Democratic co-sponsor of casino bill is employed by horse racetrack co-owner

jcheves@herald-leader.comFebruary 14, 2012 

Kentucky Senate

Senate Minority Floor Leader R.J. Palmer, D-Winchester, watches the tote board prior to a vote on a bill during the legislative session in Frankfort, Ky., Friday, Jan. 7, 2011. (AP Photo/Ed Reinke)


Much of the responsibility for passing Gov. Steve Beshear's casino gambling bill will fall on Senate Democratic Floor Leader R.J. Palmer, who is co-sponsoring the proposal and hopes to deliver all 15 votes from his Democratic caucus.

The bill is a proposed constitutional amendment that — if voters approve in November — would allow casinos at five Kentucky horse racetracks, plus two freestanding locations.

It also could make Palmer's employer even wealthier.

Palmer, of Winchester, is a banker at Ross, Sinclaire & Associates, which sells bonds for government projects. Murray Sinclaire, the firm's chief executive officer and president, co-owns Thunder Ridge Raceway, a harness track near Prestonsburg that could be eligible to apply for a casino license if expanded gambling is approved.

In 2009, Palmer cited a conflict of interest and abstained from voting on a bill that would have authorized casino gambling at tracks. But this year's measure is different because it's less direct, putting the decision in voters' hands by way of a public referendum, Palmer said Tuesday.

"This legislation guarantees no track anything," said Palmer, who plans to vote for the measure. "This is simply a constitutional amendment that will allow the people of Kentucky to decide whether they want to move forward on this issue."

Sinclaire, who lives and works in Cincinnati, did not return calls Tuesday seeking comment. Palmer said he and Sinclaire never have discussed the potential for a casino at Thunder Ridge.

Ivan Zabilka, president of Citizens Against Gambling Expansion, said the corrupting power of gambling money is so great that no lawmakers should be involved with the casino bill if their private jobs are connected to tracks or the horse industry, which stands to make hundreds of millions of dollars from casinos.

"It's obviously a conflict of interest for Mr. Palmer," said Zabilka, a retired educator in Wilmore who has published books and articles critical of gambling. "I wouldn't want a lawmaker who is employed by Humana to go anywhere near legislation that was sought by Humana because of its benefits for the insurance industry. It's a disappointment when you see this sort of thing happen in Frankfort."

Gambling opponents also have questioned the ethics of Republican Sen. Damon Thayer of Georgetown, the primary sponsor of Beshear's gambling bill. The Rev. Hershael York of Buck Run Baptist Church in Frankfort has said it is unethical for Thayer to sponsor the casino bill while he's paid as a marketing consultant by horse industry clients.

After initially declining to name his clients, Thayer said last week that he provides marketing and public relations services to Kentucky Speedway in Sparta, Millennium Farms in Lexington, Wintergreen Stallion Station in Midway and Whispering Oaks Farm in Carencro, La.

Thayer said none of his clients would benefit from a referendum on casino gambling. He also obtained an informal opinion from the Legislative Ethics Commission that said he would not have to recuse himself from involvement with the casino bill.

In 2008, Palmer requested an opinion from the Legislative Ethics Opinion on whether he could participate in casino gambling legislation given his employer's track ownership.

The ethics commission cleared him to vote on a constitutional amendment so long as it did not exclusively benefit his employer, he said.

"If the legislation has a similar effect on all facilities forming the class which might become eligible to offer casino gaming, a legislator who is an employee of such a facility may sponsor or support legislation relating to gaming or a proposed constitutional amendment to allow gaming," the ethics commission wrote. "However, if the legislation applies only to the facility that is the legislator's employer, then the legislator should abstain from voting and disclose his interest."

Rep. Bob Damron, D-Nicholasville, abstained from voting in the House on the 2009 casino bill, just as Palmer did in the Senate, and for the same reason: At the time, Damron worked for Ross, Sinclaire.

Damron said he believes Palmer is on ethically safe ground co-sponsoring a constitutional amendment that does not guarantee anything to Thunder Ridge. Damron said he's never heard Sinclaire mention casinos, although he assumes that's what made the remote track attractive to the late Terrell Ross, Sinclaire's former business partner. Ross died in 2006.

"Terrell was the one who wanted to buy the track, and Mr. Sinclaire went along with him," Damron said. "I think Terrell always thought over the years that there would be slots there at some point. I doubt the thing has ever made any money to speak of."

Sen. Julian Carroll, D-Frankfort, a Democratic governor in the 1970s, also is a former co-owner of Thunder Ridge. Carroll said he acquired an ownership stake by doing more than $100,000 in legal work for the track. But Carroll said Tuesday that he and the track parted ways "years ago."

Thunder Ridge was Kentucky's smallest track in 2010 in terms of money bet on live racing, according to data reported to the Kentucky Horse Racing Commission. A recent study prepared for the racing industry estimated that Thunder Ridge could generate $32.8 million in gross gambling revenues in the year 2015 with casino gambling. That was far less than the gambling revenue projected for the state's seven other tracks.

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