'Games of skill' could add $28 million to Ky. purses under House bill

Legislation filed this week to allow "electronic games of skill" at racetracks could generate more than $28 million for Kentucky purses and $3.14 million for purse supplements, breeders awards and other incentives, if it passes.

House Bill 601, filed by Rep. Harry Moberly, D-Richmond, would let Kentucky racetracks install video poker and blackjack, and games such as Instant Racing, which lets players bet on replays of previously run races.

Instant Racing was developed at Oaklawn Park in Arkansas, where the parimutuel machines have generated $18 million for purses since 2000.

Moberly said he filed the bill to help the horse industry, which pinned financial hopes on what appears to be another doomed bid for slots.

"It's one last effort this session to help the horse industry in this state," Moberly said.

Moberly said he doesn't think it's too late in the session to consider the bill, but any movement is unlikely until the House passes its version of the budget, which could be as early as next week.

"We think that because these are much more like video games that they would be much more acceptable to people than just pure games of chance," Moberly said.

Marty Maline, executive director of the Kentucky Horsemen's Benevolent and Protective Association, said he is looking at the bill.

"A lot of people are of the feeling something is better than nothing," Maline said. "Anything that could improve our purses is something we could embrace."

Gov. Steve Beshear, who pushed for electronic slots to balance the state budget and boost horse racing, downplayed the bill.

"While I have not had a chance to study the bill in detail, it is encouraging that folks are looking for ways to shore up our state's struggling signature industry — every little bit helps," Beshear said in a statement.

A Republican bill

Sen. Damon Thayer, R-Georgetown, said Wednesday that Senate Republicans are working on ways to increase purses and breeders' incentives, but he did not give specifics.

Thayer also has drafted a bill to allow Instant Racing. Last year, he requested an opinion from Attorney General Jack Conway on parimutuel-based expanded gambling.

In January, Conway said that, with some regulatory changes, such an expansion of gambling would be legal.

Senate President David Williams, R-Burkesville, said he thinks instant racing by statute could be constitutional if it is drafted properly, but he has not taken a position on the issue.

"I'm convinced that there won't be any expansion of gambling in Kentucky unless it comes in the form of a constitutional amendment," he said.

"However, there are those who believe that instant racing is not an expansion of gambling but is just a different set of races on which people might wager."

$32 million to the state

The bill designates 13.5 percent of money that is not paid to bettors be used for purses for live horse racing. An additional 1.5 percent would go into purse supplements, breeders' awards, owners' awards and stallion awards.

Tracks would get to keep 69.7 percent of the gambling revenue left after bettors are paid off, or an estimated $146 million a year; the state would get 18 percent of the gambling revenue, or $32 million.

Some of the state's share would go to offset any reduction in lottery ticket sales, with the rest going into a jobs and stimulus program or the state general fund.

To achieve those amounts, about $1.23 billion would have to be wagered each year, with bettors winning back 83 percent, or $1.02 billion.

Voters could block

As many as nine racetracks could operate gambling sites, although Keeneland and The Red Mile might share one.

Jay Blanton, a spokesman for Keeneland, said track officials had not spoken to anyone about the legislation, but they are interested in it.

"It looks like they're talking about the Oaklawn model, and we do know that's been helpful to the horse industry there," Blanton said.

Moberly's bill would not allow local governments to block expanded gambling at tracks or impose additional taxes, but voters could stop it. The bill would require a local voter referendum 60 to 90 days after preliminary approval of a track's license application to the lottery corporation.