The Kentucky attorney general’s office has issued an opinion stating that although there is nothing in state law prohibiting a form of electronic gaming called Instant Racing, it is not currently permissible in the Bluegrass state because it “does not constitute pari-mutuel wagering as defined by the administrative regulations promulgated” by the Kentucky Horse Racing Commission.
The opinion, written by assistant attorney general Lisa K. Lang, was issued Jan. 6, one day after the state General Assembly convened for its regular session, at which the topics of expanded gaming and video lottery terminals at racetracks are expected to be hot-button items.
“The Instant Racing Pari-Mutuel Wagering System is a system that involves wagering on races that have long since concluded,” Lang wrote. “While there is nothing in Kentucky’s Act that clearly prohibits wagering under these conditions, Instant Racing is clearly not the type of pari-mutuel wagering contemplated by the administrative regulations. The administrative regulations... clearly contemplate live racing only.”
While Lang concluded Instant Racing is not currently permitted, she left open the door for it to be implemented by the KHRC changing the administrative regulations. “If regulatory or statutory changes are considered to permit this sort of wagering, the proponents should also be cognizant of the requirements of KRS Chapter 528 with regard to ‘gambling devices’ and consider whether amendments to that chapter are also in order,” Lang wrote.
The opinion was requested by Republican Sen. Damon Thayer, who has said he will introduce legislation during the legislative session calling for a constitutional amendment on racetrack VLTs. Thayer previously said that if legal, Instant Racing could be a short-term measure to generate money for purses at the state’s racetracks and breeders’ incentives.
Thayer said he was pleased that the attorney general had found that Instant Racing is legal under Kentucky statute, but that any effort to get the appropriate administrative regulations changed to permit it would be up to Gov. Steve Beshear and the racing commission. Thayer said he found it ironic that the AG's opinion coinciding with the beginning of the legislative session after he had on three previous occasions appealed to the office to release an opinion.
Attorney General Jack Conway previously issued an opinion in which he said VLTs at racetracks would not require a constitutional amendment.
Instant Racing machines resemble slot machines and offer electronic races that are based on recycled horse and dog races. Instant Racing has been used successfully in Arkansas, where standard slot machines are not permitted, to help generate additional funds for purses at Oaklawn Park. In Arkansas, 14% of Instant Racing revenue goes to the horsemen for purses, which have steadily improved since the introduction of the machines. Other electronic games of skill that are not pari-mutuel in nature are also permitted in the state.
The Instant Racing Pari-Mutuel Wagering System is also not permissible because it does not appear to be in conformance with Kentucky’s well-established pari-mutuel betting system,” the opinion continued. “In Kentucky, the well established practice of pari-mutuel betting requires those who have successfully bet on the same winning outcome share the betting pool. This cannot occur with Instant Racing... While Instant Racing may involved a type of pooled betting, it is not the pari-mutuel betting contemplated by Kentucky’s administrative regulations.”
Finally, Lang concluded Instant Racing is not permitted in Kentucky because the electronic races rely on a “seed pool” to replenish the various win pools with a minimum balance after a payout has been made from the pool.