Matt Koch | Horse Racing Free Tips

Kentucky House Passes HISA Funding Review Resolution

One day after Kentucky's state senate adopted a resolution by voice vote to urge a review of the HISA funding methodology, the Kentucky House of Representatives did the same. House Resolution 98, “A resolution expressing concerns regarding the unintended consequences of the current funding methodology of the Horse Racing Integrity and Safety Act,” was adopted by a voice vote in the House.

The resolution was sponsored by Republican representative Matthew Koch, and Democratic representative Al Gentry.

The language is identical to that of its companion resolution in the Senate, contained in Friday's TDN.

The sponsor of the Senate resolution was Damon Thayer, who commented upon what he felt was a need for the review.

“While I support the HISA goals of uniformity and standardization of racing rules, its implementation so far has been less than inspiring and it may still be ruled unconstitutional,” said Thayer in a text. “Now HISA is trying to force a funding model that is unfair to Kentucky racing and potentially taxpayers with an unfunded mandate the punishes us for our success. I do not support this approach and this Resolution, which passed unanimously in the House and Senate, memorializes that and urges consideration of a different formula. At best, HISA should be funded with an annual federal government appropriation, but at the very least should not have a funding model that is punitive to successful racing states like Kentucky.”

A statement from Rick Hiles, the Kentucky Horsemen's Benevolent and Protective Association (HBPA) president, read:

“We applaud the Kentucky Senate, led by sponsors Majority Floor Leader Damon Thayer and John Schickel, and the Kentucky House of Representatives, with Reps. Matt Koch and Al Gentry the sponsors, for their resolution that raises many of the concerns we have about the Horseracing Integrity and Safety Act and the private Authority corporation it created and granted broad powers.

“No matter the inflammatory rhetoric slung at the National HBPA, the resolution–which passed unanimously in both the Senate and House on Thursday–shows that reasonable persons understand that HISA was rushed into existence with a flawed process. They understand our stated concerns about unintended consequences that could devastate portions of our industry across the country, including Kentucky.

“It's gratifying to have leadership that understands that the HISA challenge by the National HBPA, many of its affiliates including Kentucky, the United States Trotting Association, several state racing commissions and attorneys generals and others is because we all want our industry to be strong and to do better and better. All these parties are in complete support of measures that promote integrity, uniformity and fair racing but this must be accomplished only through lawful, accountable and transparent means.

“Prominent in the resolution is the very real threat that the financial structure set up by this unfunded mandate will jeopardize small and medium-sized tracks and smaller stables. That in turn will have a huge impact on Kentucky's breeding and racing industries, as well as the agribusiness that is fueled by horse racing.

“Kentucky is blessed to have legislative leadership such as Senators Thayer and Schickel and Representatives Koch and Gentry, among others, who understand our industry, its complexities and appreciate that racing in Kentucky and elsewhere has many levels that contribute to the entire ecosystem. To destabilize parts of it, we believe, will have unintended consequences to all involved in the industry from top to bottom.”

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Gray Machines Pose Major Threat to Kentucky’s HHR, Horse Racing

by Sara Gordon and Katie Petrunyak

Many of the nearly 250 people attending the Kentucky Thoroughbred Farm Managers Club's (KTFMC) monthly meeting, held Tuesday evening at the Keeneland sales pavilion, were unfamiliar with the unregulated and untaxed gaming machines known as “gray machines.”

The risk these gray machines pose to historical horse racing (HHR) gaming and the state's horse racing industry as a whole were the main topic of the meeting that included a discussion and Q and A session of Central Kentucky legislators. In a panel moderated by the Kentucky Equine Education Project (KEEP)'s executive director Will Glasscock, Senator Amanda Mays Bledsoe (Republican, Lexington), Representative Matt Koch (Republican, Paris), Senator Damon Thayer (Republican, Georgetown) and Senator Reginald Thomas (Democrat, Lexington, minority caucus chair) shared their opposition toward the expansion of gray machines in Kentucky.

“We have not forgotten what the legislature did for us in 2021,” Keeneland President and CEO Shannon Arvin recalled of the passing of SB 120, which continued the operation of HHR gaming, in her opening comments for the meeting. “We have to pay attention to what goes on in Frankfort. We can't just live in our own little world.”

The lawmakers on the panel introduced the growing issue of gray machines, which resemble slot machines but do not qualify as a legalized form of gaming in Kentucky as there is no oversight to their use. These machines, which are marketed as games of skill, are typically located in establishments such as gas stations, convenience stores and bars.

