Kentucky Sports Betting Bill Advances with Strong Backing

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A Kentucky House committee unanimously approved a stronger and improved online and retail sports betting bill Wednesday, the crucial first step to legal wagering in the commonwealth. It came a day after Gov. Andy Beshear touted sports gambling as a possible revenue source during his first State of the Commonwealth address.

Key hurdles remain, but the lopsided, bipartisan vote in the House Licensing and Occupations Committee gives it momentum heading to more pivotal votes in the coming weeks.

Sports betting supporters in Lexington tried to push wagering in the 2018 and 2019 sessions and many of those same forces that tanked those bills, largely conservative and religious groups opposed to gambling in all forms, remain in the statehouse.

That hasn't stopped backers' optimism for a breakthrough in 2020. As well as a new gubernatorial administration, Kentucky will see two neighboring online sports betting markets in Illinois and Tennessee begin in 2020. Elected officials in Kentucky, one of the few remaining states without any casinos, have used this threat of even more gaming dollars crossing state lines as another key factor in what has been an uphill climb for legal wagering.

First Vote Details

The latest bill couldn’t ask for a much better start.

Unanimous Vote : HB 137 began on favorable turf in the Licensing and Occupation, which is chaired by its sponsor, Republican Rep. Adam Koenig. Like last year, Koenig’s bill advanced without opposition, even with several new members in this session’s committee. Democrat Alan Gentry stumped for the bill before the vote, underscoring its bipartisan support.

: HB 137 began on favorable turf in the Licensing and Occupation, which is chaired by its sponsor, Republican Rep. Adam Koenig. Like last year, Koenig’s bill advanced without opposition, even with several new members in this session’s committee. Democrat Alan Gentry stumped for the bill before the vote, underscoring its bipartisan support. Governors Support : Beshear, a Democrat, lauded the legislation during his first State of the Commonwealth address. His predecessor, Republican Matt Bevin, vehemently opposed gambling during his four years in office.

: Beshear, a Democrat, lauded the legislation during his first State of the Commonwealth address. His predecessor, Republican Matt Bevin, vehemently opposed gambling during his four years in office. Next Steps : The bill is set to go to the House rules committee, which includes the leaders of both caucuses and sets the trajectory of all legislation in the General Assembly. Senate Majority Leader Damon Thayer supports the bill, and it should advance in the coming weeks to the full House floor without many hiccups.

: The bill is set to go to the House rules committee, which includes the leaders of both caucuses and sets the trajectory of all legislation in the General Assembly. Senate Majority Leader Damon Thayer supports the bill, and it should advance in the coming weeks to the full House floor without many hiccups. Key Fact: Koenig’s 2019 bill didn’t pass committee until mid-February. Practically, this year’s legislation has an extra month to work within the state’s four-month legislation term. Less tangibly, it underscores the increased momentum for the 2020 incarnation.

Bill Details

Lawmakers also unanimously changed several key components of the 2020 bill.

In-State College Betting : If passed, Kentuckians could wager on in-state collegiate sporting events, including on popular programs such as Kentucky and Louisville. Koenig said before Wednesday’s vote it was the most criticized component of the 2019 bill.

: If passed, Kentuckians could wager on in-state collegiate sporting events, including on popular programs such as Kentucky and Louisville. Koenig said before Wednesday’s vote it was the most criticized component of the 2019 bill. Skins Defined : Koenig also updated the bill to specify that each eligible land-based gaming facility was allowed one online license or “skin.” The legislation effectively limits the eligible facilities list to a handful of race tracks with more than 50,000 seats, which includes the iconic Churchill Downs, home of the Kentucky Derby. Kentucky Speedway, which hosts NASCAR and Indy races, would also qualify to operate a sportsbook.

: Koenig also updated the bill to specify that each eligible land-based gaming facility was allowed one online license or “skin.” The legislation effectively limits the eligible facilities list to a handful of race tracks with more than 50,000 seats, which includes the iconic Churchill Downs, home of the Kentucky Derby. Kentucky Speedway, which hosts NASCAR and Indy races, would also qualify to operate a sportsbook. Registration Sunsets : The new bill also “sunsets” the in-person registration for online wagering on Jan. 1, 2022. In-person registration is seen by proponents as a way to draw foot traffic to brick-and-mortar gaming facilities, but has stunted online sports wagering markets in other markets, most notably Rhode Island.

: The new bill also “sunsets” the in-person registration for online wagering on Jan. 1, 2022. In-person registration is seen by proponents as a way to draw foot traffic to brick-and-mortar gaming facilities, but has stunted online sports wagering markets in other markets, most notably Rhode Island. Tax Rates : In-person sports bets will be taxed at 10.25% and online bets at 14.25%, rates which Koenig acknowledged Wednesday were slightly above the national average but he said were low enough to keep operators interested in Kentucky and the overall market viable.

: In-person sports bets will be taxed at 10.25% and online bets at 14.25%, rates which Koenig acknowledged Wednesday were slightly above the national average but he said were low enough to keep operators interested in Kentucky and the overall market viable. Poker: The legislation would also make Kentucky just the sixth state (behind New Jersey, Nevada, Pennsylvania, Delaware, Michigan and neighboring West Virginia) to legalize real money online poker.

Work Remains

Today’s unanimous vote, the revised language in the bill, the increasing regional competition for sports betting dollars and the explicit support of the governor may still not be enough to push sports betting into law.