Commission shall have the power to adopt and enforce commercially reasonable rules, including emergency rules, to implement the provisions of this section. No rule or portion of a rule promulgated under the authority of this section shall become effective unless it has been promulgated pursuant to the provisions of Chapter 536. The Commission shall examine the rules implemented in other states where sports wagering is conducted and shall, as far as practicable, adopt a similar regulatory framework. including, but not limited to: a. Standards governing the security and integrity of sports wagering, including requiring the use of official league data on the terms and conditions set forth below from each applicable sports governing body headquartered in the United States solely for the purposes of determining the outcome of tier two sports wagers on a professional athlete or sporting event, but only if made available to licensees on commercially reasonable terms. Sports wagering operators may use any data source for determining the results of any and all tier one sports wagers on any and all sporting events, and the results of any and all tier two sports wagers on sporting events of an organization that is not headquartered in the United States. (1) A sports governing body may notify the Commission that it desires sports wagering operators to use official league data to settle tier two sports wagers on sporting events of such sports governing body. Such notification shall be made in the form and manner the Commission may require. The Commission shall notify each sports wagering operator of a sports governing body’s notification within five days of the Commission’s receipt of such notification. If a sports governing body does not notify the Commission of its desire to supply official league data, a sports wagering operator may use any data source for determining the results of any and all tier two sports wagers on sporting events of such sports governing body. (2) Within 60 days of the Commission notifying each sports wagering operator of a sports governing body’s notification to the Commission, or such longer period as may be agreed between the sports governing body and the applicable sports wagering operator, sports wagering operators shall use only official league data to determine the results of tier two sports wagers on sporting events of that sports governing body, unless: (a) The sports governing body or its designee cannot provide a feed of official league data to determine the results of a particular type of tier two sports wager, in which case sports wagering operators may use any data source for determining the results of the applicable tier two sports wager until such time as such a data feed becomes available from the sports governing body on commercially reasonable terms and conditions; (b) A sports wagering operator can demonstrate to the Commission that the sports governing body or its designee will not provide a feed of official league data to the sports wagering operator on commercially reasonable terms and conditions; or (e) The sports governing body or its designee does not obtain the necessary supplier approvals to provide official league data to sports wagering operators to determine the results of tier two sports wagers, if and to the extent required by law. (3) The following is a non-exclusive list of factors that the Commission may consider in evaluating official league data is being offered on commercially reasonable terms and conditions for the purposes of paragraphs (a) and (b) of subsection (2): (a) The availability of a sports governing body’s tier two official league data to a sports wagering operator from more than one authorized source: (b) Market information, including, but not limited to, price and other terms and conditions. regarding the purchase by sports wagering operators of comparable data for the purpose of settling sports wagers in this state and other jurisdictions; (c) The nature and quantity of data, including the quality and complexity of the process utilized for collecting such data; and (d) The extent to which sports governing bodies or their designees have made data used to settle tier two bets or wagers available to operators and any terms and conditions relating to the use of that data. (4) Notwithstanding anything set forth to the contrary herein, including without limitation subparagraph (3), during the pendency of the Commission’s determination as to whether a sports governing body or its designee will provide a feed of official league data on commercially reasonable terms, a sports wagering operator may use any data source for determining the results of any and all tier two sports wagers. The Commission’s determination shall be made within 120 days of the sports wagering operator notifying the Commission that it desires to demonstrate that the sports governing body or its designee will not provide a feed of official league data to the sports wagering operator on commercially reasonable terms. b. Standards concerning a licensee’s books and financial records relating to sports wagering, including auditing requirements, standards for the daily counting of a licensee’s gross receipts from sports wagering, and standards to ensure that internal controls are followed; c. Standards for the use and distribution of monies from the Compulsive Gaming Prevention Fund shall include, but not be limited to, research, detection, and prevention of compulsive gaming, the implementation of treatment and recovery programs, or services related to compulsive gaming in this state; d. Standards concerning the detection and prevention of compulsive gaming including, but not limited to, requirements to prominently display information regarding compulsive gaming on all online sports wagering platforms and promotions; e. Requiring licensees to cooperate with investigations conducted by law enforcement agencies, regulatory bodies, and sports governing bodies; f. Standards for licensees and sports wagering operators to report to the Commission and the sports governing bodies information related to: abnormal betting activity or patterns that may indicate a concern with the integrity of a sporting event or events; suspicious or illegal betting activities if known to the applicable licensee or sports wagering operator; and any other conduct that corrupts a betting outcome of a sporting event or events for purposes of financial gain, including match fixing; g. Standards for any sports governing body to submit to the Commission a written request to restrict, limit, or exclude a certain type, form, or category of sports betting with respect to a sporting event of that sports governing body, if the applicable sports governing body believes that such type, form, or category of sports wagering with respect to the sporting event of the sports governing body may undermine the integrity or perceived integrity of the applicable sports governing body or sporting events of the