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Slots bill headed for back burner

FRANKFORT — Legislation to allow electronic slots at racetracks will probably pass out of one committee Thursday morning only to go right back on the shelf in another, possibly ending gambling drama for another session.

House Licensing and Occupations Committee chairman Rep. Dennis Keene, D-Wilder, said his panel will meet at 9 a.m. to take up House Speaker Greg Stumbo's bill to allow video lottery terminals under the authority of the state's lottery board.

But Stumbo, D-Prestonsburg, said late Wednesday that the bill will then go to House Appropriations and Revenue, and he doesn't expect that it will be called up again this session.

"It still needs to be vetted some," Stumbo said of the slots bill. "I don't think the support level is here right now."

But Stumbo said he expects the slots bill to be "part of the debate" of how to restructure Kentucky government's revenue. He said that he's heard increasing interest from members but that the measure will need more time for legislative ripening as lawmakers learn more about the details and become more comfortable with the concepts.

"Part of any bill, particularly one that's somewhat controversial, is the acquainting of members with the legislation ... what it does, how it works and what the issues are," he said. And he said because it's a revenue measure, the appropriations committee is a likely next step. "So we're not treating it any different than any other legislation."

Stumbo said the bill offers a solid administrative system to monitor the slots but could use more input on the broader public policy questions, such as the amount to charge for license fees.

On that score, the version that passes on Thursday might vary significantly from Stumbo's original proposal. Keene said a committee substitute will be offered that, among other things, increases the licensing fees that racetracks would pay to about $520 million if all eligible racetracks apply, although the fees could be paid out over five years instead of all up-front. The proposed fees are stair-stepped: Turfway Park would have the highest fee at $125 million, with Churchill Downs and Keeneland at $100 million each, he said. Keene land would have to share its location with The Red Mile. Originally, Stumbo's bill called for a licensing fee of $25,000 per track.

Keene said he expects the bill to pass. "I wouldn't be calling it up if I didn't think it would pass," he said.

Other changes include an exemption from state income tax for active duty military personnel, an exemption from sales tax for agriculture goods purchased for horse farms, and the addition of two new members to the lottery board — representatives from Thoroughbred racing and the Attorney General's office.

Keene said the spending portion of the substitute also includes the addition of a fund for metro governments with racetracks to use toward economic development, tourism and public safety.

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