Lawmakers in Kentucky, who have failed year after year in attempts to legalize casino gambling and place slot machines in the state’s storied racetracks, are moving to extract their fair share of revenue from instant racing machines that are already in place at two tracks and being considered by others.
Instant racing machines—created by AmTote, Inc. and Arkansas’ Oaklawn Park in 2000—are slot-style terminals that allow players to wager on previously run horse races based solely on handicapping information, and then watch video of the races to cheer on their horses. They have been placed at Kentucky Downs in Franklin and Ellis Park in Henderson, based on an 2010 executive order from Governor Steve Beshear authorizing the games.
Other tracks are either planning to place the machines or waiting until their legal status is cleared up. Last year, the Kentucky Supreme Court held that the Kentucky Horse Racing Commission can regulate the games, but declined to rule on their legality, sending a lawsuit from the conservative Family Foundation back to Franklin Circuit Court.
State Rep. David Osborne has introduced a bill that would allow the commission to charge annual licensing fees for instant racing machines. Under the measure, tracks would pay up to $100,000 annually in licensing fees, and machine vendors would pay $5,000.
“This basically gives the racing commission a framework under which to regulate something that they are being told that they have to regulate,” Osborne told cable news station CN2. “They don’t actually have a framework in place. If the Supreme Court comes in and rules that the game is illegal, then this will have no bearing at all. This just is a stopgap measure right now that says that as long as the racing commission is being asked and mandated to regulate (instant racing), this gives them the actual ability to mandate it and charge the fees to do so.”
Kentucky Downs currently has 390 instant racing terminals in operation, and Ellis Park has 125. The Red Mile in Lexington is currently building a $30 million historical racing parlor with 1,000 terminals, and Keeneland, also in Lexington, plans to open a new track in Corbin with instant racing machines by 2016.
The $28.8 million bet at Kentucky Downs in January was up 20.61 percent over January 2014. The nearly $4 million bet at Ellis Park in Henderson was up 78.1 percent. The two combined to handle $32.81 million.
Should Osborne’s bill pass, Kentucky Downs would actually get a break on instant racing taxes. Last year, the track paid around $120,000 in licensing fees.