“They are illegal casino games,” explained Sen. Thayer, the Senate Majority Floor Leader. “The proprietors have a business model where they come into a state where there's a gray area in the law, they pay a lawyer to get a friendly opinion that says, 'Yeah, they're really legal.' And then they come in and try to get integrated in local communities.”

The meeting's legislators noted how there is currently no exact count of how many machines are in Kentucky because the machines are not required to be registered or tracked, but it is believed that there are already thousands in use and that their numbers are growing in every county across the Commonwealth.

Rep. Koch explained how the expansion of gray machines poses a major threat to the horse racing industry. While the majority of the revenue from these machines go to out-of-state gaming companies, revenue from HHR goes to support the state's signature industry: horse racing. He said that if gray machines remain, they could cripple the industry and decimate the jobs within it.

“It's going to end HHR. I don't think that's the type of gambling that Kentucky wants to see,” said Rep. Koch.

The panelists explained how these gray machines could also affect the communities they reside in, particularly when it comes to their impact on youth. Since the machines are unregulated, the lack of supervision creates the opportunity for minors to participate.

“You don't want to introduce [teenagers] to gaming at that age. That invites other sorts of bad actions. Keep them away from gaming and illegal activities, because one illegal activity begets another,” said Sen. Thomas.

Thayer said that other states are also working to confront the issues of gray machines. In Virginia, they have been the focus of 150 lawsuits, and in Pennsylvania, they were initially legalized but are now facing issues concerning a legal and regulatory gray area.

During the Q and A, attendees asked for further details regarding where gray machines come from and the entities behind them.

Legislators described how Pace-O-Matic and Prominent Technologies first brought the machines to Kentucky in 2021. The issue of their existence in the state was brought to the floor last year, where the legislature nearly outlawed them, but the House and Senate ultimately could not agree on the bill, so the effort fell short.

Representative Killian Timoney, the sponsor of last year's bill, was present at Tuesday's meeting and said that he will be filing similar legislation this week. Once submitted, it could take up to two to three weeks for a decision to be made as it moves through the legislative system.

The panel emphasized that now is the time for industry participants to reach out to their senators and representatives to help sway votes towards banning the use of gray machines in Kentucky.

“If you want to preserve this industry and see it continue to grow, you need to be ready to reach out,” said Rep. Thayer. “If it doesn't happen now, it will be harder next year as [gray machines] continue to expand like a bad virus.”

Glasscock shared details about the upcoming KEEP Day at the Capitol, set for this Thursday, Feb. 23, which provides members of Kentucky's equine industry and community an opportunity to share with legislators in Frankfort the importance of horses to their districts and to the state's economy. (Click here for more).

“We are on the ropes with this one,” said Rep. Timoney. “I don't know if you all can afford to not send someone to KEEP Day. The horse industry needs to be well-represented on Thursday. It's a signature industry and we need to protect it.

Koch further encouraged industry members to keep the conversation going with their representatives and senators–not only in their districts but across the entire state–concerning the importance of HHR, its impact on racing, breeding and sales and its overall significance to the state's economy.

“We need to spread a positive message of HHR. We're two years into this and it's doing great things for Kentucky. [We need to] reinforce to legislators not to strip that away.”

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Even Marines Need a Hero

by Matt Koch

Editor's Note: In honor of Veterans Day and the 247th birthday of the United States Marine Corps (USMC), celebrated Nov. 11 and Nov. 10, respectively, we are honored to share this story from USMC Captain Matt Koch of Shawhan Place, a second-generation Marine following his father, longtime Claiborne Farm manager Robert “Gus” Koch. Matt, who will be honored next month as the 2022 Ted Bates Farm Manager of the Year by the Kentucky Thoroughbred Farm Managers' Club (KTFMC), is also the state representative of the 72nd district (Bourbon, Nicholas, and Fleming Counties).

Even Marines need a hero. Mine is David Pope. David is quiet, he goes to church every Sunday, and he works for a Thoroughbred farm in Bourbon County. His wife Kym works at the local extension office, and to put it simply, they are just good people. Good people who have done something extraordinary. David stepped up and donated a kidney to a man in another state whom he had never met. I don't think I can tell this story without first starting with my father's journey.

