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AN ACT relating to equine within Kentucky. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
Section 1. KRS 138.510 is amended to read as follows: 3
(1) (a) Before August 1, 2022, except as provided in paragraph (e) of this subsection 4
and subsection (3) of this section, an excise tax is imposed on all tracks 5
conducting pari-mutuel wagering on live racing under the jurisdiction of the 6
commission as follows: 7
1. For each track with a daily average live handle of one million two 8
hundred thousand dollars ($1,200,000) or above, the tax shall be in the 9
amount of three and one-half percent (3.5%) of all money wagered on 10
live races at the track during the fiscal year; and 11
2. For each track with a daily average live handle under one million two 12
hundred thousand dollars ($1,200,000), the tax shall be one and one-half 13
percent (1.5%) of all money wagered on live races at the track during 14
the fiscal year. 15
(b) Beginning August 1, 2022, the excise tax imposed on all tracks conducting 16
pari-mutuel wagering on live racing under jurisdiction of the commission 17
shall be one and one-half percent (1.5%) of all money wagered on live races 18
at the track during the fiscal year. 19
(c) Beginning on April 1, 2014, an excise tax is imposed on all tracks conducting 20
pari-mutuel wagering on historical horse races under the jurisdiction of the 21
commission at a rate of one and one-half percent (1.5%) of all money wagered 22
on historical horse races at the track during the fiscal year. 23
(d) Money shall be deducted from the tax paid under paragraphs (a), (b), and (c) 24
of this subsection and deposited as follows: 25
1. a. Before August 1, 2022, an amount equal to three-quarters of one 26
percent (0.75%) of all money wagered on live races and historical 27 UNOFFICIAL COPY 23 RS BR 927
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horse races at the track for Thoroughbred racing shall be deposited 1
in the Thoroughbred development fund established in KRS 2
230.400; and 3
b. Beginning August 1, 2022, an amount equal to three-quarters of 4
one percent (0.75%) of all money wagered on live races and 5
historical horse races at the track for Thoroughbred racing shall be 6
deposited in the Thoroughbred development fund established in 7
KRS 230.400 until forty-five million dollars ($45,000,000) has 8
been deposited during a fiscal year, at which point the amount 9
deposited in the fund shall decrease to four-tenths of one percent 10
(0.4%) of all money wagered on live and historical horse races at 11
the track for Thoroughbred racing for the remainder of the fiscal 12
year; 13
2. a. Before August 1, 2022, an amount equal to one percent (1%) of all 14
money wagered on live races and historical horse races at the track 15
for harness racing shall be deposited in the Kentucky standardbred 16
development fund established in KRS 230.770. Beginning August 17
1, 2022, an amount equal to one percent (1%) of all money 18
wagered on live races at the track for harness racing shall be 19
deposited in the Kentucky standardbred development fund until a 20
total of twenty million dollars ($20,000,000) has been deposited 21
during a fiscal year from this subparagraph, at which point the 22
amount deposited shall decrease to four-tenths of one percent 23
(0.4%) of all money wagered for the remainder of the fiscal year; 24
and 25
b. Beginning August 1, 2022, an amount equal to one percent (1%) 26
of all money wagered on historical horse races at the track for 27 UNOFFICIAL COPY 23 RS BR 927
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harness racing shall be distributed in the exact amounts based 1
upon contracts between the parties that have been filed with the 2
commission, but at least one-half (1/2) of the funds shall be 3
deposited into the Kentucky standardbred development fund 4
established in KRS 230.770 until a total of twenty million dollars 5
($20,000,000) has been deposited into the Kentucky standardbred 6
development fund during a fiscal year from this subparagraph, at 7
which point the amount deposited in this subdivision shall 8
decrease to four-tenths of one percent (0.4%) of all money 9
wagered for the remainder of the fiscal year. The commission shall 10
provide the department all information necessary from the 11
contracts in order for the funds in this subparagraph to be 12
distributed; 13
