Kentucky House Bill HB566 Latest Draft

                            UNOFFICIAL COPY  	25 RS BR 387 
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AN ACT relating to the Kentucky Horse Racing and Gaming Corporation and 1 
declaring an emergency. 2 
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 3 
Section 1.   KRS 230.210 is amended to read as follows: 4 
As used in this chapter, unless the context requires otherwise: 5 
(1) "Advance deposit account wagering" means a form of pari-mutuel wagering in 6 
which an individual may establish an account with a person or entity licensed by the 7 
corporation, and may place a pari-mutuel wager through that account that is 8 
permitted by law; 9 
(2) "Advance deposit account wagering licensee" means a person or entity licensed by 10 
the corporation to conduct advance deposit account wagering and accept deposits 11 
and wagers, issue a receipt or other confirmation to the account holder evidencing 12 
such deposits and wagers, and transfer credits and debits to and from accounts; 13 
(3) "Amateur youth sporting event" means any sporting event in which an individual: 14 
(a) Shall be less than eighteen (18) years of age to participate; and 15 
(b) Is prohibited, as a condition of participating in the sporting event, from 16 
receiving direct or indirect compensation for the use of the individual's 17 
athletic skill in any manner with respect to the sport in which the particular 18 
sporting event is conducted; 19 
(4) "Appaloosa race" or "Appaloosa racing" means that form of horse racing in which 20 
each horse participating in the race is registered with the Appaloosa Horse Club of 21 
Moscow, Idaho, and is mounted by a jockey; 22 
(5) "Arabian" means a horse that is registered with the Arabian Horse Registry of 23 
Denver, Colorado; 24 
(6) "Association" means any person licensed by the Kentucky Horse Racing and 25 
Gaming Corporation under KRS 230.300 and engaged in the conduct of a 26 
recognized horse race meeting; 27  UNOFFICIAL COPY  	25 RS BR 387 
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(7) "Charitable gaming" means gaming licensed by the corporation on and after July 1, 1 
2025, as authorized under this chapter and KRS Chapter 238; 2 
(8) "Corporation" means the Kentucky Horse Racing and Gaming Corporation; 3 
(9) "Geofence" means a virtual geographic boundary defined by Global Positioning 4 
System (GPS) or Radio Frequency Identification (RFID) technology; 5 
(10) "Harness race" or "harness racing" means trotting and pacing races of the 6 
standardbred horses; 7 
(11) "Horse race meeting" means horse racing run at an association licensed and 8 
regulated by the Kentucky Horse Racing and Gaming Corporation, and may include 9 
Thoroughbred, harness, Appaloosa, Arabian, paint, and quarter horse racing; 10 
(12) "Host track" means the track conducting racing and offering its racing for intertrack 11 
wagering, or, in the case of interstate wagering, means the Kentucky track 12 
conducting racing and offering simulcasts of races conducted in other states or 13 
foreign countries; 14 
(13) "Interstate wagering" means pari-mutuel wagering on simulcast horse races from a 15 
track located in another state or foreign country by patrons at a receiving track or 16 
simulcast facility; 17 
(14) "Intertrack wagering" means pari-mutuel wagering on simulcast horse races from a 18 
host track by patrons at a receiving track; 19 
(15) "Kentucky[ quarter horse,] paint horse, Appaloosa, and Arabian purse fund" means 20 
a purse fund established to receive funds as specified in KRS 230.3771 for purse 21 
programs established in KRS 230.446 to supplement purses for[ quarter horse,] 22 
paint horse, Appaloosa, and Arabian horse races. The purse program shall be 23 
administered by the Kentucky Horse Racing and Gaming Corporation; 24 
(16) "Kentucky quarter horse purse fund" means a purse fund established to receive 25 
funds as specified in Section 11 of this Act for purse programs established in 26 
Section 14 of this Act to supplement purses for quarter horse races. The purse 27  UNOFFICIAL COPY  	25 RS BR 387 
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program shall be administered by the Kentucky Horse Racing and Gaming 1 
Corporation; 2 
(17) "Kentucky resident" means: 3 
(a) An individual domiciled within this state; 4 
(b) An individual who maintains a place of abode in this state and spends, in the 5 
aggregate, more than one hundred eighty-three (183) days of the calendar year 6 
in this state; or 7 
(c) An individual who lists a Kentucky address as his or her principal place of 8 
residence when applying for an account to participate in advance deposit 9 
account wagering; 10 
(18)[(17)] "Licensed facility for sports wagering" means the designated areas to conduct 11 
sports wagering for a track licensed to conduct sports wagering pursuant to KRS 12 
230.811; 13 
(19)[(18)] "Licensed premises" means a track or simulcast facility licensed by the 14 
corporation under this chapter; 15 