applicable sports governing body. These standards shall also require the Commission to request comment from sports wagering operators on all requests made pursuant to this paragraph and after giving due consideration to all comments received, the Commission shall, upon a demonstration of good cause from the applicable sports governing body that such type, form, or category of sports betting is likely to undermine the integrity or perceived integrity of such body or sporting events of the applicable sports governing body, grant the request. These standards shall require the Commission to respond to a request concerning a sporting event before the start of the event, or, if it is not feasible to respond before the start of the event, no later than 7 days after the request is made, and if the Commission determines that the applicable sports governing body is more likely than not to prevail in successfully demonstrating good cause for its request, the Commission may provisionally grant the request of the applicable sports governing body pending the Commission’s final determination thereon. Unless the Commission provisionally grants the request, sports wagering operators may continue to offer sports betting and accept bets on the covered sporting event pending a final determination by the Commission; h. Requiring licensees and sports wagering operators to use commercially and technologically reasonable means to ensure that marketing and advertisements do not purposefully target minors or individuals who have self-excluded from sports wagering, are not false, misleading or deceptive, and clearly disclose the material terms of any offer included in any promotion or advertisement; i. Standards for the regulation of suppliers of sports wagering goods, services, software, or any other components necessary for the creation of sports wagering markets and determination of wager outcomes; j. Standards for the implementation of responsible gaming programs, including using commercially reasonable efforts to verify that a person placing a bet on a sporting event is of the legal minimum age for placing such bet, displaying a hyperlink on its online sports wagering platform to responsible gaming information, allowing individuals to voluntarily exclude themselves from placing bets with the operator through a process established by the Commission, and allowing persons to place limits on their time, deposit, or bet limits in a daily, weekly, or monthly manner; k. Establishing fines, placing licensees on probation, and revoking licenses for violations of this section. The Commission may impose fines upon any person holding, or required to hold, a license or approval under this section or the rules subsequently adopted. Fines shall not exceed $50,000 per violation or $100,000 resulting from violation of the same occurrence of events. The Commission shall promulgate rules relating to procedures for disciplinary hearings, including that any such decision may be appealed to circuit court; 1. Establishing a start date for all sports wagering that is not later than December 1, 2025. No sports wagering, either retail or mobile, shall be offered in the state before such start date established by the Commission. No category of license shall be given an earlier launch date over any other category of license; and m. Prohibiting all sports wagering activity, including sports wagering promotional and advertising activity, within a sports district, unless approved by the professional sports team that plays its home games within the district, except such rules shall not prohibit any licensee from offering sports wagering through an online sports wagering platform to persons physically located within a sports district. 10. a. Notwithstanding any other provision of law, including Article III Section 39(d), to the contrary, a wagering tax of 10% is imposed on the adjusted gross revenue received from sports wagering conducted by each licensee and each sports wagering operator acting on behalf of a licensee. b. The annual revenues received from such tax shall be appropriated for institutions of elementary, secondary, and higher education in this state; provided, however, that an appropriation to such educational institutions shall be made only after such annual wagering tax revenues are appropriated as follows: (1) to reimburse the reasonable expenses incurred by the Commission to regulate sports wagering in the state to the extent that the Commission has not been fully reimbursed for such expenses from the sports wagering fees collected by the state; and (2) the greater of 10% of such annual tax revenues or $5,000,000 to the Compulsive Gaming Fund. c. Such revenues shall not be included within the definition of “total state revenues” in Section 17 of Article X of this Constitution. d. The state auditor shall perform an annual audit of the revenues received and appropriated pursuant to this section to ensure they are being used only for authorized purposes. The state auditor shall make such audit available to the public, the governor, and the general assembly. 11. A mobile licensee shall maintain in this state, or any other location approved by the Commission and consistent with federal law, the computer server or servers used to receive transmissions of requests to place wagers and that transmit confirmation of acceptance of wagers on sports events placed by customers physically present in this state. 12. All wagers authorized under this section must be initiated, made, or otherwise placed by a bettor while physically present within this state. The intermediate routing of electronic data related to lawful intrastate wagers authorized under this section shall not determine the location or locations in which the bet is initiated, transmitted, received, or otherwise made. Each online sports wagering operator shall use commercially reasonable geolocation and geofencing technology to ensure that it accepts bets only from customers who, at the time of placing the bet. are physically present in this state. 13. a. An individual wagering in this state shall establish an online sports wagering account with an online sports wagering operator: (1) over the Internet; (2) through an online sports wagering platform; or (3) through other means approved by the Commission. b. An individual wagering in this State shall not register more than one account with each online sports wagering platform. Mobile licensees shall use commercially reasonable means to ensure that each customer is limited to one account per platform. c. Permissible methods of funding and withdrawal for accounts include, but are not limited to, credit cards, debit cards, gift cards, reloadable prepaid cards, free and promotional credit. automated clearing house transfers, online and mobile payment systems that support online money transfers, and wire transfers. The Commission may approve additional funding and withdrawal methods including, but not limited to, cash deposits at approved locations and secure cryptocurrencies. 