3. An amount equal to one percent (1%) of all money wagered on live 14
races and historical horse races at the track for quarter horse, paint 15
horse, Appaloosa, and Arabian horse racing shall be deposited in the 16
Kentucky quarter horse, paint horse, Appaloosa, and Arabian 17
development fund established by KRS 230.445; 18
4. An amount equal to two-tenths of one percent (0.2%) of all money 19
wagered on live races and historical horse races at the track shall be paid 20
out in equal amounts as follows: 21
a. To the equine industry program trust and revolving fund 22
established by KRS 230.550 to support the Equine Industry 23
Program at the University of Louisville, except that the amount 24
deposited from money wagered on historical horse races in any 25
fiscal year shall not exceed eight hundred fifty thousand dollars 26
($850,000); 27 UNOFFICIAL COPY 23 RS BR 927
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b. To the University of Kentucky for equine industry programs at the 1
university, except that the amount paid from money wagered on 2
historical horse races in any fiscal year shall not exceed four 3
hundred thousand dollars ($400,000); 4
c. To the Bluegrass Community and Technical College for the 5
provision of equine industry programs by the system, except that 6
the amount paid from money wagered on historical horse races in 7
any fiscal year shall not exceed two hundred fifty thousand dollars 8
($250,000); 9
d. Amounts remaining from money wagered on historical horse races 10
in a fiscal year after payments are made in accordance with 11
subdivisions a., b., and c. of this subparagraph shall be distributed 12
in equal amounts to: 13
i. The Kentucky Thoroughbred breeders incentive fund 14
established in KRS 230.800, in an amount not to exceed four 15
hundred thousand dollars ($400,000); and 16
ii. The Kentucky standardbred breeders incentive fund 17
established in KRS 230.802, in an amount not to exceed one 18
hundred thousand dollars ($100,000); and 19
e. Any amounts remaining from money wagered on historical horse 20
races in a fiscal year after payments are made in accordance with 21
subdivisions a., b., c., and d. of this subparagraph shall be paid to 22
the general fund; 23
5. a. An amount equal to one-tenth of one percent (0.1%) of all money 24
wagered on live races and historical horse races at the track shall 25
be deposited in a trust and revolving fund to be used for the 26
construction, expansion, or renovation of facilities or the purchase 27 UNOFFICIAL COPY 23 RS BR 927
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of equipment for equine programs at state universities, except that 1
the amount deposited from money wagered on historical horse 2
races in any fiscal year shall not exceed three hundred twenty 3
thousand dollars ($320,000). 4
b. These funds shall not be used for salaries or for operating funds 5
for teaching, research, or administration. Funds allocated under 6
this subparagraph shall not replace other funds for capital purposes 7
or operation of equine programs at state universities. 8
c. The Kentucky Council on Postsecondary Education shall serve as 9
the administrative agent and shall establish an advisory committee 10
of interested parties, including all universities with established 11
equine programs, to evaluate proposals and make 12
recommendations for the awarding of funds. 13
d. The Kentucky Council on Postsecondary Education may 14
promulgate administrative regulations to establish procedures for 15
administering the program and criteria for evaluating and awarding 16
grants; and 17
6. An amount equal to one-tenth of one percent (0.1%) of all money 18
wagered on live races and historical horse races shall be distributed to 19
the commission to support equine drug testing as provided in KRS 20
230.265(3), except that the amount deposited from money wagered on 21
historical horse races in any fiscal year shall not exceed three hundred 22
twenty thousand dollars ($320,000). 23
(e) The excise tax imposed by paragraphs (a) and (b) of this subsection shall not 24
apply to pari-mutuel wagering on live harness racing at a county fair. 25
(2) (a) Except as provided in paragraph (c) of this subsection, an excise tax is 26
imposed on: 27 UNOFFICIAL COPY 23 RS BR 927
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1. All tracks conducting telephone account wagering; 1
2. All tracks participating as receiving tracks in intertrack wagering under 2
