Blog By: Caroline Hood
Sports betting has been a controversial topic in the country for a while.[i] However, in 2018, the United States Supreme Court struck down the law that prohibited sports betting entitled the Professional and Amateur Sports Betting Act.[ii] Therefore, it became legal for states to individually pass laws allowing sports betting in their states if they chose to.[iii] As of September 2023, three-fourths of states passed laws allowing for sports betting.[iv] The newest state to pass such a law is Kentucky, which passed a sports betting bill, HB 551, on March 31, 2023.[v]
On September 7, 2023, sports betting for in-person locations launched.[vi]Andy Beshear, the governor of Kentucky, placed his first bet on September 7, 2023, at Churchill Downs, the infamous home of the Kentucky Derby, located in Louisville.[vii] In total there are 10 in-person betting locations throughout the commonwealth.[viii] The Kentucky Horse Racing Commission approved each of these locations.[ix] Online betting became available to people throughout Kentucky just four weeks after the legalization of in-person betting.[x] Each location the Kentucky Horsing Racing Commission has approved is allowed to partner with up to three online betting apps.[xi] A few examples of these apps are ESPN Bet, FanDuel, and DraftKings.[xii]
Now, although sports betting has not always been legal in Kentucky, betting on horse races has remained a vital part of Kentucky’s economy for many years, with the first instance of parimutuel betting occurring in 1875.[xiii] This type of betting involves a person wagering on a specific outcome, such as that a particular horse will win the race. [xiv] If that horse does win, the earnings pot is divided evenly amongst all who bet on that outcome.
There is a general consensus that Kentuckians love betting on horse races, but many are divided about allowing sports betting on other sports, like basketball and football.[xv] Some are afraid that allowing sports betting will take money away from the available income that supports the race industry.[xvi] Others worry about the possibility of people developing a gambling addiction.[xvii]
However, this newly-passed legislation is positive for Kentucky. First of all, although the money from the sports betting apps or in-person sports betting will not go into the pot to help provide for the winners at the equine tracks, the sports betting will still draw people to the tracks. This move could bring more people who had not come to the tracks before to spend money. If there are more people at the tracks, there is a higher possibility that they will spend money on the horses, ultimately increasing the pool of money for the race winners. Not to mention, the Kentucky Horse Racing Commission will control all of the new regulations around sports betting.[xviii] The Commission will likely make rules that benefit the horse racing industry while allowing the new sports betting economy to grow.
Comparing Kentucky’s old ways of prohibiting sports betting beyond the equine industry to states that permitted betting on all sports, both in-person and online, a significant decline in revenue is apparent.[xix] With the legalization, that income growth will go into Kentucky’s pockets and allows for improvements to the state. In fact, Governor Beshear posted on Facebook that during the first two weeks of in-person betting, Kentuckians wagered a whopping $4.5 million. This increase in revenue affords the opportunity to address ongoing state needs. [xx]
However, when it comes to the worry of many about gambling and the addiction that can follow, which is enhanced with easily accessible modes of betting, like using apps, one only has to look at the history of Kentucky. Horse betting has been allowed for many years and Kentucky has not dissolved into a chaos of gambling addiction. This move will only allow Kentucky to capitalize on a move that many other states have already made.
This law is still brand new though and, as such, Kentucky will watch as the Commission and Kentuckians work together to smooth out the kinks. Who knows perhaps if it goes well the horse racing tracks could expand the number of betting apps they can partner with? The racetracks might even expand where the in-person betting can be held. Kentuckians will just have to wait and see.
[i]Supreme Court Strikes Down Federal Law Banning Sports Gambling in Most States, CBS News (May 14, 2018, 10:28 AM), [https://perma.cc/8K2S-JT3C].
[ii]Id.
[iii]Id.
[iv] Bruce Schreiner, Legal Sports Betting Opens to Fanfare in Kentucky; Governor Makes the First Wager at Churchill Downs, ABC News (Sept. 7, 2023, 12:37 PM), [https://perma.cc/W859-HYNY].
[v]Russel Joy, Is Sports Betting Legal in Kentucky? Updates for Sept. 2023 Launch, Newsweek. (Aug. 10th, 2023, 11:57 AM), [https://perma.cc/ZV4K-F6QM].
[vi]Lucas Aulbach, With Sports Betting Opening Soon in Kentucky, Here’s Where You Can Bet and Other Key Info, Courier J. (Sept. 5, 2023, 5:43 AM), [https://perma.cc/J9K9-AAU3].
[vii]Schreiner, supra note iv.
[viii]Id.
[ix]Id.
[x]Id.
[xi]Id.
[xii]Id.
[xiii]Kentucky’s Online Gambling Laws 2023, U.S. Gambling Online, [https://perma.cc/M8FR-8SNW].
[xiv]Audrey Weston, Guide to Parimutuel Betting, Gamblingsites.com (Nov. 18, 2022, 10:42 a.m.), [https://perma.cc/5ZDW-F9L3].
[xv]Jacob Munoz, Legal Sports Betting Launches at Kentucky Horse Tracks, Gaming Facilities, Louisville Pub. Media (Sept. 7, 2023, 5 PM), [https://perma.cc/9XND-ZNR9]; Schreiner, supra note iv.
[xvi]Id.
[xvii]Schreiner, supra note iv.
[xviii]Id.
[xix]Schreiner, supra note iv.
[xx]Andy Beshear, Facebook (Sept. 21, 2023, 4:30 PM), [https://perma.cc/67LB-LNMA].