Kansas Gov. Laura Kelly on Kansas City Chiefs headquarters moving to Olathe
The Kansas City Chiefs will be moving their stadium, headquarters and practice facility to Kansas. Kansas Governor Laura Kelly spoke on the team’s move.
If you’ve lost a sports bet in Kansas, you are helping fund Kansas’s economic development deal with the Kansas City Chiefs.
When Kansas legalized sports betting in 2022, it imposed a 10% tax on all sports betting revenue. Kansas calculates sports betting revenue as the amount of money wagered, minus prizes, promotional deductions and federal taxes.
Sports betting tax revenue mostly goes to the Attracting Professional Sports to Kansas fund, with 80% earmarked for the fund after the first $750,000 accumulates.
The first $750,000 goes to a fund to police illegal gambling, 2% goes to the state’s Problem Gambling and Addiction Grant fund and the remaining 18% goes to the Lottery Operating Fund to oversee the sports betting program and the State General Fund.
The sports team fund has amassed about $26 million in its lifetime.
Sports betting a portion of estimated $4 billion in incentives for Chiefs
Kansas’s main funding mechanism for the Chiefs was an expanded version of Sales Tax and Revenue Bonds, or STAR Bonds. It allows for bonds to be issued, and repaid with sales tax in a special taxing district in and around a development.
The state will contribute about 60% of the funding for construction, a total amount of about $1.8 billion, with private funding accounting for the remaining 40%.
The term sheet between the state of Kansas and the Chiefs says the state will pledge 65% of the money deposited into the Attracting Professional Sports to Kansas Fund directly toward STAR Bonds themselves. It also pledges 10% of the fund to the “RMMO Fund,” which will pay off the $7 million yearly rent the Chiefs will owe Kansas.
In Fiscal Year 2025, the state’s share of sports betting was $17.5 million. In total, sports betting is a small portion of the estimated $4 billion in incentives the state is offering the Chiefs to build a stadium, training facility and corporate headquarters.