the jurisdiction of the commission; and 3
3. All tracks participating as receiving tracks displaying simulcasts and 4
conducting interstate wagering thereon. 5
(b) 1. Before August 1, 2022, the tax shall be three percent (3%) of all money 6
wagered on races as provided in paragraph (a) of this subsection during 7
the fiscal year. 8
2. Beginning August 1, 2022, the tax shall be one and one-half percent 9
(1.5%) of all money wagered on races as provided in paragraph (a) of 10
this subsection during the fiscal year. 11
(c) A noncontiguous track facility approved by the commission on or after 12
January 1, 1999, shall be exempt from the tax imposed under this subsection, 13
if the facility is established and operated by a licensed track which has a total 14
annual handle on live racing of two hundred fifty thousand dollars ($250,000) 15
or less. The amount of money exempted under this paragraph shall be retained 16
by the noncontiguous track facility, KRS 230.3771 and 230.378 17
notwithstanding. 18
(d) Money shall be deducted from the tax paid under paragraphs (a) and (b) of 19
this subsection as follows: 20
1. An amount equal to one percent (1%) of the amount wagered shall be 21
deposited as follows: 22
a. In the Thoroughbred development fund established in KRS 23
230.400 if the host track is conducting a Thoroughbred race 24
meeting or the interstate wagering is conducted on a Thoroughbred 25
race meeting; 26
b. In the Kentucky standardbred development fund established in 27 UNOFFICIAL COPY 23 RS BR 927
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KRS 230.770, if the host track is conducting a harness race 1
meeting or the interstate wagering is conducted on a harness race 2
meeting; or 3
c. In the Kentucky quarter horse, paint horse, Appaloosa, and 4
Arabian development fund established by KRS 230.445, if the host 5
track is conducting a quarter horse, paint horse, Appaloosa, or 6
Arabian horse race meeting or the interstate wagering is conducted 7
on a quarter horse, paint horse, Appaloosa, or Arabian horse race 8
meeting; 9
2. An amount equal to twenty-five thousandths of one percent (0.025%) of 10
the amount wagered shall be allocated to the equine industry program 11
trust and revolving fund established by KRS 230.550 to be used to 12
support the Equine Industry Program at the University of Louisville; 13
3. An amount equal to one-twentieth of one percent (0.05%) of the amount 14
wagered shall be deposited in a trust and revolving fund to be used for 15
the construction, expansion, or renovation of facilities or the purchase of 16
equipment for equine programs at state universities, as detailed in 17
subsection (1)(d)5. of this section; and 18
4. An amount equal to one-twentieth of one percent (0.05%) of the amount 19
wagered shall be distributed to the commission to support equine drug 20
testing as provided in KRS 230.265(3). 21
(3) If a host track in this state is the location for the conduct of a two (2) day 22
international horse racing event that distributes in excess of a total of twenty million 23
dollars ($20,000,000) in purses and awards: 24
(a) The excise tax imposed by subsection (1)(a) and (b) of this section shall not 25
apply to money wagered at the track on live races conducted at the track 26
during the two (2) day international horse racing event;[ and] 27 UNOFFICIAL COPY 23 RS BR 927
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(b) Amounts wagered at the track on live races conducted at the track during the 1
two (2) day international horse racing event shall not be included in 2
calculating the daily average live handle for purposes of subsection (1) of this 3
section; and 4
(c) The Tourism, Arts and Heritage Cabinet shall be granted a race title 5
sponsorship and promotional package at the two (2) day international horse 6
racing event with all usual and customary benefits assigned to promote 7
Kentucky tourism. The Tourism, Arts and Heritage Cabinet shall not be 8
charged any fees for the promotional package. 9
(4) If a host track in this state is the location for an international harness racing 10
event spanning over multiple days and distributing at least five million dollars 11
($5,000,000), the Tourism, Arts and Heritage Cabinet shall be granted a race title 12
sponsorship and promotional package at the international harness racing event 13
with all usual and customary benefits assigned to promote Kentucky tourism. The 14
