Kentucky Gov. Steve Beshear

Kentucky Gov. Steve Beshear

Anne M. Eberhardt

Racetrack Gaming Part of KY Special Session

Racetrack gaming will be on the agenda for a special session in Kentucky.

Democratic Kentucky Gov. Steve Beshear announced June 4 that racetrack gaming would be included in the special legislative session that will focus on the state budget.

Beshear, during a press conference, reiterated his contention that Kentucky’s horse racing and breeding industry is in crisis because of competition from programs in states that allow casino-style gambling at racetracks. The horse industry has pushed for expanded gambling for years.

Beshear’s plan is similar to that of Democratic Speaker of the House Greg Stumbo, who earlier this year introduced a bill to authorize video lottery terminals at the state’s tracks. The measure picked up support but never made it to the House for a vote.

Under the plan to be brought before legislators, the Kentucky Lottery Corp. would oversee VLT gaming. The special session is set to begin June 15; its length hasn't been set in stone.

On June 3, the Kentucky Equine Education Project acknowledged Beshear's concern for the industry, and also predicted racetrack gaming legislation would be voted upon, and pass, the legislature during the special session.

“Kentucky is, and remains, the horse capital of the world,” Beshear said. “But if we do not act, if we refuse to stand up for our signature industry, that title could be changed to 'former horse capital of the world.' As governor, I cannot--and I will not--stand idly by and let that happen. Not without a fight.

"This proposal would allow thousands of working-class Kentuckians to continue to provide their families with a roof over their heads, food on their tables, and the ability to send their kids to school.”

Beshear, who in 2007 made casino gambling part of his campaign for election, said his administration is drafting legislation. He said that while expanded gaming at tracks would not impact the 2009-10 budget, it would create recurring net revenue that could help close the gap created when federal stimulus dollars are no longer available in two years.

Beshear's budget plans calls for $200 million in spending cuts and use of more than $700 million in federal stimulus funds.

Beshear also said he believes the legislature can move forward with the proposal without a constitutional amendment. “The legislature, in our judgment, has the authority,” he said. “Now, we must determine if we have the will. It’s time to vote on it, up or down, with full knowledge of what is at stake and what is at risk.”

Keeneland president Nick Nicholson called racetrack gaming legislation “the opposite of a bailout” during a June 4 interview on WVLK 590 radio in Lexington. “It would be private-sector money spent where gambling is already taking place. We would use that money to try to help ourselves.”

Nicholson, during the early afternoon interview, wouldn’t tip his hand when asked whether Beshear was holding the 2 p.m. EDT press conference to announce racetrack gaming was on the call for the special session.

“We’ll see in a half-hour,” he said with a laugh. “It would not surprise me if it does (end up on the call), but it wouldn’t surprise me if it doesn’t (today). But I think it will be (part of) the session.”

Nicholson, in the radio interview, said he acknowledges concerns that casino-style gambling could spread beyond the racetracks. He said that’s not the intention of the legislation.

“I think we would need to be disciplined,” Nicholson said. “Our intent is to do this with a moderate, temperate approach to do what we need to get done. It’s something I would hope would not grow and grow.”

Should racetrack VLTs become law, machines could be operating “probably within a year,” Nicholson said. The Kentucky Lottery Corp. would need to implement regulations, facilities—at least temporary ones—would need to be built, and there could be court challenges to the law.

KEEP issued another statement June 4.

"We are extremely excited that the governor has chosen to include VLTs at racetracks on the special session agenda," the statement said. "His leadership on this initiative should be applauded by everyone involved in the signature industry of the state. We’re confident that he and most members of the House and Senate will shepherd this legislation through successful passage.

"It is critically important to level the competitive playing field with other states. This is exactly what is needed and at the exact time it is needed."