Kentucky is home to one of the most wagered upon sporting events in the world, the Kentucky Derby. Alas, while wagering on horses is legal in the Bluegrass State, other varieties of sports betting are not.
It appeared in 2020 that Kentucky would join the growing wave of states legalizing sports betting. A bill was introduced, many lawmakers favored it, and Gov. Andy Beshear endorsed it as well. But arguments over amendments caused the bill to stall in the House, and the session ended without any sports betting legislation being passed.
During odd-numbered years, KY legislators have 30 days at most to consider new bills as opposed to 60 days during even-numbered years. That reduces the window for legalizing sports betting in 2021.
Meanwhile, more states continue to legalize sports betting, including some that border Kentucky. With continued support among Kentuckians and new bills undoubtedly coming, legal sports betting could be rounding the turn and heading down the home stretch sooner than later.
Here’s an overview of where sports betting presently stands in Kentucky, including a look back at the state’s history of legal gambling and a look forward to how sports betting could take shape in the state.
When it comes to legal gambling in Kentucky, the story mostly focuses on betting on horse racing.
Horse racing in KY dates way back to the 19th century. The famed Churchill Downs racetrack in Louisville first opened in 1875, the same year as the first-ever Kentucky Derby.
In 1891 the state adopted its fourth (and still current) constitution, including language explicitly forbidding gambling. Betting on the horses nonetheless remained popular, and in 1931 judges upheld a statute that exempted pari-mutuel betting on horse races from the gambling ban.
As far as legal gambling goes, that was essentially the extent of it until 1988 when the Legislature proposed an amendment to authorize a state lottery. Voters approved, and the Kentucky Lottery began in April 1989. Soon after in 1992 certain forms of charitable gambling were legalized as well.
Meanwhile daily fantasy sports sites like DraftKings and FanDuel presently serve Kentucky customers, although there is no explicit law authorizing DFS in the state. Recently proposed sports betting legislation has included a provision to legalize and regulate DFS as well, meaning such authorization could be coming.
Technically speaking, there are no casinos in Kentucky, commercial or tribal. However there is a type of casino-like gambling allowed in KY that has allowed several racetracks functionally to become “racinos” — historical horse racing machines.
The machines employ the pari-mutuel wagering method to allow players to bet on historical horse races. That said, many of the historical horse racing machines (also called “instant racing” machines) very much resemble slots, which is a big reason why they remain a source of controversy for gambling opponents in the state.
The Kentucky Horse Racing Commission revised its definition of pari-mutuel wagering to permit historical horse racing machines in 2010. Today thousands of “HHR” machines have been installed at numerous venues all around the state. In fact, the machines have become a huge part of the horse racing industry, generally speaking. In 2019, people placed wagers totaling more than $2 billion on historical horse racing in Kentucky.
Ever since the introduction or HHR machines, opponents have fought them in the courts. In one such case, the Kentucky Supreme Court ruled against one particular variety of the machines in September 2020, agreeing with the argument that they did not in fact use the pari-mutuel wagering system as required. In any event, HHR machines continue to be very popular as the state’s only available casino-like style of gambling.
Also worth mentioning in the context of the history of legal gambling in Kentucky is the state’s battle against offshore online gambling sites. In 2008, the state went so far as to try to seize 141 domain names owned by online gambling sites.
Then-Gov. Steve Beshear (father of current Gov. Andy Beshear) ordered the seizure, describing the sites as essentially illegal “gambling devices.” The order additionally argued the sites harmed the “legitimate, licensed and taxed gaming interests” in the state.
The order was upheld in district court, albeit with an amendment allowing the sites to install geoblocking software preventing access from Kentucky. A few of the sites appealed, and in early 2009 the order was struck down by the Kentucky Court of Appeals. However in 2010, the KY Supreme Court reversed the court of appeals ruling, albeit strictly on the technicality of insisting a representative of one of the domains should appear in court to argue their legal standing.
A trade association called the Interactive Gaming Council then stepped in to represent the owners of the domains. After a few more years of litigation, the Kentucky Court of Appeals allowed the association to intervene. That removed the earlier technicality, effectively striking down the seizure order once again.
Though ultimately inconsequential, Kentucky’s fight against offshore gambling sites accepting bets from those in KY could serve as a meaningful context for the potential future of legal, regulated online gambling in the state. So, too, will the horse racing industry given its special prominence in KY.
The short answer is not right away. That said, lawmakers in Kentucky have certainly shown interest over recent years.
The US Supreme Court ruled in May 2018 to allow states other than Nevada to offer sports betting. Soon after that, a group of Kentucky legislators created a nine-member panel to study sports betting and begin drafting legislation.
