LSB Interview: Rep. Adam Koenig On KY Sports Betting Legalization

• House Bill 241 would make sports betting legal in Kentucky through both land-based and mobile platforms.
• Sponsor Adam Koenig is hopeful that his bill will pass either in this session or in 2022.
• The focus of the Kentucky General Assembly in 2021 is Historical Horse Racing (HHR) which may not leave much time for sports betting legalization discussions in the condensed session.

FRANKFORT, Ky. – Kentucky will be holding a shortened legislative session in 2021 and Representative Adam Koenig, sponsor of a bill that would legalize sports betting in the state explains what that could mean for the fate of his legislation.

Koenig sat down with LegalSportsBetting to discuss sports wagering in Kentucky as a legal market and the odds of House Bill 241 receiving passage this session. It comes as no surprise that Historical Horse Racing (HHR) is a top priority within the Kentucky General Assembly this year which will be the main focus with lawmakers, putting sports wagering on the backburner.

House Bill 241 And Representative Koenig

House Bill 241 is the exact same bill from last year with the exception of date changes to comply with the new year. There is no difference at all between the bill that came out of the Committee last year and the one being seen this year.

Sports wagering is the biggest part of this proposal although the bill also has the addition of daily fantasy sports (DFS) and online poker up for legalization because per Koenig, the justifications of all three outlets are one and the same which is why he combined them in his proposal.

“We should allow people to make adult decisions and Kentuckians currently engage in all of these activities but no one is there to protect them the way a legal industry in the state would,” said Koenig to LegalSportsBetting. “A state-sanctioned market ensures everything is being done properly. I have heard some opposition for the inclusion of poker with the bill and people requesting that it be taken out and that may have to be done one day but the only basis they’ve had for their opposition was that it was a game that should be played at a casino not online.”

This is not the first time that Koenig has tried to give Kentucky legal sports betting. He has been an advocate for the industry for some time. But he doesn’t believe that KY HB 241 will see enough time in the General Assembly this year to receive the necessary approvals.

“It is probably less likely than in previous years for House Bill 241 to receive any floor time this legislative session because we have to deal with the Historical Horse Racing (HHR) issue we’ve been having but if that legislation moves expeditiously, we may get the opportunity,” said Koenig. “If we have the support, we can get House Bill 241 moving along but, in the end, HHR is the primary issue in 2021.”

Under House Bill 241, there is a tax rate for retail sportsbooks of 9.75% and 14.25% for online and mobile sportsbooks on all GGR. Businesses eligible to operate these platforms are horse racing tracks in the state that are already licensed, making for seven potential spots for sports betting in Kentucky.

Koenig cites the findings of the American Gaming Association that say gamblers in Kentucky spend over $2 billion with various gaming outlets combined, making the estimate he’s given for a legal sports wagering industry on the conservative to the almost low end of the spectrum.

“Our estimate on revenue from the legal sports betting market and it was a conservative estimate was $25 million annually. In retrospect, people were saying that that wasn’t enough money to make it worth it. I wish I would’ve been generous with my estimates for what the industry could bring in instead of letting my conservative nature take over with the figures that were released but lesson learned,” said Koenig. “I think revenue numbers will be much higher than that but there is only one real way to find out and that’s to pass the bill.”

Not only will there be mobile and land-based sportsbooks but both professional and collegiate sports will be open for wagers. The University of Kentucky and the University of Louisville with huge fanbases would be able to have action put on their matchups. So much money is lost every year to neighboring states with legal sportsbooks and other outlets that could all be money used for Kentucky’s economy. But Koenig doesn’t believe revenue is really considered when discussing the industry.

“If revenue was a real driver, I think the bill would have been passed already but there is a group called the Family Foundation that is adamantly opposed to any expanded gambling and they’ve been very effective over the years in halting efforts to expand gambling which has left us far behind our neighboring states over the years,” said Koenig.

When asked why he is so passionate about making sports wagering a legal market for Kentucky, the answer was simple. Yes, there are profits and other things that can be gained but really, it’s about getting the Bluegrass State up to speed with other states in the nation while letting adults choose for themselves.

“I believe in personal responsibility, adults are doing it already by using offshore accounts, legally crossing the border going to other states, illegally with bookies, and I think legalization of sports betting in Kentucky is a good idea because we will be able to set up a framework where Kentuckians will be able to keep their money in Kentucky, they will have protections in Kentucky, and they’ll be able to make adult decisions like grown adults should be able to do in regards to what they do with their money and their free time,” said Koenig.

What’s Next?

The Kentucky General Assembly adjourns for the year on March 30. Governor Andy Beshear is in favor of legalized gambling on sporting events and Koenig appreciates the Governor’s support with this matter. It could ultimately help his bill in receiving more favorable votes within the Assembly. Should House Bill 241 receive passage, Koenig believes the legal sports betting market could launch by the end of the year.

“The rules and regulations need to be put forth and the Kentucky Horse Racing Commission (named the regulator within the bill) is very familiar with my desire to get this passed so they should now be at least part of the way finished with having some rules and regulations for the industry already drawn up so we could likely expect the industry to go live hopefully by the end of the year if not sooner,” said Koenig.

All in all, Koenig will press on with House Bill 241 and trying to get legal sports betting for Kentucky up and running. This year may not see it because of HHR but that will not stop him from continuing to try in the years ahead.

“It’s a short session, it’s going to be difficult but the HHR issue frankly will be the biggest change in the gambling laws of Kentucky since the 1988 constitutional amendment to allow the lottery. After that, maybe people will be more inclined to realize it’s not the end of the world to legalize sports wagering, whether it be this year or next year and that’s what I’m hoping for,” said Koenig.

News tags: Adam Koenig | American Gaming Association | Andy Beshear | Family Foundation | House Bill 241 | Kentucky | Kentucky General Assembly | Kentucky Historical Horse Racing | Kentucky Horse Racing Commission | Kentucky Lottery | University of Kentucky | University of Louisville