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AN ACT relating to the partial distribution of pari-mutuel racing tax receipts to 1
local governments and making an appropriation therefor. 2
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 3
Section 1. KRS 138.510 is amended to read as follows: 4
(1) (a) Before August 1, 2022, except as provided in paragraph (e) of this subsection 5
and subsection (3) of this section, an excise tax is imposed on all tracks 6
conducting pari-mutuel wagering on live racing under the jurisdiction of the 7
commission as follows: 8
1. For each track with a daily average live handle of one million two 9
hundred thousand dollars ($1,200,000) or above, the tax shall be in the 10
amount of three and one-half percent (3.5%) of all money wagered on 11
live races at the track during the fiscal year; and 12
2. For each track with a daily average live handle under one million two 13
hundred thousand dollars ($1,200,000), the tax shall be one and one-half 14
percent (1.5%) of all money wagered on live races at the track during 15
the fiscal year. 16
(b) Beginning August 1, 2022, the excise tax imposed on all tracks conducting 17
pari-mutuel wagering on live racing under jurisdiction of the commission 18
shall be one and one-half percent (1.5%) of all money wagered on live races 19
at the track during the fiscal year. 20
(c) Beginning on April 1, 2014, an excise tax is imposed on all tracks conducting 21
pari-mutuel wagering on historical horse races under the jurisdiction of the 22
commission at a rate of one and one-half percent (1.5%) of all money wagered 23
on historical horse races at the track during the fiscal year. 24
(d) Money shall be deducted from the tax paid under paragraphs (a), (b), and (c) 25
of this subsection and deposited as follows: 26
1. a. Before August 1, 2022, an amount equal to three-quarters of one 27 UNOFFICIAL COPY 23 RS BR 1620
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percent (0.75%) of all money wagered on live races and historical 1
horse races at the track for Thoroughbred racing shall be deposited 2
in the Thoroughbred development fund established in KRS 3
230.400; and 4
b. Beginning August 1, 2022, an amount equal to three-quarters of 5
one percent (0.75%) of all money wagered on live races and 6
historical horse races at the track for Thoroughbred racing shall be 7
deposited in the Thoroughbred development fund established in 8
KRS 230.400 until forty-five million dollars ($45,000,000) has 9
been deposited during a fiscal year, at which point the amount 10
deposited in the fund shall decrease to four-tenths of one percent 11
(0.4%) of all money wagered on live and historical horse races at 12
the track for Thoroughbred racing for the remainder of the fiscal 13
year; 14
2. a. Before August 1, 2022, an amount equal to one percent (1%) of all 15
money wagered on live races and historical horse races at the track 16
for harness racing shall be deposited in the Kentucky standardbred 17
development fund established in KRS 230.770. Beginning August 18
1, 2022, an amount equal to one percent (1%) of all money 19
wagered on live races at the track for harness racing shall be 20
deposited in the Kentucky standardbred development fund until a 21
total of twenty million dollars ($20,000,000) has been deposited 22
during a fiscal year from this subparagraph, at which point the 23
amount deposited shall decrease to four-tenths of one percent 24
(0.4%) of all money wagered for the remainder of the fiscal year; 25
and 26
b. Beginning August 1, 2022, an amount equal to one percent (1%) 27 UNOFFICIAL COPY 23 RS BR 1620
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of all money wagered on historical horse races at the track for 1
harness racing shall be distributed in the exact amounts based 2
upon contracts between the parties that have been filed with the 3
commission, but at least one-half (1/2) of the funds shall be 4
deposited into the Kentucky standardbred development fund 5
established in KRS 230.770 until a total of twenty million dollars 6
($20,000,000) has been deposited into the Kentucky standardbred 7
development fund during a fiscal year from this subparagraph, at 8
which point the amount deposited in this subdivision shall 9
decrease to four-tenths of one percent (0.4%) of all money 10
wagered for the remainder of the fiscal year. The commission shall 11
provide the department all information necessary from the 12
contracts in order for the funds in this subparagraph to be 13
distributed; 14
3. An amount equal to one percent (1%) of all money wagered on live 15
races and historical horse races at the track for quarter horse, paint 16
horse, Appaloosa, and Arabian horse racing shall be deposited in the 17
