KY Supreme Court to Rule on Legality of Historical Horse Racing Machines

Posted on August 18, 2020 - Last Updated on August 24, 2020

Slot machines aren’t legal in Kentucky, but historical horse racing (HHR) machines are.

HHR machines superficially resemble slots, and non-players might consider them identical. But by inviting players to handicap historical races and employing a pari-mutuel wagering model, the HHR machines have been ruled legal by Kentucky courts in the past.

That being said, some gambling opponents still aren’t convinced. One such group, the conservative faith-based Family Foundation, has been fighting that battle for years. The fight will reach a climax later this week when it is considered by the Kentucky Supreme Court.

It’s not the first time the state’s highest court has ruled on the matter. But many, including the state’s governor, are hoping it will be the last.

A decade of KY historical horse racing… and of legal battles

The historical horse racing concept dates back to the late 1990s. Also called “instant racing,” the first machines appeared in Arkansas and a couple of other states during the early 2000s.

In 2010, the Kentucky Horse Racing Commission obtained court approval to alter the state’s pari-mutuel wagering law to allow HHR machines. The first ones came to Kentucky Downs in Franklin the following year. Other venues started adding machines shortly thereafter.

Gambling opponents soon filed an appeal against the court ruling. In 2014, the Kentucky Supreme Court ruled the state’s commission had the authority to license and regulate historical horse racing.

Another circuit court ruling in 2018 again confirmed the legality of the machines.

The Family Foundation appealed that ruling, and it is their appeal the state’s Supreme Court will be taking up on Friday.

Group wants current machines gone, future ones prevented

The Family Foundation aims to have the HHR games shut down at each of the state’s four gaming venues:

  • Kentucky Downs
  • Derby City Gaming (Louisville)
  • The Red Mile (Lexington)
  • Ellis Park Race Course (Henderson)

The group also hopes a ruling against the HHR machines will stop the expansion of these venues and the opening of new ones.

Churchill Downs owns Derby City, home of approximately 1,000 HHR machines. In June, the company announced plans to purchase 1,250 new historical horse racing machines from IGT.

Some of the new machines will go to Derby City. Others will go to Oak City Racing and Newport Racing.

The company has plans to open new venues as well, including one near the Tennessee border.

In a joint venture with the Keeneland Assocation (which owns The Red Mile), Churchill Downs will soon be opening Oak Grove Racing & Gaming.

Located about an hour north of Nashville, the site hosted its first harness races last fall, even as construction continued on the rest of the venue.

Oak Grove’s grand opening will be in mid-October, according to the current schedule. A new historical horse racing machine facility will be among the new attractions.

Expansion and growth increases historical horse racing’s profile

Kentucky Downs also has plans to expand its historical horse racing offerings. We spoke last week with Director of Marketing John Wholihan about the property’s unveiling of a new expansion in September.

The expansion will eventually include increasing the number of HHR machines to 1,100 or 1,200.

As Wholihan explains, manufacturers like IGT and others new to historical horse racing are getting involved with creating games on the pari-mutuel model. That development provides venues more options and a greater variety of HHR games.

Wholihan mentioned Jersey City Racing as one of the venues with the most HHR machines currently, along with Kentucky Downs. Most facilities have licenses allowing them to have more machines than they currently do. However, there is an optimal number of machines based on physical space and typical crowd sizes.

Crowd sizes are of course affected currently by COVID-related restrictions.

The Family Foundation points to such growth as increasing the urgency to shut down historical horse racing machines. The industry certainly has been trending upward in a significant way.

Bettors wagered more than $2.2 billion on HHR machines in Kentucky during the fiscal year ending June 30.

That total represents an 11% increase over the previous year’s handle of $2.03 billion. That increase comes despite facilities’ closure for three months due to the coronavirus pandemic.

In 2015, less than 700 machines were operating, with about $373 million wagered on them. At present, there are approximately 3,000 HHR machines, with more coming.

KY Governor wants historical horse racing ruled constitutional

Some of the new machines arrived after the 2018 circuit court ruling, meaning the appeal seeks to shut down machines not covered by the original ruling. That’s one of a few arguments brought up by those who believe the Supreme Court should rule in the venues’ favor.

Meanwhile Kentucky Gov. Andy Beshear points to the positives historical horse racing has brought the state.

Beshear notes that HHR machines have helped support the race tracks by increasing purses. He also notes the tax revenue they have produced which he says has “allowed us to be competitive with some other states” that have legalized gambling.

“I think as a state, we need it to be ruled constitutional,” said Beshear.

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Martin Harris

Martin Harris is a writer and teacher who has reported on poker, online gambling, and sports betting since the mid-2000s. Once a full-time academic (Ph.D., English), he currently teaches part-time in the American Studies program at UNC Charlotte. His book Poker & Pop Culture was published by D&B Books in 2019.

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