Historical horse racing is alive again in Kentucky!
Thousands of industry employees can breathe a sigh of relief today.
The state Senate passed a bill Tuesday, Feb. 9 to legalize long-debated historical horse racing (HHR) machines.
The bill then traveled to the House, where it passed by a 55-38 margin on Thursday, Feb. 11.
HHR gets a thumbs up from the Kentucky Senate and House
Although HHR machines resemble slots, they have operated within a legal gray area for the past decade, serving as a major revenue source for Kentucky’s horse industry.
Last year, the Kentucky Supreme Court determined that the HHR machines in question did not fall under the same umbrella as pari-mutuel wagering and were thus illegal.
Pari-mutuel wagering allows players to make bets among themselves rather than against the house.
For these specific HHR machines, players do not bet against other players at the same time and on the same race. Therefore, the court ruled them to nto fall under the definition of pari-mutuel wagering.
As a result, facilities have been forced to shut down and put a temporary stop to all HHR-related activity.
Lawmakers were tasked with revising the legal definition of pari-mutuel wagering to include HHR if the machines were to continue being used.
Senate Bill 120 does exactly that.
SB 120, which alters the state’s definition of pari-mutuel wagering to include the long-debated HHR machines, passed in the Senate with bi-partisan approval by a vote of 22-15.
Surprisingly, senators and representatives that have traditionally been opponents of gambling, as well as those in jurisdictions without racetracks, even joined in on the “yea” voting.
HHR Senate supporters cite various reasons for approval
Sen. John Schickel, the bill’s primary sponsor, sees HHR machines as a lifeline for race tracks and their employees, saying they “support real jobs that support real families”.
Similarly, Sen. Phillip Wheeler, (R-Pikeville), said his vote of approval did not necessarily mean he endorsed gambling expansion. Rather, Wheeler voted “yea” in the best interest of the horse racing industry and the countless jobs tied to it.
HHR machines protect the jobs of thousands of Kentucky residents.
Moreover, HHR’s revenue stream contributes a substantial amount to racing purses and fortifies the state’s renowned year-round racing circuit.
Senate Floor Majority Leader Sen. Damon Thayer, (R-Georgetown), is a longtime proponent of thoroughbred racing and breeding. He noted that the inclusion of HHR machines has reduced requests for further gambling expansion through casinos, concluding:
“If you don’t like casino gambling, you should be for historical horse racing.”
HHR opponents questioned SB 120’s constitutional validity
Those that voted no on the bill argue that HHR machines can only be legalized through a constitutional amendment. This would require a statewide referendum.
Sen. Whitney Westerfield, (R-Crofton), called the bill unconstitutional, believing that gambling “in all its forms is predatory and bad public policy.”
He held firm to his stance that state government should not “get in bed with an industry that requires its people to lose for the industry to succeed,” noting that gambling “preys on the poor, on those hoping, wishing their next play is the one that makes it big.”
Kentucky HHR sees the light at the end of the tunnel
HHR machines have been left dangling in Kentucky’s legal limbo for more than four months now.
Tuesday’s Senate approval was certainly another major step in the right direction. The cherry on top was Thursday’s thumbs up from the House.
Attempts to amend the HHR bill fell short during Thursday’s assembly.
J. DuPlessis introduced Amendment 6, which would increase the excise tax on historical horse racing from 1.5% to 3.5%. The amendment was ultimately ruled out of order and was therefore not voted on, since the bill began in the Senate. Many House members spoke out against the tax rate and pushed the legislature to take action in 2022 to adjust
A bevy of moral objections to legalizing HHR came from opponents.
Rep. David Hale, R-Wellington, went to great lengths to share his opposition to the bill.
“I don’t think this is about the jobs. I think it is about greed from a greedy industry and a greedy corporation.”
Rep. Shane Baker, R-Somerset, says HHR facilities should have taken it upon themselves to upgrade their machines to conform with September’s Supreme Court ruling.
“They just want us to give a definition, to permit them to continue . . . They could have found a fix, in my mind.”
Rep. Ryan Dotson said that his position serving as a pastor has shown him the “underbelly of society”, such as the families who can’t afford to put food on the table because parents gambled their income away.
Rep. Ken Fleming, on the other hand, said he also sees the “underbelly of society” in the west end of Louisville, where the jobs and livelihood of countless Kentucky residents are at stake if the bill fails.
HHR bill receives Gov. Beshear’s signature
In the end, the concern about the health of the horse industry and a desire not to eliminate existing jobs in the middle of the pandemic prevailed. The next stop for the legislation was Gov. Andy Beshear’s desk. Beshear supported the HHR legislation and officially signed the bill into law on Feb. 23.
If you are wondering what this might mean for the possibility of Kentucky sports betting, don’t assume it now has a clear path. Unlike HHR, which already employs thousands of people, sports betting would only possibly create a few new jobs, so the cover HHR supporters had for voting in favor of the bill for the sake of the economy will not be as effective.
Moreover, many representatives reconciled that approving a practice that was already taking place in Kentucky didn’t count as voting to expand gambling. Obviously, that argument is out the window when it comes to legalizing sportsbooks. For a state that is still clearly very divided on gambling, this bill might be the only step the legislation is willing to take this legislative session.
