New Kentucky Bill Seeks to Legalize Casinos
A new legislative proposal in Kentucky seeks to bring traditional casinos to the state, marking a potential shift in its gambling landscape. House Bill 33, introduced by Representative Thomas Huff, outlines a plan to regulate land-based and riverboat casinos, as well as the fantasy sports market.
LISTEN TO THIS ARTICLE:The bill assigns regulatory responsibilities to the Kentucky Horse Racing and Gaming Corporation, emphasizing a structured approach to the potential casino industry. It also proposes a 21% tax on casino revenue, a figure that places Kentucky on the higher end compared to other states with legalized casino gambling.
Related: Churchill Downs Preparing New Gaming Property in KentuckyAdditionally, patrons would be required to pay a $3 entry fee to access casino facilities, potentially increasing revenue for operators. These measures highlight an effort to balance industry growth with meaningful contributions to state coffers.
House Bill 33 also includes provisions for local decision-making, allowing counties to determine whether they want casinos in their jurisdictions. To qualify for casino development, counties must meet specific criteria.
Counties must have a population of at least 30,000 residents to be eligible. However, those with existing horse racing facilities are eligible regardless of population size. Smaller counties may join neighboring counties to form a coalition exceeding 30,000 residents to pursue casino projects. For approval, a voter referendum can be initiated either through a petition signed by 25% of the population from the previous election cycle or by a legislative ordinance passed at the county level.
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Highest Bidders Win
The bill further outlines the bidding process for casino licensing. For land-based casinos, the minimum bid fee is set at $750,000, while riverboat casino bids start at $550,000. The bidding process is competitive, with licenses being provisionally awarded to the highest bidder four business days after the bidding deadline.
Existing horse racing and historical horse racing facilities, such as Kentucky Downs, are given preferential treatment in the bidding process. These facilities are allowed to submit bids after the general process ends, provided their bid exceeds the current highest bid by 8% and guarantees the same level of amenities offered by the leading bidder.
The push for traditional casinos comes after recent changes in Kentucky's stance on gambling. While the state has historically been resistant to expanded gambling, attitudes have shifted in recent years. In 2021, Kentucky authorized historical horse racing (HHR) machines, and sports betting was launched in 2023.
HHR machines mimic the appearance of slot machines but base outcomes on the results of past horse races. These changes suggest a gradual acceptance of gambling expansion, driven in part by the state's need for additional revenue.
The need for funding Kentucky's pension system and other state initiatives has been a driving force behind exploring new revenue streams. Similar fiscal pressures contributed to the legalization of sports betting in 2023 under Governor Andy Beshear's administration. The introduction of House Bill 33 reflects a continuation of these efforts, with casinos potentially serving as another source of revenue for state programs.
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