Tourism, Arts and Heritage Cabinet shall not be charged any fees for the 15
promotional package. 16
(5)[(4)] The taxes imposed by this section shall be paid, collected, and administered as 17
provided in KRS 138.530. 18
Section 2. KRS 230.770 is amended to read as follows: 19
(1) There is hereby created a trust and revolving fund for the Kentucky Horse Racing 20
Commission, designated as the Kentucky standardbred development fund, 21
consisting of money allocated to the fund under the provisions of KRS 138.510, 22
together with any other money contributed to or allocated to the fund from all other 23
sources. For the purposes of this section, "development fund" or "fund" means the 24
Kentucky standardbred development fund. Money to the credit of the development 25
fund shall be distributed by the Treasurer for the purposes provided in this section, 26
upon authorization of the Kentucky Horse Racing Commission and upon approval 27 UNOFFICIAL COPY 23 RS BR 927
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of the secretary of the Finance and Administration Cabinet. Money to the credit of 1
the fund at the end of each fiscal year shall not lapse but shall be carried forward in 2
the fund to the succeeding fiscal year. 3
(2) The Kentucky Horse Racing Commission shall use the development fund to 4
promote races, and to provide purses for races, for Kentucky-bred standardbred 5
horses. 6
(3) The racing commission shall provide for distribution of money to the credit of the 7
development fund to persons, corporations, or associations operating licensed 8
standardbred race tracks within Kentucky on an equitable basis, for the purpose of 9
conducting separate races for Kentucky-bred standardbred horses, both trotting and 10
pacing. 11
(4) Money distributed from the development fund: 12
(a) To licensed standardbred race tracks within the Commonwealth shall be used 13
exclusively to promote races and provide purses for races conditioned to 14
admit [only ]Kentucky-bred standardbred horses; 15
(b) In the amount of one million dollars ($1,000,000) shall be allocated to a 16
Kentucky track hosting an international harness racing event spanning over 17
multiple days and distributing at least five million dollars ($5,000,000); and 18
(c) In an amount not to exceed two million dollars ($2,000,000) may be 19
allocated to fund overnight purses. 20
(5) The Kentucky Horse Racing Commission shall fix the amount of money to be paid 21
from the development fund to be added to the purse provided for each race by the 22
licensed operator of the track; shall fix the dates and conditions of races to be held 23
by licensed race tracks; and shall promulgate administrative regulations necessary 24
to carry out the provisions of this section. 25
(6) The Kentucky Horse Racing Commission may promulgate admin istrative 26
regulations necessary to determine the eligibility of horses for entry in races for 27 UNOFFICIAL COPY 23 RS BR 927
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which a portion of the purse is provided by money of the development fund, 1
including administrative regulations for the eligibility, residency, and registration of 2
mares, stallions, and progeny thereof. Registration of stallions may occur any time 3
during the breeding season, but shall occur no later than December 31 of the year of 4
conception of the eligible horse. 5
(7) The Kentucky Horse Racing Commission shall appoint qualified personnel 6
necessary to supervise registration of, or determination of eligibility of, horses 7
entitled to entry in races, a portion of the purse of which is provided by the 8
development fund, to assist the racing commission in determining the conditions, 9
class, and quality of the fund supported race program to be established hereunder so 10
as to carry out the purposes of this section. These persons shall serve at the pleasure 11
of the racing commission and compensation shall be fixed by the racing 12
commission. The compensation of personnel and necessary expenses shall be paid 13
out of the development fund. The racing commission shall promulgate 14
administrative regulations to carry out the provisions of this section, and shall 15
administer the Kentucky sire stakes program created hereby in a manner best 16
designed to promote and aid in the development of the horse industry in Kentucky; 17
to upgrade the quality of racing in Kentucky; and to improve the quality of horses 18
bred in Kentucky. 19