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Keeneland, Red Mile Temporarily Closing Historical Horse Racing Gaming Room

The Keeneland Association and Red Mile issued a joint statement on Sunday saying the two Lexington, Ky., companies were temporarily shutting down historical horse racing (HHR) gaming machines at The Red Mile harness track. The closure, which takes effect at the end of business on Sunday, comes in the wake of a decision last week by the Kentucky Supreme Court not to rehear the case in which the court found in favor of the Family Foundation by a 7-0 decision, saying Exacta Systems HHR games do not qualify as pari-mutuel wagering because wagers are pooled from multiple races that determine the outcome of a bet made at a specific machine.

“We were disappointed the Kentucky Supreme Court denied our petition for rehearing,” the statement said. “At this time, Keeneland and Red Mile have made the very difficult decision to temporarily close historical horse racing operations until there is more clarity surrounding the situation. We have confidence the Kentucky legislature will continue its efforts to protect jobs and state revenue generated by historical horse racing, as well as protect Kentucky's signature horse racing industry.”

Promotional materials from Red Mile Gaming & Racing indicate the facility has 138 themed HHR games on which to bet. Sixty-eight of those games are from Exacta, with the remaining machines distributed by Ainsworth and Parimax.

In the wake of the September Supreme Court ruling, Exacta officials said they would make software adjustments to meet the Supreme Court standards.

None of the other HHR operators in Kentucky have indicated they would shut down while awaiting legislative action. Churchill Downs Inc.'s Derby City Gaming in Louisville and Oak Grove Gaming and Racing in Christian County both use Ainsworth games, which were not in place when the Family Foundation suit was filed in 2012. Kentucky Downs in Franklin, Ky., the first track to embrace HHR, also remains open.

Historical horse racing has added millions of dollars to Kentucky purses annually since approved by the Kentucky Horse Racing Commission in 2010.

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KY Supreme Court Won’t Hear HHR Legality Case

The Supreme Court of Kentucky ruled Jan. 21 that it will not rehear an appealed Sept. 24 decision that told a lower court to re-examine the legality of historical horse race (HHR) gaming in the commonwealth, keeping the most crucial form of funding for purses at the state's five Thoroughbred tracks in peril.

HHR handled $2.2 billion during the Commonwealth's most recent fiscal year, and revenue from that form of gaming annually contributes tens of millions of dollars to the Kentucky purses. This form of gaming has been operational–but challenged by opponents in the courts as illegal–for the better part of a decade on the grounds that HHR does not meet the definition of pari-mutuel wagering.

Although Thursday's Supreme Court decision was not entirely unexpected, it eliminates an avenue for keeping HHR functional in Kentucky, making it clearer that getting HHR passed via new legislation remains the Thoroughbred industry's best path forward, according to some stakeholders.

Tonya Abeln, the vice president of communications for the gaming corporation Churchill Downs, Inc. (CDI), told the Louisville Courier-Journal that, “The Kentucky Supreme Court clearly told the industry to work with the General Assembly on achieving a legislative solution. Our top priority for the 2021 legislative session is maintaining the status quo to ensure historical horse racing can continue operating in Kentucky as it has for the past decade.”

CDI, which owns the tracks and gaming licenses associated with Kentucky's Churchill Downs and Turfway Park, has already halted reconstruction on its demolished Turfway grandstand, vowing late in 2020 not to continue until HHR's legality gets sorted out.

Officials at Keeneland Race Course told WTVQ in a statement that, “We are aware of the decision and are evaluating our options moving forward.”

Although the Supreme Court case only involves HHR machines of a particular brand, the gaming systems operate in broadly the same manner throughout Kentucky, meaning that a precedent established for one version is likely to affect all forms of HHR gaming.

But the near-term fate of HHR remaining operational was still murky as of Thursday evening.

“The Kentucky Horse Racing Commission [KHRC] will act in accordance with the terms of the judgement entered by the Franklin Circuit Court, pursuant to the September 24, 2020, opinion of the Kentucky Supreme Court,” stated a Kentucky Public Protection Cabinet statement posted to Twitter. “The KHRC will not provide additional comment at this time, due to ongoing litigation.”

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Kentucky Supreme Court Declines To Review Historical Horse Racing Decision

The Kentucky Supreme Court issued a brief statement on Thursday in which it declined to reconsider the unanimous decision on historical horse racing machines issued on Sept. 24, 2020, reports the Courier-Journal. The request was issued by the Kentucky Horse Racing Commission and state's racetracks.

Meanwhile, legislative solutions to legalize historical racing machines are in the process of being crafted. Among the supporters of historical racing are Gov. Andy Beshear and Kentucky Senate Majority Floor Leader Damon Thayer.

“Our top priority for the 2021 legislative session is maintaining the status quo to ensure historical horse racing can continue operating in Kentucky as it has for the past decade,” Tonya Abeln, vice president of communications for Churchill Downs, Inc., told courierjournal.com. The preservation of the associated $5.2 billion economic impact statewide as well as the direct and indirect jobs of 60,000 Kentuckians impacted by HHR is now in the hands of the Kentucky General Assembly.”

Kentucky Governor Reiterates Calls To Support Sports Wagering, Historical Horse Racing

During Thursday's State of the Commonwealth and Budget address from the governor's mansion, Kentucky Governor Andy Beshear reiterated his support for both sports wagering and historical horse racing.

“Speaking of laws that unduly restrict us from growth and innovation,” Gov. Beshear said, “it is time to legalize medical marijuana, pass sports betting, and save historic horse racing.”

While Gov. Beshear's remarks on the subject were brief this Thursday, he has long been a supporter of both historical horse racing and sports wagering. The former has come under fire, however, due to a Kentucky Supreme Court decision last September which declared at least one version of historical horse racing terminal to not constitute pari-mutuel wagering, and thus to be illegal.

In response to the state's Supreme Court ruling, Churchill Downs has halted major construction projects at both it's Louisville, Ky. flagship track and at the recently-purchased Turfway Park in Florence, Ky.

In mid-December, during a virtual legislative preview conference, Gov. Beshear urged lawmakers to legalize historical horse racing in support of Kentucky jobs and the over $21 million it contributes to the state's budget.

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