Alternative gaming at Kentucky racetracks must be tied to a constitutional amendment, and the public must have a say in how the state's share of the revenue is spent, the former governor of Kentucky said June 22 during a panel discussion at the Thoroughbred International Exposition & Conference in Lexington.
Brereton Jones, the former governor of the Bluegrass state and owner of Airdrie Stud near Midway, Ky., said racetrack gaming is "doable," but it must be handled with common sense. He said if racetrack gaming is addressed by statute, the legislation would be subject to change on a yearly basis, and gambling would most likely proliferate beyond the state's eight license racetracks.
"Every time the General Assembly comes to town, it can change the rules, and it will," Jones said during a discussion titled "Alternative Gaming -- Is It Worth The Gamble?"
Jones, who admitted he wasn't a fan of slot machines at racetracks when the first racinos opened in other states, suggested Kentucky racetracks be permitted to offer full casino gambling in an effort to become "entertainment destinations." He said such a complex at Churchill Downs, for example, would be a huge revenue-producer the week of the Kentucky Derby alone.
Jones said all the revenue splits -- for racetracks, horsemen, and state programs such as education -- must be spelled out in any constitutional amendment. He said a coalition of diverse interests must be formed before any question makes it to the ballot.
During the 2002 and 2003 legislative sessions in Kentucky, legislation to allow electronic gaming devices at racetracks failed to pick up much support. The racetracks took the lead and went so far as to offer the state $400 million in up-front tax payments in an effort to solve the state's budget crisis and get the bill passed.
Turfway Park president Bob Elliston, one of the speakers on the panel, said the push was actually an industry effort that "attempted to respond to an immediate budgetary need." He acknowledged permanence is important, but warned time is of the essence.
"The Kentucky breeding industry will be front and center in the next wave of competition," Elliston said in regard to the growing popularity of state-bred programs in California, Florida, and New York, where video lottery terminals are about to be installed at most racetracks. He said Kentucky's racing and breeding industry, as important as it is to the state's economy, still hasn't created empathy at the state capital.
Dr. Richard Thalheimer, an economist at the University of Louisville, said there is no ideal model for racetrack gaming because in all the states that have it, racing and breeding was teetering on extinction. The first model in what would be considered a healthy state by industry standards is New York, which finally has a VLT revenue structure agreeable to racetracks and horsemen. The first machines could be up and running by early next year.
Ray Paulick, editor-in-chief of The Blood-Horse
, moderated the panel discussion, one of several held June 20-22 at the exposition. TIEC brought together more than 200 companies that provide products and services to the Thoroughbred industry.