When it comes to online gaming, the state of Kentucky is one of the most oxymoronic states in the country. Despite being the hub of horse racing in the U. S. and profiting tremendously from betting on those races, the state’s leadership has prevented online casino gaming, sports betting and online poker from being opened in the state. It even went to the point of suing PokerStars for allowing people from the Bluegrass State to play on the site. Thus, the recent introduction of legislation to regulate and legalize a plethora of online gaming options comes as a big surprise.
In 2020, Kentucky State Representative Adam Koenig introduced legislation that would have legalized sports betting in the state. It passed through the committee he chairs, the Licensing, Occupations and Administrative Regulations Committee, unanimously, but it did not come to the floor of the Kentucky Legislature for consideration. Undaunted, Koenig has filed his bill once again, which is practically a photocopy of what he issued in 2020.
This bill is known as House Bill 241 and it would open the state of Kentucky for a variety of gaming options. Along with legalizing sports betting, it would also provide regulation for online poker and daily fantasy sports (DFS). Three different segments of the Kentucky government – the Kentucky Horse Racing Commission (sports betting), the Kentucky Public Protection Cabinet (DFS) and the Kentucky Lotter Corporation (online poker) – would oversee the activities, meaning that there wouldn’t have to be any more bureaucracy created for regulating the activities.
There would be a few licenses that would be available inside the state. Any of the state’s horse or harness racing tracks would be able to receive licenses and any venue with a 50,000-fan capacity could also take part. That would draw in not only such iconic venues as Churchill Downs (the home of the Kentucky Derby) and Keeneland (another famous horse racing venue), but it would also allow the Kentucky Speedway, up until this year a host of NASCAR racing, to participate.
Why would Kentucky be considering such actions? Every state that is located around them offers sports betting and the state’s coffers are missing out on the action. If it were to pass, however, there would be no action in the state until at least 2023.
Convoluted History on Gaming in Kentucky
Other than betting on the ponies, the state of Kentucky has been notoriously slow in coming to the table regarding any segment of online gaming. In 2010, the state filed a lawsuit against PokerStars for $290 million. The state, at that time, alleged that PokerStars was illegally offering their product to their fellow Kentuckians and that they had lost upwards of $300 million on the site.
In 2015, a judge ruled in favor of the state, ordering that PokerStars pay treble damages, which tripled what the judgement was. Instead of owing $290 million, now PokerStars was on the hook for $870 million, but they appealed the decision. In 2018 The Stars Group, which owned PokerStars at that time, won an appeal in the Kentucky court system, but the state chose to appeal the issue. That appeal was heard in December 2020 by the Kentucky Supreme Court, with that court ruling in favor of the state and upping what PokerStars owed to $1.3 billion.
All of this occurred while the current governor of Kentucky, Andy Beshear, ran on a platform that regulating and licensing online gaming operations could be a revenue booster for the state. Sports betting alone in the state of Kentucky would raise up to $22.5 million annually and, should the state also bring online poker and DFS into the mix, it could greatly increase that amount.
Odds of passage of House Bill 241 are iffy at best. Other legislators are slow to come to cosponsor the bill and, although there is some support from government retirees (who are looking to use the revenues for underfunded pensions), there doesn’t seem to be a rush to getting to the bill. There are also problems with COVID protocols, which have significantly slowed down the legislative process in the state. Thus, don’t expect Kentucky to join the ranks of the online gaming world anytime soon.