Kentucky State Senate Passes New Racing Regulation Bill

With the addition of online sports betting and the possibility of adding online casino gambling in the future, Kentucky's Horse Racing Commission has been under siege. It has been overwhelmed in its quest to manage the state's gambling regulatory environment. The solution? The Kentucky State Senate has passed a bill that would effectively create the Kentucky Horse Racing and Gaming Corporation:

About the Kentucky Horse Racing and Gaming Corporation

The model for the Kentucky Horse Racing and Gaming Corp is the Kentucky Lottery Corp, which was created by legislative fiat in 1989. While the Kentucky Lottery Corp has been charged with overseeing the state's lottery, the Kentucky Horse Racing and Gaming Corporation would be responsible for regulating all other forms of retail/and mobile gambling. That would include

• Pari-mutual betting (horse racing, greyhounds, etc.)


• Sports betting


• Historical horse racing machines


• Online casino gambling if passed

The bill that passed through the Senate was the brainchild of Senate Majority Leader Damon Thayer and House Speaker David Osborne, both affiliated with the GOP. They both feel change is needed as the sports betting industry grows. They also cited the vast popularity of the historical horse racing machines, which have generated hundreds of millions in betting revenue for racetracks, as another area of concern.

According to Thayer, the growing revenue created by race tracks and sports betting operators demands a higher level of scrutiny. He told the press in a press release:

“There’s a lot of money going through the racing commission now, and I think the appointees should go through the extra level of scrutiny that comes with Senate approval.”

About the New Regulatory Structure

For 3+ decades, the Kentucky Horse Racing Commission has been recognized as a cabinet agency. As such, commission members are appointed by the Governor. In the past, it has been a common practice for each new Governor to come in and appoint his own members. The primary issue with this process has been the difficulty the Commission has had with maintaining regulatory continuity. That's to be expected since members have different views of how the horse racing industry should be regulated.

With the new Kentucky Horse Racing and Gaming Corporation in place, the organization would be led by a Board of Directors, which would be selected by a vote of vested parties. According to Thayer, the initial Board of Directors would likely be made up of the current Commission members until a voting process could be initiated.

One of the biggest challenges that the Corporation would immediately have to address would be aligning the state's regulations with those put forth by the Horseracing Integrity and Safety Authority of HISA. HHISA is a private company that was created by the federal government to oversee the nation's horse racing industry as a whole. HISA deals with important issues like pre-race and post-race drug testing. In the future, the Corporation would need to work directly with HISA to strengthen the integrity of the horse racing industry as a whole.