(20)[(19)] "Paint horse" means a horse registered with the American Paint Horse 16 
Association of Fort Worth, Texas; 17 
(21)[(20)] "Pari-mutuel wagering," "pari-mutuel system of wagering," or "mutuel 18 
wagering" each means any method of wagering previously or hereafter approved by 19 
the corporation in which one (1) or more patrons wager on a horse race or races, 20 
whether live, simulcast, or previously run. Wagers shall be placed in one (1) or 21 
more wagering pools, and wagers on different races or sets of races may be pooled 22 
together. Patrons may establish odds or payouts, and winning patrons share in 23 
amounts wagered including any carryover amounts, plus any amounts provided by 24 
an association less any deductions required, as approved by the corporation and 25 
permitted by law. Pools may be paid out incrementally over time as approved by 26 
the corporation; 27  UNOFFICIAL COPY  	25 RS BR 387 
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(22)[(21)] "Person" means an individual, sole proprietorship, partnership, association, 1 
fiduciary, corporation, limited liability company, or any other business entity; 2 
(23)[(22)] "President" means the president of the Kentucky Horse Racing and Gaming 3 
Corporation, who shall serve as chief executive officer of the corporation; 4 
(24)[(23)] "Principal" means any of the following individuals associated with a 5 
partnership, trust, association, limited liability company, or corporation that is 6 
licensed to conduct a horse race meeting or an applicant for a license to conduct a 7 
horse race meeting: 8 
(a) The chairman and all members of the board of directors of a corporation; 9 
(b) All partners of a partnership and all participating members of a limited 10 
liability company; 11 
(c) All trustees and trust beneficiaries of an association; 12 
(d) The president or chief executive officer and all other officers, managers, and 13 
employees who have policymaking or fiduciary responsibility within the 14 
organization; 15 
(e) All stockholders or other individuals who own, hold, or control, either directly 16 
or indirectly, five percent (5%) or more of stock or financial interest in the 17 
collective organization; and 18 
(f) Any other employee, agent, guardian, personal representative, or lender or 19 
holder of indebtedness who has the power to exercise a significant influence 20 
over the applicant's or licensee's operation; 21 
(25) "Proof of wagers" includes any paper, card, certificate, token, or ticket, which 22 
indicates the details of one (1) or more pari-mutuel wagers that were placed and, 23 
if such wagers are successful, that winnings are due to the ticket holder from the 24 
track; 25 
(26)[(24)] "Quarter horse" means a horse that is registered with the American Quarter 26 
Horse Association of Amarillo, Texas; 27  UNOFFICIAL COPY  	25 RS BR 387 
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(27)[(25)] "Receiving track" means a track where simulcasts are displayed for wagering 1 
purposes. A track that submits an application for intertrack wagering shall meet all 2 
the regulatory criteria for granting an association license of the same breed as the 3 
host track, and shall have a heated and air-conditioned facility that meets all state 4 
and local life safety code requirements and seats a number of patrons at least equal 5 
to the average daily attendance for intertrack wagering on the requested breed in the 6 
county in which the track is located during the immediately preceding calendar 7 
year; 8 
(28)[(26)] "Simulcast facility" means any facility approved pursuant to KRS 230.380 to 9 
simulcast live racing and conduct pari-mutuel wagering on live racing; 10 
(29)[(27)] "Simulcasting" means the telecast of live audio and visual signals of horse 11 
races for the purpose of pari-mutuel wagering; 12 
(30)[(28)] "Sporting event" means an event at which two (2) or more persons participate 13 
in athletic contests, or an event that takes place in relation to athletic contests as 14 
approved by the corporation, but shall not include horse racing or amateur youth 15 
sports or athletic events in which the majority of participants are under the age of 16 
eighteen (18) years; 17 
(31)[(29)] "Sports governing body" means the organization, league, or association that 18 
oversees a sport, prescribes final rules, and enforces codes of conduct with respect 19 
to such sport and participants therein; 20 
(32)[(30)] "Sports wagering" means the wagering conducted under this chapter on 21 
sporting events or portions of sporting events, or on the individual performance 22 
statistics of athletes in a sporting event or combination of sporting events, in 23 
conformance with federal law and as authorized by the corporation pursuant to this 24 
chapter; 25 
(33)[(31)] "Sports wagering device": 26 
(a) Means a mechanical, electrical, or computerized contrivance, terminal, 27  UNOFFICIAL COPY  	25 RS BR 387 
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device, apparatus, software, piece of equipment, or supply approved by the 1 
