The new sports betting bill cleared the Senate Licensing and Occupations committee Wednesday — marking a significant moment for legislation that died in the Senate last session.
When presenting the bill to the Senate L&O committee, the bill’s sponsor Rep. Michael Meredith (R-Oakland), said in 2022 that a poll showed 65% of Kentuckians support sports betting.
“This is about regulating a marketplace that already exists,” Meredith said, elaborating that the American Gaming Association there’s $1 billion illegally wagered in betting in Kentucky each year — the fiscal note on the bill says it would bring in roughly $23 million to the state each year.
“We noticed a significant amount of marketplace just going across the state line — across the river — to place their wages,” Meredith said.
Meredith said on the House floor Monday that this bill would allow the Commonwealth to take advantage of funds already spent on gambling that occurs illegally in the state — he mentioned that Kentuckians pull up gambling websites they think are legal because they can access them via their phone or computer.
The new bill clarifies the Horse Racing Commission’s Regulatory Authority and Structure, allowing the tracks to be the main licensees and contract with three sports wagering companies instead of just one, like in previous bills.
Further, an amended version presented earlier this month slightly changed from its original version, with users no longer needing to register their account in person.
Tax rates will also be the same — 9.75% on in-person bets and 14.25% on mobile and online bets, which were included in last year’s House Bill 606.
An amendment introduced on the House floor would send 2.5% of the taxes collected to a problem gambling fund.
Ahead of the Senate committee vote, Rep. Meredith said he felt confident this would be the year for sports betting. He even felt optimistic about getting votes in the Senate where the bill died last year — because it’s a “tax” bill in an odd-numbered year, they’ll need 23 of 38 votes in the Senate this year.
Last session, one of the roadblocks was Committee Chairman John Schickel (R-Union), who wouldn’t hear the sports betting bill sponsored by former NKY Rep. Adam Koenig.
The bill was given some last-minute life on sine die in 2022, but it faced its first hurdle in the Senate L&O Committee.
Chaired by Sen. Schickel, the L&O committee was where the bill was first assigned during the last legislative session. It seemed unlikely that Schickel was going to support the bill. However, he has been a staunch supporter of the racing industry in Northern Kentucky.
He explained in a statement that while he was the primary sponsor of historical horse racing several years ago, he finds thoroughbred racing to be more than a sport: “It’s a past time and an art form,” Schickel said.
After the bill seemed unlikely to pass in the L&O committee last year, it was moved to the Senate Economic Development Committee. Another Northern Kentuckian and former legislator, Sen. Wil Schroder (R-Wilder), also chaired this committee.
Ahead of Wednesday’s meeting, Schickel said he didn’t know if he would consider the bill this year. He provided the lone no vote and said in a statement that his vote isn’t based on morality.
“Hyper-gambling would not improve society and allowing sports betting — especially on our collegiate sports and to a lesser degree professional sports — concerns me,” Schickel said, further drawing attention to gambling on cell phones, which could affect young people.
Gambling on cell phones by young people is also something that David Walls, executive director for the Family Foundation — a Christian organization that lobbies the legislature to follow “biblical values” — said isn’t good.
Walls testified to the committee that this bill is a form of “financial fraud” that sees the government partner with gambling companies.
“Predatory gambling, especially in the expansive form that’s being considered in House Bill 551, is not a victimless form of entertainment for competition,” Walls said.
Further, he asked if the expansion of predatory gambling is good policy during a time of high inflation and high gas prices. He also added that the legislature passed a bill banning slot-style “gray machines” in gas stations and bars.
“After just voting to ban gray machines because of very legitimate concerns about every gas station being turned into a mini-casino, I certainly hope this honorable body will not have to turn around and turn every iPhone into a digital casino that kids will have access to,” Walls said.
Senate Majority Floor Leader Damon Thayer said the legislature couldn’t stop people from doing bad things for themselves.
After the committee meeting, Thayer said the hang-up is still on the Senate floor, where he thinks they’re one to three votes short. The floor vote will most likely occur in the last two days of the session, after the veto period, either March 30 or 31.
In his testimony, Thayer reiterated that this bill is something the public wants, and six of seven Kentucky border states already have sports betting in place.
“You can stand in Covington, Kentucky, and look across the Ohio River and see a brick-and-mortar sports book location,” Thayer said. “The public wants this.”