A bill legalizing sports betting passed through the Kentucky Senate late Thursday, just hours before the legislature adjourned, despite facing long odds in this year’s legislative session. The surprising 25-12 vote – the proposal required a minimum of 23 votes to pass – sends the legislation to the desk of Gov. Andy Beshear, a long-time legal sports wagering supporter who on Friday restated that he will sign the plan into law.
Under the bill, the Kentucky Speedway and the state’s horse racing tracks could pay a fee to operate sports betting, both in-person and on licensed websites and phone apps. Wagers placed at the tracks would have an excise tax of 9.75%, while online bets would have a rate of 12.25%. Tax revenue from sports betting will fund state employee pensions, and a small amount of money will also be set aside for a fund to help people with gambling addictions.
Kentucky’s nine horse racing tracks would be licensed as sports betting facilities for a $500,000 upfront fee and an annual renewal cost of $50,000. Participating tracks could contract with up to three service providers for sports wagering services, which would give Kentuckians as many as 27 sportsbook options. Service providers would have to pay $50,000 for an initial license and $10,000 a year to renew. The Kentucky Horse Racing Commission would regulate the market.
While the House passed a nearly identical bill in last year’s session, it eventually died in the Senate after failing to gain majority support within the socially conservative GOP caucus in that chamber. Many believed the legislation would face the same fate this time around, suggesting the bill was one Republican vote short, but momentum drove the plan to the finish line.
When signed by Beshear, Kentucky will become the 38th state to legalize sports betting, with the law going into effect in late June, reports Louisville Courier Journal. Senate Majority Floor Leader Damon Thayer said HB 551 would bring in an estimated $23 million in annual tax revenue and licensing fees, adding that Tennessee’s sports betting law brought in $68 million of revenue last year. However, some supporters suggest that the estimate is low.
“We are a sports-crazy state. And people want to be able to make a choice of their own free will to make a wager on a sports event — like almost all our surrounding states,” Thayer said, as per the cited source. “I look forward to Kentuckians being able to place their wagers right here in the commonwealth instead of traveling across state lines to spend their money in other states.”
For their part, opponents called sports betting a highly addictive form of gambling that would hurt Kentucky families. Referring to the revenue estimates, Republican Sen. Whitney Westerfield said during the debate: “Ask yourselves, how much money people of Kentucky have to lose before we get that?”
However, when it came to the final vote, the voices in favor of legalization were the ones that had their way. Thayer viewed the passage as an extension of Kentucky’s “time-honored tradition of betting on horse races.” For his part, the governor sees it as an opportunity to keep gambling dollars in the Bluegrass State.
After years of urging lawmakers to legalize sports betting, we finally did it! Today’s result shows that hard work pays off. 1/2
— Governor Andy Beshear (@GovAndyBeshear) March 30, 2023
“After years of urging lawmakers to legalize sports betting, we finally did it!” Beshear said on Twitter. “Today’s result shows that hard work pays off. Kentuckians will soon be able to place their bets here, and for the first time, we are going to keep those dollars to support our roads and bridges, schools and communities.”
The move to legalize sports betting also had the backing of the American Gaming Association. Just days ahead of the decisive vote, AGA President and CEO Bill Miller urged lawmakers to pass the legislation, calling it “an important opportunity” to adopt a legal, regulated sports wagering market that would help fund “critical initiatives.”