14. a. A sports wagering operator shall use commercially and technologically reasonable means to ensure marketing and advertisements do not purposefully target individuals who have self- excluded from placing bets on sporting events. b. A sports wagering operator shall employ commercially reasonable methods to ensure that advertisements for sports betting: (1) do not purposefully target minors; (2) are not false, misleading, or deceptive to a reasonable consumer; and (3) clearly and conspicuously disclose the material terms of any promotional offer in the advertisement. Any promotion or advertisement must provide the consumer with the full and complete terms of a promotion by providing a website, or other location, in the promotional advertisement, that directs the viewer to where the full and complete promotional terms can be viewed. This may be satisfied by the promotional advertisement containing a hyperlink that takes the viewer directly to the full and complete offer and terms. 15. There is hereby created in the state treasury the “Compulsive Gaming Prevention Fund”, which shall consist of taxes and fees collected under this section. The state treasurer shall be custodian of the fund, and he or she shall invest monies in the fund in the same manner as other funds are invested. Any interest and monies earned on such investments shall be credited to the fund. Notwithstanding any other provision of law to the contrary, any monies remaining in the fund at the end of a biennium shall not revert to the credit of the general revenue fund. The fund shall be a dedicated fund and shall be utilized by the Commission for the purposes of: a. providing counseling and other support services for compulsive and problem gamers; b. developing and implementing problem gaming treatment and prevention programs; and c. providing grants to supporting organizations that provide assistance to compulsive gamers. 16. As used in this section the following terms shall mean: a. “Adjusted gross revenue,” the total of all cash and cash equivalents received by a licensee from sports wagering minus the total of: (1) All cash and cash equivalents paid out as winnings to sports wagering customers (2) The actual costs paid by a licensee for anything of value provided to and redeemed by customers, including merchandise or services distributed to sports wagering customers to incentivize sports wagering: (3) Voided or cancelled wagers; (4) The costs of free play or promotional credits provided to and redeemed by the applicable licensee’s customers, provided that the aggregate amount of such costs of free play or promotional credits that may be deducted under this paragraph in any calendar month shall not exceed twenty-five percent of the total of all cash and cash equivalents received by the applicable licensee for such calendar month; (5) Any sums paid as a result of any federal tax, including federal excise tax; and (6) Uncollectible sports wagering receivables, not to exceed two percent of the total of all sums, less the amount paid out as winnings to sports wagering customers (7) If the amount of adjusted gross receipts in a calendar month is a negative figure, the licensee shall remit no sports wagering tax for that calendar month. Any negative adjusted gross receipts shall be carried over and calculated as a deduction in the subsequent calendar months until the negative figure has been brought to a zero balance. b. “Commission,” means the Missouri Gaming Commission; c. “Excursion gambling boat,” means an excursion gambling boat or floating facility as described in Article III, Section 39(e); d. “License,” means any retail license or mobile license. e. “Licensee,” means the holder of any retail or mobile license. f. “Mobile license,” means a license, granted by the Commission, authorizing the licensee to offer sports wagering, through an online sports wagering platform, to individuals physically located in this state. g. “Online sports wagering platform,” means an online-enabled application, Internet website, or other electronic or digital technology used to offer, conduct, or operate mobile sports wagering. h. “Professional sports team,” means a team located in this state that is a member of the National Football League, Major League Baseball, the National Hockey League, the National Basketball Association, Major League Soccer, the Women’s National Basketball Association, or the National Women’s Soccer League. i. “Retail license,” means a license, granted by the Commission, authorizing the licensee to offer sports wagering in person to individuals at such locations described in paragraphs (b) and (c) of Article III, Section 39(g)(2), as applicable. j. “Sports district,” means the premises of a facility located in this state with a capacity of 11,500 people or more, at which one or more professional sports teams plays its home games, and the surrounding area within 400 yards of such premises; k. “Sports wagering.” means wagering on professional or collegiate athletic, sporting, and other competitive events and awards involving human participants including, but not limited to, esports, or any other events as approved by the Commission. The term sports wagering shall include, but not be limited to, bets or wagers made on: portions of athletic and sporting events or on the individual statistics of professional or collegiate athletes in a sporting event or compilation of sporting events. Sports wagering shall not include: (1) a fantasy sports contest comprising multiple participants competing against one another in which winning outcomes reflect the relative knowledge and skill of the participants and are predominantly determined by the accumulated statistical performance of athletes or individuals. A fantasy sports contest operator shall not qualify as a “participant” for purposes of this section; and (2) wagering on the performance or nonperformance of any individual athlete participating in a single game or match of a collegiate sporting event in which a collegiate team from this state is a participant; and (3) wagering on youth or high school events. 1. “Sports wagering operator,” means an entity that offers sports wagering or has been organized for the purpose of offering sports wagering. m. “Tier one sports wager,” means a sports wager that is determined solely by the final score or final outcome of the sporting event and is placed before the sporting event has begun. n. “Tier two sports wager,” means a sports wager that is not a tier one sports wager. 17. Notwithstanding any other provision of law, including Article III, Section 39(9), to the contrary, the general assembly may enact laws consistent with this section. 18. All provisions of this section are severable. If any provision of this section is found by a court of competent jurisdiction to be unconstitutional or unconstitutionally enacted, the remaining provisions of this section shall be and remain valid. ^[6]