Kentucky horse legislation faces big change

By BRUCE SCHREINER

FRANKFORT, Ky.

Supporters of legislation meant to bolster Kentucky's racing industry were sent backtracking Tuesday to revamp a key provision before it goes before the Senate.

Sen. Damon Thayer, the proposal's lead supporter, said a new version being drafted would drop legislative authorization of Instant Racing at Kentucky's race tracks. It would retain a 1.5 percent fee on Instant Racing wagers should the new form of gambling on old horse races be approved through a gubernatorial executive order or by action from the Kentucky Horse Racing Commission.

Thayer, R-Georgetown, said the revision was set to be considered Wednesday by the Senate committee that he leads as chairman. If the committee approves the changes, he was hopeful that the full Senate would take up the measure later in the day.

Thayer said the changes were made after Senate President David Williams, R-Burkesville, indicated to him that a compromise was needed for it to move.

"I believe Instant Racing is another form of pari-mutuel wagering," Thayer said. "Not everybody agrees with me. I've struck a compromise to try to keep the issue moving foward so that we can provide some sustainable and immediate relief for the horse industry."

Instant Racing is a game in which gamblers bet on past races without knowing the names of the horses. Thayer has said it has been a big success at Oaklawn Park in Arkansas, where track officials credit the game with helping make millions in extra prize money for living racing.

Under the Kentucky bill, money generated from a 1.5 percent tax on Instant Racing wagers would flow into a fund to supplement race purses for Kentucky-bred horses at Kentucky tracks.

Williams said Senate action on the bill would not signal its approval for expanded gambling.

"This will accomplish what the intent of the legislation was, and that is if it (Instant Racing) happens, to put 1.5 percent on it to take care of the purses," Williams said.

Gov. Steve Beshear has said he supports the concept of Instant Racing. He said the measure is an acknowledgement that Kentucky's signature horse industry is facing serious problems. But Beshear said he would withhold judgment on the legislation until he sees a final product.

The measure would return to the House if it passes the Senate. The House version only included a tax on bets made through online and telephone betting services.

The legislation comes amid worries that Kentucky's racing industry is falling behind as tracks elsewhere have sweetened purses by offering casino-style gaming.

Beshear has been a strong proponent of expanding gambling at Kentucky race tracks by allowing video slot machines, and his budget proposal assumed $780 million in new revenue from the slots. But the proposal has been a nonstarter with lawmakers this year.

The measure being pushed by Thayer would also impose a 1.5 percent tax on Internet wagering of Kentucky horse races. That proposal seeks a share of the money from the growing popularity of online and phone betting. That revenue would also go to boost live racing in Kentucky.

The bill would also do away with the state's two-tiered pari-mutuel taxing system for wagering at the tracks. Instead, it would set a flat rate of 1.5 percent.