Kentucky Inching Closer to Sports Betting Launch

There was great joy in the state of Kentucky when Governor Andy Beshear signed HB 551 into law in March 2023. HB 551 is the state's robust sports betting legislation, something that Kentucky residents have been waiting for most of their lives. The Senate passed the bill by a vote of 25-12 before securing Gov. Beshear's signature.

At the time, certain guidelines were already put in place. For instance, the bill stated:

• The Kentucky Horse Racing Commission (KHRC) would oversee the state's sports betting activities
  
• Residents would have access to retail and online sports betting options
  
• The effective tax rate on online/mobile bets was set at 14.25%
  
• The effective tax rate on retail bets at race tracks was set at 9.75%
  
• Licensing application fees were set at $500,000 for retail facilities, to be followed by annual fees of $50,000
  
• Each Race Track/retail operator will be allowed three (3) sports betting skins
  

What the bill didn't address was some of the administrative tasks that would need to be handled before setting a sports betting launch date.

KHRC Takes Major Step Toward a Sports Betting Launch

Since the signing of HB 551, the KHRC has been working diligently, trying to assemble the rules and regulations by which Kentucky's sports betting community will be ruled. It's been a time-consuming task, but Commission officials have announced they have a draft that is ready for review.

Given the amount of work that has gone into the rule development process to date, the hopes are high that the review process is nothing more than a formality. If by chance the rules get the Commission's green light on Monday, July 10, 2023, there is an excellent chance that the state's sports betting launch might occur prior to the start of the NFL's 2023-2034 regular season in September.

Approving the rules would set the stage for the commission to start accepting license applications. At this point, it is reasonable to expect that many of America's top sports betting are already chomping at the bit to start submitting applications. It's more or less a "canned process" through which most of the top operators have already been through many times.

Assuming the Commission will have all of its ducks in order, the application approval process should run smoothly since most prospective operators have already established their reputations and processes. If for any reason the KHRC would need to delay the licensing process, it would make it very unlikely that Kentucky residents would be wagering by the start of the college and NFL football seasons. The bottom line is this: there are still a lot of T's that need to be crossed and I's that need to be dotted before the sports betting light shines green.

It's worth noting that the future of other forms of online gambling will be hanging in the balance. If everything goes well with the sports betting launch, it would increase the likelihood of legislation directed at online poker and casino gambling getting exposure.