Draft plan says Kansas would finance up to 75% of Chiefs, Royals stadium costs

Kansas will finance up to 75% of the cost of new stadiums for the Kansas City Chiefs and Royals – an amount that could total billions in bonds – in an effort to attract the Missouri teams, a draft proposal says.

The Legislature will consider the plan at a special session that begins Tuesday, but lawmakers will hold a hearing Monday. The proposed bill isn’t final and could be amended, but a draft of it was circulating within the Kansas Capitol on Monday.

The proposal would give top lawmakers the power to approve or reject any stadium proposal. Any stadium project would need to be approved by June 30, 2025, but top lawmakers could postpone that deadline by a year.

While some of the details of the plan were already public, the proposal makes clear how far Kansas lawmakers are willing to go to lure one or both teams after Jackson County voters rejected a stadiums sales tax in April that would have guaranteed the teams stayed in Missouri.

The plan has divided lawmakers, with support and opposition crossing party lines. Some Republicans and Democrats have assailed the plan as corporate welfare, while supporters have cast it as a generational opportunity for the state.

“Make no mistake, this is a subsidy to billionaires,” Sen. Tom Holland, a Baldwin City Democrat, told reporters last week.

House Speaker Dan Hawkins, a Wichita Republican, and Senate President Ty Masterson, an Andover Republican, kicked off the current push for the teams when they sent a letter to the Chiefs earlier this month inviting the team to weigh in on the proposal. It isn’t clear whether the team will provide official testimony at Monday’s hearing.

Under the plan, Kansas would issue Sales Tax and Revenue, or STAR, bonds to cover up to 75% of project costs. Current law limits STAR bonds projects to 50% of costs.

The bonds are backed only by future sales tax revenue within a district that covers a stadium and surrounding developments, and some experts on stadium economics have voiced grave doubts about whether such a district could generate enough taxes to cover what the legislation says would be 30-year bonds.

Supporters of the plan have largely dismissed those concerns.

“When you’re dealing with organizations like this, the risk is very limited. They’re good partners, good players, good investments,” said Rep. Jesse Borjon, a Topeka Republican who sits on the House Commerce, Labor and Economic Development Committee.

The proposal also pledges revenue from a fund aimed at attracting professional sports teams toward repaying the bonds. That fund, created in 2022 when lawmakers legalized sports betting, contains most of the sports betting revenue coming into the state.

The Legislature this spring also placed a provision in the state budget directing excess Lottery revenue above $71.5 million a year into the fund. The proposal before lawmakers would make that change permanent, potentially adding roughly $10 million a year or more into the fund.

While the fund currently has about $4 million in it, some lawmakers project that with betting and Lottery revenues, the annual revenues into it could eventually total $25 million or more – effectively a dedicated funding source for paying off the STAR bonds. Lawmakers could also vote to direct more revenue from the Lottery into the fund in the future.

Local governments would be allowed, but not required, to pledge local sales tax revenue from inside the district toward the bonds.

The proposal allows cities and counties to issue STAR bonds, as happens under current law, but would also allow the state itself – through the Kansas Development Finance Authority – to issue the bonds.

The Kansas secretary of commerce, currently Lt. Gov. David Toland, would be authorized to negotiate a stadium agreement. But 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.

The Star’s Jenna Barackman contributed reporting