Kentucky Lawmakers Consider Overriding Beshear Veto Of Gaming Regulation Bill

Kentucky Lawmakers Consider Overriding Beshear Veto Of Gaming Regulation Bill
Fact Checked by Thomas Leary

The Kentucky General Assembly is set to resume its 2024 session on Friday, and one item left to resolve is whether lawmakers will override a veto on a bill that would dramatically change gaming regulation in the commonwealth.

Gov. Andy Beshear rejected Senate Bill 299 on Tuesday. In a three-page statement, he called the bill sponsored by Senate Majority Floor Leader Damon Thayer, R-Georgetown, “an unnecessary and unworkable bill” that would create unintended consequences for many in Kentucky’s gaming industries.

SB 299 would remove regulating horse racing, sports betting and charitable gaming away from the executive branch and instead place that within a public corporation. It would create the Kentucky Horse Racing and Gaming Corporation, removing the Kentucky Horse Racing Commission from the state’s Public Protection Cabinet in July of this year and the Department of Charitable Gaming from the cabinet in July 2025.

SB 299 picked up traction late last month when Thayer and House Speaker David Osborne worked to amend the bill. It passed the Senate on March 26 and the House two days later, just before the General Assembly recessed for the 10-day veto period.

“Any effort to create an independent corporation should be drafted, vetted and approved over months,” Beshear, a Democrat, said in his statement. “This version had just days. In its current form, it endangers horse racing, sports wagering and charitable gaming.”

Lawmakers will return to Frankfort on Friday and Monday to conclude the 2024 General Assembly session across Kentucky sports betting. Only a simple majority from both chambers is needed to override a veto, and Republicans hold large majorities in both chambers.

Thayer told Thursday he expects legislators to override the veto.

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Bill Requires Senate Confirmation Of Board Members

According to the bill, the new entity would be governed by a 15-member board, the members of which would be appointed by the governor. However, those members would then need to be confirmed by the Senate.

Appearing before House and Senate economic development committee members two weeks ago, Thayer told his legislative colleagues Senate confirmation adds “a higher degree of scrutiny” to the selection process. That’s important because of the amount of tax money historical horse racing and sports betting are expected to generate in the coming years.

“We do a complete state police background check,” he said. “The conferees are required to come before a Senate committee, where members of the committee review their entire application. If they indeed pass that state police background check, members of the committee can then ask questions of the of the conferees.”

Each member would serve a four-year term, and most would come from racing and equine circles. The board would consist of three representatives from the thoroughbred racing industry; a representative from the standardbred racing industry; an equine veterinarian with an active practice tending to race horses; an individual with “particular knowledge” regarding horse breeding; an individual with “particular knowledge” pertaining to horse racing; and a licensed trainer.

Other members would include someone with a law enforcement or investigation background; three professionals considered “experts in the gaming industry” (with one of those individuals having technical experience in historical horse racing); two people representing charitable gaming; and an “at-large” member with no stake in any industry the KHRGC would regulate.

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Nonprofit Head Fears Impact To Charitable Gaming

Hours after Beshear’s decision, the founder of a Louisville-based nonprofit with a formidable presence in charitable gaming took to social media to encourage people to call lawmakers and ask them to uphold the veto.

Mike Mulrooney established Shirley’s Way in Louisville more than a decade ago to honor his late mother, who fought cancer. The organization’s primary mission is to help cancer patients in need of financial assistance, either for medical treatment or necessities. In recent years, Shirley’s Way has used electronic pull-tab machines to raise money. The machines look like a Las Vegas-style slot machine. However, the e-pull tabs have a set number of tickets featuring predetermined payouts, just like the paper pull tabs sold at bingos and other fundraising events.

“We cannot allow charitable gaming to be pushed under the horse racing commission because they consider us competition, and we're not competition,” he said. “All I can speak is for us. We won't make as much in the year that they make in a day, but they consider us their competition.”

Speaking before lawmakers late last month, Mulrooney said the machines have helped Louisville-area bars where many machines have been placed and also allowed Shirley’s Way to expand its scope and help the community in other ways. For example, Mulrooney mentioned his group filled the void after one organization was forced to cut schools from its campaign to fight child hunger.

USA Today photo by Michael Clevenger.

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Steve Bittenbender

Steve is an accomplished, award-winning reporter with more than 20 years of experience covering gaming, sports, politics and business. He has written for the Associated Press, Reuters, The Louisville Courier Journal, The Center Square and numerous other publications. Based in Louisville, Ky., Steve has covered the expansion of sports betting in the U.S. and other gaming matters.

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