In 2019, lawmakers introduced four sports betting bills. The one proposed by Rep. Adam Koenig was the first to make it through a House committee. Koenig’s bill would have legalized sports betting (retail and online), daily fantasy sports and online poker. There wasn’t enough support to push the bill further, however, with then-Gov. Matt Bevin‘s lack of enthusiasm for sports betting also helping slow momentum.
In 2020, Kentucky had a new governor, Andy Beshear, who unlike Bevin supported sports betting. Koenig again proposed his bill, and it made it through committee once more. Before the full House could consider it, however, a number of amendments were added that lessened its attractiveness, and in April the legislative session ended with no further movement.
As noted above, 2021 will feature a shortened legislative session, meaning 2022 might be a more likely target for a sports betting law to get passed. With the further need to finalize rules, accept applications, issue licenses and see to other administrative matters, it will be at least a couple of years before legal sports betting comes to KY.
When it comes to figuring out where Kentucky might allow sportsbooks should the state legalize sports betting, there are several possibilities.
Rep. Koenig’s sports betting bill would have limited retail sports betting to seven locations. The six horse racetracks then in operation could each have gotten a license (a seventh has opened since). The Kentucky Speedway also could have hosted a sportsbook.
In the 2020 session, many amendments were piled onto Koenig’s bill (without his knowledge), which was likely a reason that it failed to advance to the entire House. One was an amendment from Rep. Richard Heath that would have allowed considerably more retailers to offer sports betting. Heath’s amendment would have allowed the state’s 3,200 lottery retailers plus 400 bars and restaurants to apply for licenses.
It’s hard to say how realistic that suggestion really is. In any event, expect at least the racetracks to be in the running to offer retail sportsbooks once the time comes.
Given Kentucky’s interesting history with online gambling, it is a toss-up whether the introduction of sports betting would include an online option as well. There is online wagering on horse racing in the state, so it’s possible a bill could be agreed upon that would allow Kentuckians to place sports bets online. It would be likely that these online betting brands would also have apps.
Koenig’s sports betting bill included a mobile option. An amendment was later added introducing a requirement to register new accounts in person at retail sportsbooks. That requirement would end (or “sunset”) after 18 months, after which people could create accounts online.
Some lawmakers have also expressed wishes to allow local jurisdictions to opt out of sports betting. That would be another potential barrier for online sports betting in the state.
Right now, just horse racing (see below).
If and when sports betting is legalized in Kentucky, expect the usual array of choices of sports upon which to bet. These include:
There are currently no professional sports franchises in Kentucky, although there have been in the past.
Kentucky shares a long border to the south with Tennessee, and many sports fans in Kentucky do root for the Memphis Grizzlies (NBA) and Tennessee Titans (NFL). Pro sports franchises in Missouri, Illinois, Indiana and Ohio also attract fans from Kentucky.
Kentucky is basketball country, and the state loves its college hoops teams.
The Kentucky Wildcats and Louisville Cardinals in particular have huge fan bases, not least because both schools have storied traditions. The University of Kentucky has won eight NCAA men’s basketball titles, second only to UCLA. The University of Louisville has won two, but had to vacate a third title (from 2013). The Western Kentucky Hilltoppers also have a large fanbase in the state.
All three of those schools play in the NCAA Division I Football Bowl Subdivision as well.
The issue of whether sports bettors in Kentucky will be able to wager on college teams from their home state is up in the air. Some lawmakers are strongly in favor of allowing it, while others have proposed including language in a bill prohibiting it.
Kentucky is the horse racing capital of the country. As noted, the Kentucky Derby at Churchill Downs is one of the most bet upon sporting events in the country every year.
In fact, there are several active and popular thoroughbred racing tracks in the state, including:
There are also two harness racing tracks, one of which (Oak Grove) opened in late 2020:
Besides live races, each of these racetracks features off-track betting (OTB) on simulcast races as well. There are no standalone OTB parlors in the state. However, betting on horse racing online is allowed throughout the state, including at the following popular sites:
There are a number of ways to wager on sports:
If and when sports betting arrives in Kentucky, expect all of these types of sports bets to become available.
The minimum age to play the lottery or bet on horse racing in Kentucky is 18 years old. Meanwhile players must be at least 21 years old to play the slots-like historical horse racing machines.
Recently proposed legislation suggests a minimum age of 18 for sports betting.
Online sportsbooks generally offer a variety of depositing and withdrawing methods. Should Kentucky legalize sports betting and include a mobile option, expect to see some or all of the following banking methods available:
The latter cash option refers to depositing or withdrawing funds from the cashier cage in a retail location such as a brick-and-mortar sportsbook. In the case of Kentucky, that might mean visiting one of the state’s horse racetracks if they were licensed to accept sports wagers.
The Kentucky Lottery Commission would likely oversee sports betting in the state, should it be legalized.