Kentucky quarter horse, paint horse, Appaloosa, and Arabian 18
development fund established by KRS 230.445; 19
4. An amount equal to two-tenths of one percent (0.2%) of all money 20
wagered on live races and historical horse races at the track shall be paid 21
out in equal amounts as follows: 22
a. To the equine industry program trust and revolving fund 23
established by KRS 230.550 to support the Equine Industry 24
Program at the University of Louisville, except that the amount 25
deposited from money wagered on historical horse races in any 26
fiscal year shall not exceed eight hundred fifty thousand dollars 27 UNOFFICIAL COPY 23 RS BR 1620
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($850,000); 1
b. To the University of Kentucky for equine industry programs at the 2
university, except that the amount paid from money wagered on 3
historical horse races in any fiscal year shall not exceed four 4
hundred thousand dollars ($400,000); 5
c. To the Bluegrass Community and Technical College for the 6
provision of equine industry programs by the system, except that 7
the amount paid from money wagered on historical horse races in 8
any fiscal year shall not exceed two hundred fifty thousand dollars 9
($250,000); 10
d. Amounts remaining from money wagered on historical horse races 11
in a fiscal year after payments are made in accordance with 12
subdivisions a., b., and c. of this subparagraph shall be distributed 13
in equal amounts to: 14
i. The Kentucky Thoroughbred breeders incentive fund 15
established in KRS 230.800, in an amount not to exceed four 16
hundred thousand dollars ($400,000); and 17
ii. The Kentucky standardbred breeders incentive fund 18
established in KRS 230.802, in an amount not to exceed one 19
hundred thousand dollars ($100,000); and 20
e. Any amounts remaining from money wagered on historical horse 21
races in a fiscal year after payments are made in accordance with 22
subdivisions a., b., c., and d. of this subparagraph shall be paid to 23
the general fund; 24
5. a. An amount equal to one-tenth of one percent (0.1%) of all money 25
wagered on live races and historical horse races at the track shall 26
be deposited in a trust and revolving fund to be used for the 27 UNOFFICIAL COPY 23 RS BR 1620
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construction, expansion, or renovation of facilities or the purchase 1
of equipment for equine programs at state universities, except that 2
the amount deposited from money wagered on historical horse 3
races in any fiscal year shall not exceed three hundred twenty 4
thousand dollars ($320,000). 5
b. These funds shall not be used for salaries or for operating funds 6
for teaching, research, or administration. Funds allocated under 7
this subparagraph shall not replace other funds for capital purposes 8
or operation of equine programs at state universities. 9
c. The Kentucky Council on Postsecondary Education shall serve as 10
the administrative agent and shall establish an advisory committee 11
of interested parties, including all universities with established 12
equine programs, to evaluate proposals and make 13
recommendations for the awarding of funds. 14
d. The Kentucky Council on Postsecondary Education may 15
promulgate administrative regulations to establish procedures for 16
administering the program and criteria for evaluating and awarding 17
grants; [and] 18
6. An amount equal to one-tenth of one percent (0.1%) of all money 19
wagered on live races and historical horse races shall be distributed to 20
the commission to support equine drug testing as provided in KRS 21
230.265(3), except that the amount deposited from money wagered on 22
historical horse races in any fiscal year shall not exceed three hundred 23
twenty thousand dollars ($320,000); and 24
7. An amount equal to one-tenth of one percent (0.1%) of all money 25
wagered on live races and historical horse races shall be distributed to 26
the fund established in Section 2 of this Act. 27 UNOFFICIAL COPY 23 RS BR 1620
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(e) The excise tax imposed by paragraphs (a) and (b) of this subsection shall not 1
apply to pari-mutuel wagering on live harness racing at a county fair. 2
(2) (a) Except as provided in paragraph (c) of this subsection, an excise tax is 3
imposed on: 4
1. All tracks conducting telephone account wagering; 5
2. All tracks participating as receiving tracks in intertrack wagering under 6
the jurisdiction of the commission; and 7
3. All tracks participating as receiving tracks displaying simulcasts and 8
conducting interstate wagering thereon. 9
(b) 1. Before August 1, 2022, the tax shall be three percent (3%) of all money 10
wagered on races as provided in paragraph (a) of this subsection during 11
