The Kentucky Derby has a long history of pre-race wagering.
One hundred and fourth-eight years, to be exact.
Future versions will come with added twists.
For the first time, in-state horse racing tracks, including Churchill Downs, are poised to become licensed sports betting facilities.
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Sen. Damon Thayer: ‘There’s An Opportunity To Create New Fans’
Since Kentucky Gov. Andy Beshear signed House Bill 551 into law on March 30, new revenue streams will be created for the state and additional waves of bettors are expected to emerge when the law takes effect June 29.
Like past events, scores of individuals will place bets on Saturday’s 149th Run for the Roses. By the fall, residents of the Bluegrass State are poised to take advantage of online wagering for college and professional sports.
Sports betting in Kentucky is expected to generate approximately $23 million in annual tax revenue and licensing fees. Before the passage of legalized sports betting and the establishment of sportsbooks at in-state horse racing tracks and brick-and-mortar establishments, millions of dollars in tax revenues were being lost to nearby states.
Now, the long tradition of horse racing wagering should attract action from other sports. And vice versa.
“There’s no revenue stream in the bill specifically for horse racing, but I think by requiring that the retail betting locations are at racetracks and simulcast centers, it can expose a new type of a bettor to horse racing,” State Sen. Damon Thayer said, as reported by the Associated Press. “There’s an opportunity to create new fans and anytime you create new fans, that’s good for all participants — racetracks, owners, trainers, jockeys, et cetera.”
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Jonathan Rabinowitz: ‘Commission Is Excited For The Opportunity’
The seed of the state’s new revenue streams will come from an old source, horse racing.
“We just see sports wagering as an evolution of a parimutuel product that we’ve been stewards of for two centuries, said Chauncey Morris, the executive director of the Kentucky Thoroughbred Association.
After years of failed attempts to legalize sports betting in Kentucky, Thayer was shocked by the passage of the legislation. Officials are now working toward developing sports betting regulations. A portion of the tax revenue will be earmarked for individuals who develop gambling problems and the state’s public pension system, according to The AP.
One stipulation has been finalized. Horse racing tracks will have to pay an upfront fee of $500,000 to become licensed sports betting institutions. The tracks also will have to pay $50,000 for annual license renewal. Beshear said he expects the regulations to be in place before the NFL’s regular season kicks off.
Kentucky horse racing tracks are projected to allow three sports betting service providers. The providers will be regulated by the Kentucky Horse Racing Commission (KHRC). They will need to pay $50,000 initially for a license and a $10,000 annual renewal fee.
The KHRC is also playing a key role in aiding the Public Protection Cabinet to draft the new rules.
KHRC Chairman Jonathan Rabinowitz told The AP the KHRC has big plans.
“The commission is excited for the opportunity afforded to it,” he said. “(The KHRC is ) working tirelessly to craft clear, responsible, and thorough regulations for sports wagering in the commonwealth.”