The Kansas Legislature on Tuesday passed an aggressive plan to attract the Kansas City Chiefs and Royals, triggering a process that could lead to the state issuing billions in bonds to build new stadiums – debt that will take decades of sales tax, sports betting and Lottery revenues to repay.
The sweeping proposal, which Democratic Gov. Laura Kelly is expected to sign or allow to become law without her signature, sets up a confrontation between Kansas and Missouri over the future of the teams. Benefiting are the teams, who can now ask Kansas to finance the bulk of the cost of building stadiums.
The vote represents a major bet by Kansas that both teams and their sports will remain popular, economically viable enterprises into the second half of the 21st century and comes despite extensive research that shows stadiums don’t often generate enough revenues to pay back the public benefits they receive. It followed an intense lobbying blitz in favor of the plan, with both the Chiefs and Royals working to instill a sense of urgency among lawmakers.
“Are you going to step up today and take a leap of faith and make this happen-keep them in the metroplex and bring money to Kansas?” Rep. Sean Tarwater, a Stilwell Republican who has championed the proposal, told lawmakers.
The House passed the bill 84-38. The Senate followed in a 27-8 vote. The votes scrambled typical partisan divides, with a mix of Republicans and Democrats providing the support necessary for passage.
Lawmakers passed the plan in special session initially called for tax cuts. The legislation came after Jackson County voters in April rejected a stadiums sales tax that would have guaranteed the teams remain in Kansas City.
The broad support for the plan reflected a clear desire to ensure the Chiefs and the Royals don’t leave the Kansas City region, as well as the lure of a major league sports team calling Kansas home. Still, a sizeable minority of lawmakers objected, warning that the Legislature was rushing into a process without adequate consideration.
The legislation authorized Kansas to potentially issue Sales Tax and Revenue, or STAR bonds to pay for up to 70% of the cost of stadiums for one or both teams –up form the 50% in current law. A Chiefs stadium alone could cost at least $2 billion. A Royals stadium could be another $1.5 billion, if not more.
The debt would be repaid over 30 years by a combination of tax revenue from the stadiums and surrounding development, sports gambling revenue and Lottery revenue. As part of the bill, annual Lottery revenues above $71.5 million each year will now be redirected into a fund to help pay off the bonds, a change likely worth about $10 million a year.
“I understand the excitement behind the prospect, it is like this Christmas Eve and there’s visions of sugar plums only it’s royal blue and crimson and gold in this case,” said Sen. Molly Baumgardner, a Louisburg Republican. “But we haven’t seen tremendously successful STAR bound projects that haven’t brought us anything other than what would have naturally developed in that area.”
The Chiefs and Royals have not promised to come to Kansas if the bill becomes law. But they have made positive comments about the legislation, describing it as an “option” as they evaluate where to head after their leases at the Truman Sports Complex expire in 2031.
“We’re here talking about the Kansas City Chiefs coming to Kansas. How unbelievable is that?” Korb Maxwell, an attorney representing the Chiefs, told lawmakers this week. “It’s just a pinch ourselves moment.”
STAR bound have been a controversial program used over the past two decades to build projects large and small across the state. It financed the Kansas Speedway, arguably the most successful use of the program but also financed Prairiefire in Overland Park, which defaulted last year.
A Chiefs or Royals stadium – or both – would mark the largest STAR bond project ever.
The bill passed in a lightning-fast single day. The House began debating the plan just hours after it was introduced. A single hearing – using unofficial bill text – was held on Monday.
“It is amazing to me the speed with which we can solve problems when they’re oriented around wealth, when they’re oriented around business,” Rep. Jason Probst, a Hutchinson Democrat, said.
Kelly has not been outspoken about the proposal. On Monday the governor told reporters the plan was “not something I’m going to invest a lot of energy in.” Her chief of staff, Will Lawrence, later said the governor had no concerns “that would warrant a veto.”
Sen. J.R. Claeys, a Salina Republican, said a sense of urgency exists around securing the future of the Chiefs. He emphasized that the bill contains guardrails and that while the bill authorized 70% STAR bond financing, it doesn’t require it.
“This is probably the least risky STAR bond project in the history of STAR bond projects in line with the Speedway,” Claeys said.
Academic studies consistently show stadiums are not major drivers of economic growth. A 2022 review found that nearly all empirical studies found “little to no tangible impacts of sports teams and facilities on local economic activity” and that the level of subsidies typically provided for stadiums “far exceeds any observed economic benefits.”
Any identified economic effects typically occurred in the area immediately surrounding a stadium, but those impacts weren’t always present and “can not be generally applied to all stadium projects.”
Some lawmakers voiced deep reservations with the proposal and the long-term consequences to the state. Rep. Bob Lewis, a Garden City Republican, said studies uniformly show stadium projects almost never yield the benefits promised. Taxpayers end up footing the bill, he said.
The legislation will allow the cannibalization of current sales tax revenue, Lewis argued. He also questioned claims that bondholders are the only individuals on the hook if a stadium project fails and said a default could place the state’s credit rating at risk.
“Can you imagine the political pressure that would occur … if the bondholders are not being paid?” Lewis said.
Some lawmakers have also questioned whether the Chiefs or the Royals would be able to secure STAR bond financing and then layer on additional economic development incentives. One program mentioned multiple times was PEAK, which allows some out-of-state businesses that relocate into Kansas to retain 95% of payroll withholding taxes for new jobs created.
“We don’t have all the details of this,” said Rep. Henry Helgerson, a Wichita Democrat.
Helgerson said on the House floor that Kelly had used interest from federal pandemic dollars to aid the renovation of football practice facilities at Washburn University. He suggested the facility could be used for Chiefs training.
Tarwater responded that the new practice facility “also could be used at some point to relocate the Chiefs training camp form St. Joseph, Missouri. That was just a byproduct of it.”
A spokesperson for Kelly didn’t immediately respond to a request for comment.
The location of practice and training camp facilities is key because the bill allows STAR bond districts to be drawn around any team facility, not just the stadium itself. If the Chiefs move their training facility to Washburn, it could result in a STAR bound district in areas of central Topeka.
Cities and the counties would have the option to pledge local tax revenue from inside the STAR bond district toward repaying bonds, but wouldn’t have to. But any local government that decides against pledging revenue would likely lose leverage during negotiations over the terms of a STAR bond agreement with one or both teams.
The bill authorizes the Kansas secretary of commerce, currently Lt. Gov. David Toland, to negotiate a STAR bond agreement. Any deal would have to be approved by the legislative Coordinating Council, which includes top House and Senate leaders from both parties. Republicans hold a 6-2 majority on the council.
While the LCC’s vote on an agreement would be public, it could deliberate privately. The proposal keeps reports filed on a STAR bond district confidential.
Supporters of the plan spoke about it in glowing terms, offering a generational, even “once in a lifetime” opportunity.
Rep. Pam Curtis, a Kansas City, Kansas, Democrat, said Wyandotte County residents over the past few weeks have gone from opposition to excitement. She urged lawmakers to acknowledge that they won’t have many details right now – such as an exact location and deal – but are setting up a framework for future negotiations.
Curtis said many Wyandotte County residents are exited excited about the prospect of one or both of the teams coming to the area.
“They are excited about this opportunity and definitely Wyandotte County would welcome these discussions and the opportunity to bring a professional sports team to Kansas,” Curtis said.
Sen. Rob Olson, an Olathe Republican, predicted that a new stadium would host a Super Bowl within a few years. Discussing the potential revenue the event would bring in, he called the proposal a “gold mine for Kansas.”
“We owe it to the Kansas City Chiefs if they want to come to Kansas,” Olson said.