the fiscal year. 12
2. Beginning August 1, 2022, the tax shall be one and one-half percent 13
(1.5%) of all money wagered on races as provided in paragraph (a) of 14
this subsection during the fiscal year. 15
(c) A noncontiguous track facility approved by the commission on or after 16
January 1, 1999, shall be exempt from the tax imposed under this subsection, 17
if the facility is established and operated by a licensed track which has a total 18
annual handle on live racing of two hundred fifty thousand dollars ($250,000) 19
or less. The amount of money exempted under this paragraph shall be retained 20
by the noncontiguous track facility, KRS 230.3771 and 230.378 21
notwithstanding. 22
(d) Money shall be deducted from the tax paid under paragraphs (a) and (b) of 23
this subsection as follows: 24
1. An amount equal to one percent (1%) of the amount wagered shall be 25
deposited as follows: 26
a. In the Thoroughbred development fund established in KRS 27 UNOFFICIAL COPY 23 RS BR 1620
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230.400 if the host track is conducting a Thoroughbred race 1
meeting or the interstate wagering is conducted on a Thoroughbred 2
race meeting; 3
b. In the Kentucky standardbred development fund established in 4
KRS 230.770, if the host track is conducting a harness race 5
meeting or the interstate wagering is conducted on a harness race 6
meeting; or 7
c. In the Kentucky quarter horse, paint horse, Appaloosa, and 8
Arabian development fund established by KRS 230.445, if the host 9
track is conducting a quarter horse, paint horse, Appaloosa, or 10
Arabian horse race meeting or the interstate wagering is conducted 11
on a quarter horse, paint horse, Appaloosa, or Arabian horse race 12
meeting; 13
2. An amount equal to twenty-five thousandths of one percent (0.025%) of 14
the amount wagered shall be allocated to the equine industry program 15
trust and revolving fund established by KRS 230.550 to be used to 16
support the Equine Industry Program at the University of Louisville; 17
3. An amount equal to one-twentieth of one percent (0.05%) of the amount 18
wagered shall be deposited in a trust and revolving fund to be used for 19
the construction, expansion, or renovation of facilities or the purchase of 20
equipment for equine programs at state universities, as detailed in 21
subsection (1)(d)5. of this section; and 22
4. An amount equal to one-twentieth of one percent (0.05%) of the amount 23
wagered shall be distributed to the commission to support equine drug 24
testing as provided in KRS 230.265(3). 25
(3) If a host track in this state is the location for the conduct of a two (2) day 26
international horse racing event that distributes in excess of a total of twenty million 27 UNOFFICIAL COPY 23 RS BR 1620
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dollars ($20,000,000) in purses and awards: 1
(a) The excise tax imposed by subsection (1)(a) and (b) of this section shall not 2
apply to money wagered at the track on live races conducted at the track 3
during the two (2) day international horse racing event; and 4
(b) Amounts wagered at the track on live races conducted at the track during the 5
two (2) day international horse racing event shall not be included in 6
calculating the daily average live handle for purposes of subsection (1) of this 7
section. 8
(4) The taxes imposed by this section shall be paid, collected, and administered as 9
provided in KRS 138.530. 10
SECTION 2. A NEW SECTION OF KRS CHAPTER 230 IS CREATED TO 11
READ AS FOLLOWS: 12
(1) The pari-mutuel racing local government support fund in the State Treasury is 13
created. This fund shall be: 14
(a) A revolving fund administered by the Department for Local Government in 15
accordance with this section; and 16
(b) Disbursed by the State Treasurer upon the warrant of the commissioner of 17
the Department for Local Government. 18
(2) This fund may receive state appropriations in accordance with the distribution 19
formula established in Section 1 of this Act. 20
(3) Notwithstanding KRS 45.229, moneys remaining in the account at the close of 21
the fiscal year shall not lapse but shall carry forward into the succeeding fiscal 22
year. Interest earned on any moneys in the fund shall accrue to the fund. 23
(4) Moneys in the fund shall be used and are appropriated to support local 24
governments in which live and historical horse racing facilities are located and as 25
specified in subsections (5) and (6) of this section. 26
(5) Local governments shall use appropriations from this fund for the policing, 27 UNOFFICIAL COPY 23 RS BR 1620
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regulation, and administration of the facilities wherein live and historical horse 1