My father received his final orders last year after a long, hard fight with kidney cancer. USMC Sergeant Gus Koch proudly served in Vietnam from 1966-67. Thirty years later, he was diagnosed with kidney cancer and that started the fight that continued for the next 25 years. Whether it was the Agent Orange or the drinking water at Camp Lejeune, we don't know for sure. Dad had a kidney removed, faced multiple rounds of chemo, had brain tumors and stomach tumors. We moved up countless family weddings and anniversary celebrations because doctors told us Dad wouldn't make it six more months. The Marine in him wouldn't stop. He saw all 10 of his children graduate college, get married, and start families.

It wasn't long after Dad passed away that I learned the story of one of my Marines from Afghanistan. Corporal Chris Kilpatrick and I worked in the S-2 (intelligence) shop together. On Oct. 31, 2019, Chris had been diagnosed with Polycystic Kidney Disease (PKD). He was in end-stage renal failure and in urgent need of a transplant.

PKD is normally an inherited disease, but in this case, it was due to the toxic exposures to the burn pits which we were exposed to in Iraq and Afghanistan. There is no cure, and the only option is a kidney transplant.

Chris's story hit me pretty hard. I started the donation process. Many others also started the process and were weeded out. In January, 2022 I shared the post about Chris on Facebook. I didn't say anything about Dad or the back story. Unbeknownst to me, a friend of my father, David Pope, saw the post and felt the call to action. Just a month prior, while attending Christmas Eve mass with his family in Ohio, David had heard a sermon about giving of yourself. He prayed for an opportunity that he may have that chance. The Popes didn't realize that something would come along so soon. When David and Kym saw the Facebook post they thought maybe they should give it a try, with the thought that there was no way he would match. He started the process and passed stage 1. He continued the journey and passed again.

David ended up being such a good match that the doctors said it was almost like they were brothers. He traveled several times from Kentucky to Florida for a man he never met and to make a major life decision. He was going to give Chris a kidney.

When David called to tell me he was going to be the donor, I shed a few tears. You see, he had been friends with my father. They shared common bonds of being in the horse industry and served in the Knights of Columbus together at the Church of the Annunciation in Paris. He didn't know that Dad's cancer was service related.

Far too often veterans believe we live on an island. We can rest easy knowing that good men and women like David Pope have our backs. David, we salute you for having our backs when times were bad. Gunny Brossette, our Intel Shop Staff NCO (Noncommissioned Officer), said it best: “David, although you were never in uniform, you saved the life of one of our Marines and that, sir, makes you one of us for life.”

David and Chris are both recovering and doing well.

Happy Birthday, Marines!

Semper Fi, David.

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Matthew Koch Named KY Farm Manager of the Year

The Kentucky Thoroughbred Farm Managers' Club (KTFMC) has chosen Shawhan Place's Matthew Koch as the 2022 Ted Bates Farm Manager of the Year. The honor is given annually to a farm manager “who has demonstrated quality and success in their management role; service to the community; involvement in the KTFMC; and industry leadership and dedication.”

“I am thrilled to hear Matthew has won this prestigious award,” said Teddy Kuster, co-owner of Shawhan Place and the 1986 KTFMC Farm Manager of the Year. “The club has meant a lot to Matt's entire family and all of us at Shawhan Place. Matt is a wonderful individual who wears many hats. He's a farm manager working in the trenches and has given back to his community by serving on several boards. He serves as State Representative for 72nd District (Bourbon, Nicholas, and Fleming County) and was instrumental in passing HHR for the industry… Even more important than raising horses, Matthew raises the next generation of young horsemen and women. He is a mentor to many and regularly hosts interns from both KEMI and the University of Kentucky.”

A graduate of both the University of Kentucky and the Kentucky Horseshoeing School, Koch is also a former United States Marine captain and served his country in Afghanistan and Kosovo. In 2006, Koch and Kuster formed Shawhan Place, which now breeds about 100 mares a year.

Among the boards Koch has served on are Kentucky Equine Management Internship (KEMI), the Consignors and Commercial Breeders Association (CBA), and the Kentucky Thoroughbred Association (KTA). He has previously been the president, vice-president, director, and treasurer of the KTFMC.

Koch is a second-generation KTFMC Farm Manager of the Year, as his late father, Gus Koch, was awarded the title in 2004. The pair join B.G. Hughes and Scooter Hughes as the only father/son recipients of the award. Koch currently resides in Bourbon County with his wife, Kristen, and their three children Taylor, Jack, and Nate.

The KTFMC will be hosting its annual dinner dance to honor Koch at The Carrick House in Lexington Dec. 2. A silent auction will be held with all proceeds benefitting The Horse Farm Workers' Educational Assistance Fund. Tickets and sponsorships for the event will be available for purchase at ktfmc.org later this month.

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