The legislative session is coming down to the wire. Only four legislative days remain before the start of the veto recess.
Gambling in Kentucky was one of the big issues House lawmakers focused their efforts on this week. House Bill 594 received approval in the House on Wednesday by a 64-32 vote. The measure would ban gray machines, or skill games, in Kentucky.
The bill was first brought to the floor for a vote on March 3, but the House voted to table the measure at that time. A motion to bring the legislation back to the House floor for a vote was successful on Wednesday.
Supporters of HB 594 say the purpose of the bill is to clarify what types of gaming are legal under Kentucky law. Critics of the bill say they would like to see gray machines regulated and taxed in Kentucky instead of banned.
HB 594 carves out exceptions for charitable gaming, e-sports competitions, and skill-based contests. The bill defines "coin-operated amusement machines" like games played at retail establishments like Chuck-E-Cheese. Those along with carnival games would not be banned under this bill. Pari-mutuel wagering, historical horse racing and e-sports would remain legal as well.
HB 594 would also create a civil penalty for those who violate the statute. Anyone who conducts, finances, manages, supervises, directs, or owns a gambling device would be subject to a $25,000 fine per device payable to the local county government.
HB 594 will now go before the Senate for consideration.
Another bill related to gambling making its way through the Kentucky General Assembly is House Bill 551. The bipartisan measure would legalize, regulate, and tax sports wagering in Kentucky.
The House Licensing, Occupations and Administrative Regulations Committee unanimously approved House Bill 551 on Wednesday. Under HB 551, the Kentucky Horse Racing Commission would oversee and regulate the sports betting industry.
Only licensed tracks would be permitted to obtain a sport wagering license through the commission. A licensed track would pay an upfront $500,000 sports wagering licensing fee and an annual $50,000 renewal fee.
In addition, HB 551 prohibits several types of people from participating in sports wagering, such as anyone under the age of 18. A person who is participating in a sporting event either as a player, coach, official or owner of a team would also be prohibited from placing a wager on a game or event they're associated with. Violators would be guilty of a class A misdemeanor. A person who tampers with an outcome of a sporting event would be guilty of a class C felony.
The state would make an estimated $23 million annually off sports wagering through a 9.75% tax on revenue at tracks and a 14.25% tax on revenue from online wagers. After administrative costs, the remainder of the revenue would be deposited into the permanent pension fund.
Critics of HB 551 worry that legalizing sports wagering will lead to the exploitation of vulnerable Kentuckians with gambling addictions. Critics also worry about children having access to online sports wagering platforms.
Supporters of HB 551 say the bill would regulate a $1 billion industry that has been operating in the shadows in Kentucky for quite some time. The bill would protect Kentucky consumers, they added.
HB 551 is now before the full House for consideration.
As always, I can be reached through the toll-free message line in Frankfort at 1-800-372-7181. Feel free to contact me via email at Thomas.Huff@lrc.ky.gov. For more information, please visit the legislature’s website at www.legislature.ky.gov.