Kentucky racetracks and the Kentucky Horse Racing Commission presented oral arguments August 14 before the state Supreme Court over the legality of historical horse racing. Such machines resemble slot machines, but payouts are based on a parimutuel formula. Bets are determined by the outcome of previously run races.
The conservative Family Foundation filed suit claiming that because bettors wager on different events, they cannot be deemed pari-mutuel, thus they are not legal.
But the tracks and commission counter that state law permits carryover wagers like the Pick 6, and historical races are no different, according to Blood Horse.
Attorney Jay Ingle, who represents Kentucky Downs and Ellis Park, two tracks that offer historical racing, argued that Kentucky’s regulations on pari-mutuel wagering do not require patrons to place bets on the same events. His argument included the Pick 6 wager, where bettors have the chance to win a pool that was generated by bets on six previous races and did not pay out in full.
“(HHR wagering) is consistent with what goes on every day with big Pick 6 carryovers,” Ingle said.
The racing industry in the state has a lot riding on the Supreme Court’s decision because historical racing has increased purses since its approval in 2011. In fiscal year 2020 ending in June, bettors wagered more than $2.25 billion on historical racing games, which led to $15.6 million for the Kentucky Thoroughbred Development Fund and the resultant 27 percent purse growth between 2010 and 2019. Kentucky collected more than $33 million in excise tax revenue from the wagering last fiscal year, according to the state Public Protection Cabinet.
At Kentucky Downs, the machines have drawn people from across the border in Tennessee. Churchill Downs has aggressively tapped into historical racing as a revenue source. The case could put Kentucky tracks at a competitive disadvantage with tracks elsewhere if the Family Foundation prevails.
In 2014 the Kentucky Supreme Court ruled that the racing commission acted properly when it approved historical wagering. But the same decision opened the door for the Family Foundation to seek discovery in the lower courts.
Ingle made the case that the Supreme Court has decided the definition of pari-mutuel wagers as written, but the Family Foundation is pushing different elements to that definition that does not exist.
“What the Family Foundation is really doing here is trying to relitigate what this court was asked to do in 2014,” Ingle said.
Stan Cave, the attorney for the Family Foundation, countered that the court said in order to be pari-mutuel wagering, players have to be “betting among, against, or with each other on the same event or group of events.”
Kentucky Supreme Court Chief Justice John Minton Jr. claimed the decision belongs in the legislature not the courts.
“The General Assembly has been aware of the operation of historical horse racing machines for nine years now. It has been aware of this court’s opinion for six years,” Ingle said.
When the state refused to approve casino gaming, the tracks went to historical games. The games often show video of condensed horse races, according to the Associated Press.