racing facilities are located. 2
(6) The fund shall be disbursed, at least quarterly, based on the population as 3
reported in the most recent federal decennial census of the counties: 4
(a) In which the facilities were located, reported, and paid tax in the previous 5
period; 6
(b) In which the local governments of those facility locations have been 7
approved by the Department for Local Government to receive moneys from 8
the fund; and 9
(c) Based on the formula as follows: 10
1. Determine the sum of the populations of all the counties containing 11
local governments that have been approved; 12
2. Divide the population of the approved county by the sum of the 13
populations of all the counties; and 14
3. Applying the rate for each approved county, as calculated in 15
subparagraphs 1. and 2. of this paragraph, to the total amount of this 16
fund available for distribution. 17
(7) The Department for Local Government shall promulgate regulations related to: 18
(a) The requirements for qualification for distribution of the moneys from this 19
fund to local governments, which shall include: 20
1. Application and reporting requirements for local governments; 21
2. A list of eligible expenses by the local governments; and 22
3. Accountability criteria for local governments to receive moneys; and 23
(b) Distributions within the local governments, which shall include guidelines 24
for the allocation of moneys for local governments which include both cities 25
and counties. 26
(8) The Department of Revenue shall provide aggregate information to the 27 UNOFFICIAL COPY 23 RS BR 1620
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Department for Local Government pertaining to the location of the facilities, by 1
county and by city, in which pari-mutuel racing tax receipts are generated each 2
period, and other information as needed by the Department for Local 3
Government to perform the calculation detailed in subsection (6) of this section. 4
(9) For the purposes of this section, "local government" means cities, counties, 5
urban-county governments, charter county governments, consolidated local 6
governments, and unified local governments. 7
Section 3. KRS 131.190 is amended to read as follows: 8
(1) No present or former commissioner or employee of the department, present or 9
former member of a county board of assessment appeals, present or former property 10
valuation administrator or employee, present or former secretary or employee of the 11
Finance and Administration Cabinet, former secretary or employee of the Revenue 12
Cabinet, or any other person, shall intentionally and without authorization inspect 13
or divulge any information acquired by him or her of the affairs of any person, or 14
information regarding the tax schedules, returns, or reports required to be filed with 15
the department or other proper officer, or any information produced by a hearing or 16
investigation, insofar as the information may have to do with the affairs of the 17
person's business. 18
(2) The prohibition established by subsection (1) of this section shall not extend to: 19
(a) Information required in prosecutions for making false reports or returns of 20
property for taxation, or any other infraction of the tax laws; 21
(b) Any matter properly entered upon any assessment record, or in any way made 22
a matter of public record; 23
(c) Furnishing any taxpayer or his or her properly authorized agent with 24
information respecting his or her own return; 25
(d) Testimony provided by the commissioner or any employee of the department 26
in any court, or the introduction as evidence of returns or reports filed with the 27 UNOFFICIAL COPY 23 RS BR 1620
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department, in an action for violation of state or federal tax laws or in any 1
action challenging state or federal tax laws; 2
(e) Providing an owner of unmined coal, oil or gas reserves, and other mineral or 3
energy resources assessed under KRS 132.820, or owners of surface land 4
under which the unmined minerals lie, factual information about the owner's 5
property derived from third-party returns filed for that owner's property, under 6
the provisions of KRS 132.820, that is used to determine the owner's 7
assessment. This information shall be provided to the owner on a confidential 8
basis, and the owner shall be subject to the penalties provided in KRS 9
131.990(2). The third-party filer shall be given prior notice of any disclosure 10
of information to the owner that was provided by the third-party filer; 11
(f) Providing to a third-party purchaser pursuant to an order entered in a 12
foreclosure action filed in a court of competent jurisdiction, factual 13
