House Bill 106 was introduced on 5 January 2023 and sponsored by representatives Derrick Graham, Cherlynn Stevenson and Rachel Roberts.
If passed, the bill would add 26 amendments to the current law and enact 13 new sections related to online sports, poker and fantasy gambling.
The bill would enable sports betting to be provided by online operators as well as allowing racing tracks to partner with online brands.
A licensed track can only partner up with one online operator, which can provide systems for gambling both on track and online.
Tracks may also offer sportsbooks at two separate locations that it owns or leases within 60 miles of the racing grounds that are not attached to the land of the track.
Sports that would be allowed to be gambled on include the NFL, NBA, MLB, PGA, NASCAR, MLS, NCAA, NAIA and other nationally or internationally recognised sporting competitions.
Applications for a licence to provide sports betting involve a fee of $500,000 (£420,000/€470,000) and an annual renewal fee of $50,000. A tax on revenue of 9.75% will be levied monthly for race tracks and 14.25% on bets placed online.
Participants such as players, coaches and referees as well as close family members to such individuals are banned from placing bets on sports in the state.
Online poker and fantasy sports to be legalised
Online poker would also be legalised in the bill.
To gain a licence, operators must prove an effective use of geotracking software to ensure online poker is confined to the state of Kentucky. Applicants must also display they can verify ages to ensure players under 18 years of age cannot place bets on the platform.
A licence fee of $250,000 and an annual renewal fee of $10,000 must be paid. A tax of 6.75% is due monthly on all fees charged to players to play, including the rake.
The bill also introduced legalising sports fantasy competitions, establishing a licensing process for operators with more than a hundred participants. Those under this limit do not need to obtain a licence.
An application fee of $5,000 is required from companies to gain a licence, with an annual renewal fee of 6% of revenue from the previous year or $5,000, whichever is the greater amount.
There are set to be no restrictions on the digital platforms used by operators to host fantasy competitions.
Fantasy licensees must submit annual records to a public certified accountant to ensure compliance with the law, should it pass. This will come at the cost of the provider, which must also keep daily records of operations and maintain them for at least six years.
To obtain any gambling licence in Kentucky no partner, member, officer, principal, director or stockholder can have been convicted of a crime in the state. If a person is found guilty of a crime after the application has been approved, the licence may be revoked or suspended.
Past attempts to pass sports betting law
This is not the first time that a bill has been introduced to the state house in Kentucky for sports gambling.
In March 2022, Kentucky House Bill 606 was passed in the house but failed to get beyond a Senate Committee.
It was dropped before it was even voted on in the Senate due to a lack of confidence in votes needed to pass the bill.