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Friday, February 12, 2021

Historical Horse Racing Bill Passes House, Moves to Governor’s Desk

An end may come soon to the debate over historical horse racing machines and what is known as pari-mutual wagering as a bill moves forward to the governor's desk.

After passing the Kentucky House of Representatives with a vote of 55-38 on Wednesday, a bill on historical racing machines is now headed to Governor Andy Beshear’s desk. The bill, SB 120, passed the Senate with a 22 to 15 vote on Tuesday. 

The issue of historical horse racing machines came to the forefront following the Kentucky Supreme Court’s September ruling that certain historical horse racing games, which many say resemble casino slots, are unlawful.

Kentucky’s horse racing tracks have relied on these machines as a major source of revenue. The industry came to the Kentucky General Assembly for help following the ruling, saying the horse racing industry in the Commonwealth would be in jeopardy if lawmakers did not do something. 

 RELATED: Kentucky Senate Passes Legislative Fix for Slot-Like Gambling


Support from legislators highlights jobs and revenue

SB 120 is described by supporters as a continuation of a practice that has already been happening in Kentucky for a decade and that historical horse racing is needed in order for Kentucky’s horse racing industry to survive.

"Obviously, there’s a lot at stake," said Rep. Adam Koenig, R-Erlanger, on the House floor. "We’ve all heard the numbers. (Horse racing) is a $5 billion a year industry."

Rep. Matthew Koch, R-Paris, also supported the bill. Koch described SB 120 as a bill about jobs. He cited the hundreds of jobs already lost and the thousands more that could be lost if the House did not pass SB 120.

"While Kentucky is the best place to raise a horse, it is not the only place to raise a horse, and we have to fight to keep that here," Koch said.

Rep. Mary Lou Mazian, D-Louisville, stated that she does have issues with SB 120 and how she’s concerned that the prospect of increasing the tax rate on historical horse racing machines, as some lawmakers favor, might slip through the cracks. She ultimately voted in favor of the legislation. 


Opposed say it could come back to hurt the horse racing industry

Yet, some lawmakers said they believe the bill is unconstitutional and have sided with organizations such as The Family Foundation who believe gambling is predatory and harmful to Kentuckians.

"Senate Bill 120 is about saving slot machines," Rep. Chris Fugate, R-Chavies, said. “… There’s a lot of families in America that’s been torn apart because of gambling.”

Martin Cothran, spokesperson for The Family Foundation, issued a statement that, while the horse racing industry won the issue, the effect may be that mechanized gambling will push out in-person racing.

"The horse industry won today, but will lose in the future as mechanized gambling eventually pushes it out, and the state loses because it gets a pittance from these machines and supporters of this bill refused to raise the tax rate," he said.

"The Kentucky horse industry will rue the day it made common cause with its own competition...We have said all along that this bill would not save the horse industry, but would replace it. Horses are fast, but mechanized gambling is faster and more profitable...This was a Pyrrhic victory for the horse industry, a win that looks like a win, but is really a loss. It's a sad day for the horse industry."

Historical Horse Racing Facilities Await Final Go Ahead

Legislation to address the tax issue raised by lawmakers during the House floor debate has already been filed and could be further considered this legislative session.

SB 120 contains an emergency clause, meaning it would become effective immediately upon the governor’s signature rather than 90 days after adjournment of the legislature.

The bill would have a direct effect on Newport Racing and Gaming. Some facilities, such as Keeneland's Red Mile HHR facility in Lexington shut down after the Kentucky Supreme Court decision, while the Newport facility has remained open as the bill moves through the legislative process.

RELATED: Will Kentucky Supreme Court Decision Affect Newport Historical Racing Facility? 

Historical Horse Racing facilities are ready for the decision.


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