02/22/2012 3:19PM

Kentucky casino referendum approved by committee

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LEXINGTON, Ky. – A Kentucky Senate committee on Wednesday approved a bill allowing for a referendum that will ask voters whether to approve up to seven casinos in the state, sending the bill to a showdown on the Senate floor, likely within the next week.

The Senate State and Local Government committee, which is chaired by the bill’s sponsor, Sen. Damon Thayer, a Republican, approved the bill 7-4 after a 2 1/2-hour hearing during which supporters contended that the approval of casinos would benefit the state’s racing industry and provide money for social services. Opponents criticized the measure on both moral grounds and on a thorny claim that a specific constitutional amendment must first be passed by the legislature before it can be sent to voters.

The bill was amended at the start of the hearing to strip a requirement that five of the seven casino licenses be directed to racetracks. Instead, the bill allows for up to seven casinos, but it also includes a provision that no casino that is not at a racetrack can be located within 60 miles of a racetrack. The provision effectively restricts casinos to racetracks within the state’s most densely populated corridor, an area that includes Lexington, Louisville, and the Kentucky side of the greater Cincinnati area.

Gov. Steve Beshear appeared in front of the committee for one hour to deliver prepared remarks and take questions from committee members. Beshear, who received hundreds of thousands of dollars in campaign contributions last year from the racing industry during his successful reelection campaign, frequently cited complaints from the racing industry that it is losing ground to racetracks in states where casinos subsidize purses as support for the bill.

The bill would need to be passed by 60 members of the state’s House and 23 members of the state’s Senate in order to put the ballot on the November referendum. But several opponents of the bill indicated during the hearing that if the bill is passed, it may be challenged on constitutional grounds.

Stan Cave, an attorney with the Family Foundation of Kentucky, contended at the hearing that the state constitution does not allow the legislature to approve a ballot referendum of a constitutional amendment. Instead, Cave contended that according to the constitution the legislature has to vote to amend the constitution before the people do.

“Kentucky is not a referendum state,” Cave said. “You could change the constitution to allow it to be, but right now, it is not.”

Officials of the Family Foundation would not directly state whether they would challenge the approval in court, but the organization has in the past challenged pro-gambling measures, including a decision by the Kentucky Horse Racing Commission to authorize Instant Racing machines at racetracks in 2010. The group’s appeal of an earlier decision upholding the commission’s action is pending.