Kentucky judge rules Instant Racing regulations are legal

LEXINGTON, Ky. – A Kentucky circuit court judge ruled Wednesday that the Kentucky Horse Racing Commission acted within its powers when it adopted regulations earlier this year that will allow state racetracks to operate slot-machine-like devices that use historical races as random number generators.

Franklin Circuit Court Judge Thomas Wingate ruled that the regulations are “a valid and lawful exercise of the commission’s statutory authority to regulate parimutuel wagering on horse racing.” The ruling was sought by the racing commission, along with the state’s racetracks, after the commission passed the rules last summer.

The Family Foundation, a Kentucky organization opposed to expanded gambling, had argued against the regulations, claiming that the devices were prohibited under the state constitution. Although representatives of the Family Foundation did not return phone calls Wednesday, the organization has said previously that it planned to appeal any ruling that would pave the way for the installation of the devices.

The devices, called “Instant Racing,” have been in place at Oaklawn Park in Arkansas for 10 years. Supporters of the devices have claimed that it allows racetracks to offer slot-machine-type gambling without running afoul of state prohibitions on slot machines, but critics, such as the Family Foundation, have said that the devices do not fit the definition of parimutuel racing.

In his ruling, Wingate said that Kentucky’s statutes do not explicitly address whether a race must be run live to fit under the definition of parimutuel wagering. Citing the commission’s regulations, Wingate said that a race can exist as a parimutuel event even after it has been run.

“Historical horse races are horse races; as long as the integrity of the system is preserved by the concealment of identifying information, and as long as the wagering upon the race is parimutuel in nature,” Wingate wrote.

The state’s attorney general, Jack Conway, issued an opinion early in 2010 that the devices were not explicitly illegal under state law, but that the racing commission would need to write regulations to expand the definition of parimutuel wagering in order to allow the devices to be installed at racetracks.

Under the regulations, any racetrack in Kentucky would be able to operate the devices, but some tracks, notably Churchill Downs, have been lukewarm about the devices’ prospects, citing the much higher revenues generated by traditional slot machines. Kentucky’s tracks have been aggressively lobbying for casino-type gambling for the past five years, and they are hopeful of getting authorization for expanded gambling in the 2012 legislative session, if not sooner.