information related to the owner or lessee of coal, oil, gas reserves, or any 14
other mineral resources assessed under KRS 132.820. The department may 15
promulgate an administrative regulation establishing a fee schedule for the 16
provision of the information described in this paragraph. Any fee imposed 17
shall not exceed the greater of the actual cost of providing the information or 18
ten dollars ($10); 19
(g) Providing information to a licensing agency, the Transportation Cabinet, or 20
the Kentucky Supreme Court under KRS 131.1817; 21
(h) Statistics of gasoline and special fuels gallonage reported to the department 22
under KRS 138.210 to 138.448; 23
(i) Providing any utility gross receipts license tax return information that is 24
necessary to administer the provisions of KRS 160.613 to 160.617 to 25
applicable school districts on a confidential basis; 26
(j) Providing the information required in Section 2 of this Act to the 27 UNOFFICIAL COPY 23 RS BR 1620
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Department for Local Government on a confidential basis for the 1
calculation of the fund distribution in that section; 2
(k) Providing documents, data, or other information to a third party pursuant to an 3
order issued by a court of competent jurisdiction; or 4
(l)[(k)] Providing information to the Legislative Research Commission under: 5
1. KRS 139.519 for purposes of the sales and use tax refund on building 6
materials used for disaster recovery; 7
2. KRS 141.436 for purposes of the energy efficiency products credits; 8
3. KRS 141.437 for purposes of the ENERGY STAR home and the 9
ENERGY STAR manufactured home credits; 10
4. KRS 141.383 for purposes of the film industry incentives; 11
5. KRS 154.26-095 for purposes of the Kentucky industrial revitalization 12
tax credits and the job assessment fees; 13
6. KRS 141.068 for purposes of the Kentucky investment fund; 14
7. KRS 141.396 for purposes of the angel investor tax credit; 15
8. KRS 141.389 for purposes of the distilled spirits credit; 16
9. KRS 141.408 for purposes of the inventory credit; 17
10. KRS 141.390 for purposes of the recycling and composting credit; 18
11. KRS 141.3841 for purposes of the selling farmer tax credit; 19
12. KRS 141.4231 for purposes of the renewable chemical production tax 20
credit; 21
13. KRS 141.524 for purposes of the Education Opportunity Account 22
Program tax credit; 23
14. KRS 141.398 for purposes of the development area tax credit; 24
15. KRS 139.516 for the purposes of the sales and use tax exemption on the 25
commercial mining of cryptocurrency; and 26
16. KRS 141.419 for purposes of the decontamination tax credit. 27 UNOFFICIAL COPY 23 RS BR 1620
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(3) The commissioner shall make available any information for official use only and on 1
a confidential basis to the proper officer, agency, board or commission of this state, 2
any Kentucky county, any Kentucky city, any other state, or the federal 3
government, under reciprocal agreements whereby the department shall receive 4
similar or useful information in return. 5
(4) Access to and inspection of information received from the Internal Revenue Service 6
is for department use only, and is restricted to tax administration purposes. 7
Information received from the Internal Revenue Service shall not be made available 8
to any other agency of state government, or any county, city, or other state, and 9
shall not be inspected intentionally and without authorization by any present 10
secretary or employee of the Finance and Administration Cabinet, commissioner or 11
employee of the department, or any other person. 12
(5) Statistics of crude oil as reported to the department under the crude oil excise tax 13
requirements of KRS Chapter 137 and statistics of natural gas production as 14
reported to the department under the natural resources severance tax requirements 15
of KRS Chapter 143A may be made public by the department by release to the 16
Energy and Environment Cabinet, Department for Natural Resources. 17
(6) Notwithstanding any provision of law to the contrary, beginning with mine-map 18
submissions for the 1989 tax year, the department may make public or divulge only 19
those portions of mine maps submitted by taxpayers to the department pursuant to 20
KRS Chapter 132 for ad valorem tax purposes that depict the boundaries of mined-21
out parcel areas. These electronic maps shall not be relied upon to determine actual 22
boundaries of mined-out parcel areas. Property boundaries contained in mine maps 23
required under KRS Chapters 350 and 352 shall not be construed to constitute land 24
surveying or boundary surveys as defined by KRS 322.010 and any administrative 25
regulations promulgated thereto. 26