Though it is the epicenter of parimutuel horse wagering, single-game sports betting had been a difficult political sell in the Kentucky legislature. Ultimately, proponents were able to overcome opposition from anti-gambling, conservative lawmakers and pass the bill with strong bipartisan support.
The bill allows each of the state’s nine major horse racing facilities to open retail sportsbooks. All nine can partner with up to three mobile operating partners apiece.
This means there could be up to 27 mobile operators, though it is unlikely Kentucky ever sees that many books. No state has 27 live mobile operators.
Churchill Downs owns the eponymous horse track, arguably the most famous parimutuel racing facility in the country. The company stopped taking single-game sports bets via its Twin Spires platform in 2022 and it seems unlikely it will start taking bets again in Kentucky.
Though Kentucky doesn’t have any commercial casino properties, most major gaming companies and sportsbook operators will likely seek a sports betting partnership with the tracks. That includes FanDuel, DraftKings, BetMGM and Caesars, which combined have more than 80% US market share.Other major operators including Barstool, Hard Rock, PointsBet and BetRivers could also seek licenses. Companies looking to grow their US presence including bet365, Fanatics and Betr could also apply.
Kentucky is one of the nation’s lesser populated, least wealthy and least educated states and has no major professional sports team. However, the state is known for its college basketball programs and has a long tradition of parimutuel horse racing, factors that could facilitate betting interests and subsequently sportsbook market participation.
State officials must still pass follow-up regulations before legal wagering can begin. Though there is no firm timeline yet, legal wagering could begin by the end of 2023 or early 2024.
National market impact
Kentucky becomes the 37th state to take legal bets or pass legislation to do so. It is the first state to pass a legal wagering bill in calendar year 2023.
The pending Kentucky launch will fill in one of the few remaining states without legal sports betting in the Midwest region. Neighboring West Virginia, Illinois and Indiana all launched mobile wagering in 2020 or 2019. Ohio launched mobile wagering on Jan, 1, 2023, a factor that also sparked greater interest in passing sports betting in Kentucky. The Bluegrass State shares the Cincinnati metro area with Ohio.
Kentucky neighbors Virginia and Tennessee also have statewide mobile wagering.
Missouri is the only state bordering Kentucky without mobile wagering. Missouri lawmakers are considering legal sports betting legislation this year.