Kansas Star Successfully Appeals Property Tax Assessment, Casino Owed $19M

Posted on: December 13, 2023, 12:12h. 

Last updated on: December 13, 2023, 10:43h.

The Kansas Star Casino in Mulvane is due a refund of more than $19 million in property taxes after a state court recently ruled the resort overpaid in 2014.

Kansas Star Casino property taxes
The Kansas Star Casino is getting back $19 million in property taxes that it overpaid in 2014. The casino is owned and operated by Boyd Gaming, a Las Vegas gaming company specializing in regional casinos. (Image: Boyd Gaming)

Owned and operated by Boyd Gaming, the casino has been appealing its assessed property valuation annually since 2014.

The Sumner County Assessor assessed the destination casino at a value of $225 million when it opened in 2012. That was reduced to $175 million following an appeal from Boyd Gaming, but the Las Vegas-based casino operator said the valuation was still far too high.

Boyd has maintained that the land-based casino is worth approximately $75 million. The company has engaged in legal challenges each year since 2014, alleging its property taxes are too high because of the over-assessed value.

Tax Disputes

The property tax disputes have been costly for the county and Mulvane, which sought to remedy the matter this year by settling with the casino. A resolution was reached this week, according to Sumner News Now and NBC Wichita, that will result in the casino being returned more than $19 million.

It’s a positive in that we know what to expect. Instead of waiting for a judgment to come out, we know what we’re paying,” said Austin St. John, the city manager of Mulvane. “We know for the next five years … our valuation is going to be correct.”

The Kansas Star Casino has 1,300 slot machines, 43 table games, and a FanDuel Sportsbook. An on-site Hampton Inn & Suites hotel offers 300 guestrooms. The resort includes three full-service restaurants and the 3,400-seat Kansas Star Arena.

Property Tax Settlement

During the annual appeals of its property tax responsibility, the Kansas Board of Tax Appeals has regularly split the two sides’ claimed values. The state agency recently said the Kansas Star is worth about $102 million. But since the casino has paid the full tax based on the county’s $175 million assessment, back taxes are due.

Sumner County Commissioners and Mulvane officials agreed to keep the casino’s assessment at $102 million for 2023 and at least the next four years. The county and city will return approximately $19 million to Boyd Gaming over the next four years. Sumner County, the City of Mulvane, and the Mulvane School District will split the tax return.

In exchange for the resolution, Boyd has agreed not to assess interest on the $19 million, which would have significantly increased the return since it dates back seven years. Boyd has also agreed to forfeit its right to appeal the $102 million assessment during the four-year agreement.

Casino Taxes

Along with its property tax, the Kansas Star Casino pays sales and gaming taxes, with the latter providing important tax streams to the state and local governments.

In October, the casino reported gross gaming revenue (GGR) of $12.8 million. The county collects 3%, which totaled about $386,300. The state received 22%, which was $2.8 million in October.

The state’s problem gambling fund is marked 2%, and the casino retains 73%.