Horse Racing Sector in Kentucky May Finally Get Some Answers Regarding Its Key Funding Source

Some long-awaited answers regarding the horse industry’s off-site gambling terminals could be provided by the end of the week, as a vote on the matter is set to be held in Frankfort.

Now, everyone in the horse racing sector is anxiously waiting to see further development on the matter. Supporters of the horse racing sector are also strengthening their efforts, with Turfway Park planning to host some talks with trainers, jockeys and other people related to the industry about the expected impact of the changes.

In September 2020, the Supreme Court of Kentucky ruled that the key funding source of the state’s horse racing industry – the so-called historical horse racing machines – was not in line with the Constitution. The ruling was found shocking by many supporters of this form of gambling, especially by the ones who had been expecting to see the potential positive financial impact of the machines on struggling racing tracks, such as Turfway Park.

The horse racing terminals, which are basically slot machines and provide customers with the chance to place wagers on the results of old horse races, have not been available in Northern Kentucky until recently. Some operators, however, saw the machines as a chance for them to generate more revenue.

Late in 2020, Newport Gaming & Racing placed 500 of the machines and created over 70 full-time jobs, with Turfway Park’s average betting pool per day increasing by 65%. The track’s new owners expressed their willingness to place even more machines at the track after its renovation is finalized.

Historical Horse Racing Machines Are Not the Same as Slot Machines

As mentioned above, the historical horse racing machines look like regular slot machines. However, they are not exactly the same thing, because they offer customers the chance to bet on the old horse races’ outcome, in which the winner is already known. What is interesting, is the fact that players do not have an advantage even with the outcome of the races already clear because the horses are being selected at random by the machine, and the place of the pre-recorded races is not unveiled until after a player makes their bet.

Owners of local horse racing tracks, however, are particularly fond of the machines because they help them increase their purses, which on the other hand, could attract more jockeys, more customers and generate bigger profit.

Last September, the Kentucky Supreme Court issued a ruling declaring the terminals as unconstitutional because they were not in line with the legislative pari-mutuel requirement. According to the ruling of the state’s Supreme Court, the local regulatory body – the Kentucky Horse Racing Commission – exceeded its authority when giving them the green light.

In order to take part in so-called pari-mutuel betting, the pool is gathered by all participants’ bets, and the pot is being split among the winning bets.

Now, if the state of Kentucky wants to have the historical horse racing terminals, the local legislature would have to bring some changes to the law. There have been some steps in this direction, as state Senator John Schickel filed a bill seeking to change the definition of “pari-mutuel” in order to have the machines permitted. However, at the time, a local non-profit organization shared some concern that the piece of legislation would result in further litigation and was practically unable to bring the desired constitutional amendment under which the machines would be legal.

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