corporation for conducting sports wagering under this chapter; and 2 
(b) Includes a personal computer, mobile device, or other device used in 3 
connection with sports wagering not conducted at a licensed facility for sports 4 
wagering; 5 
(34)[(32)] "Sports wagering service provider" or "service provider" means a person 6 
authorized to conduct or manage sports wagering through an agreement with a track 7 
and provide these services at a licensed facility for sports wagering, simulcast 8 
facility, or through a website or mobile interface approved by the corporation; 9 
(35)[(33)] "Telephone account wagering" means a form of pari-mutuel wagering where 10 
an individual may deposit money in an account at a track and may place a wager by 11 
direct telephone call or by communication through other electronic media owned by 12 
the holder of the account to the track; 13 
(36)[(34)] "Thoroughbred race" or "Thoroughbred racing" means a form of horse racing 14 
in which each horse participating in the race is a Thoroughbred, (i.e., meeting the 15 
requirements of and registered with The Jockey Club of New York) and is mounted 16 
by a jockey;[ and] 17 
(37)[(35)] "Track" means any association duly licensed by the Kentucky Horse Racing 18 
and Gaming Corporation to conduct horse racing and includes: 19 
(a) For facilities in operation as of 2010, the location and physical plant described 20 
in the "Commonwealth of Kentucky Initial/Renewal Application for License 21 
to Conduct Live Horse Racing, Simulcasting, and Pari-Mutuel Wagering," 22 
filed for racing to be conducted in 2010; 23 
(b) Real property of an association, if the association received or receives 24 
approval from the corporation after 2010 for a location at which live racing is 25 
to be conducted; or 26 
(c) One (1) facility or real property that is: 27  UNOFFICIAL COPY  	25 RS BR 387 
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1. Owned, leased, or purchased by an association within a sixty (60) mile 1 
radius of the association's racetrack but not contiguous to racetrack 2 
premises, upon corporation approval; and 3 
2. Not within a sixty (60) mile radius of another licensed track premise 4 
where live racing is conducted and not within a forty (40) mile radius of 5 
a simulcast facility, unless any affected track or simulcast facility agrees 6 
in writing to permit a noncontiguous facility within the protected 7 
geographic area; 8 
(38) "Unclaimed pari-mutuel winning ticket": 9 
(a) Means the proof of wager that would require payment of winnings upon 10 
submission to the track, but has been presumed abandoned under KRS 11 
Section 42 of this Act; and 12 
(b) Includes proof of wagers from live racing and simulcasting; and 13 
(39) "Unredeemed pari-mutuel voucher": 14 
(a) Means a voucher issued by a licensed track that evidences the value of 15 
funds or credits available that a patron may use for placing pari-mutuel 16 
wagers on live or previously run horse races, or which the patron may 17 
redeem for cash, but has been presumed abandoned under Section 42 of 18 
this Act; and 19 
(b) Does not include:  20 
1. Any proof of wagers or any other information related to specific 21 
wagers placed on live or historical horse racing; or  22 
2. Any vouchers that were voluntarily surrendered for donation to 23 
charity or similar purposes. 24 
Section 2.   KRS 230.215 (Effective July 1, 2025) is amended to read as follows: 25 
(1) (a) It is the policy of the Commonwealth of Kentucky, in furtherance of its 26 
responsibility to foster and to encourage legitimate occupations and industries 27  UNOFFICIAL COPY  	25 RS BR 387 
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in the Commonwealth and to promote and to conserve the public health, 1 
safety, and welfare, and it is hereby declared the intent of the Commonwealth 2 
to foster and to encourage the horse breeding industry within the 3 
Commonwealth and to encourage the improvement of the breeds of horses. 4 
(b) Further, it is the policy and intent of the Commonwealth to foster and to 5 
encourage the business of legitimate horse racing with pari-mutuel wagering 6 
thereon in the Commonwealth on the highest possible plane. Further, it hereby 7 
is declared the policy and intent of the Commonwealth that all racing not 8 
licensed under this chapter is a public nuisance and may be enjoined as such. 9 
(c) Further, it is hereby declared the policy and intent of the Commonwealth that 10 
the conduct of horse racing, or the participation in any way in horse racing, or 11 
the entrance to or presence where horse racing is conducted, is a privilege and 12 
not a personal right; and that this privilege may be granted or denied by the 13 
corporation or its duly approved representatives acting in its behalf. 14 
(d) Further, it is hereby declared the policy and intent of the Commonwealth that 15 
citizens shall be allowed to enjoy wagering on sporting events in a controlled 16 
environment that protects the citizens from cheating and fraud, and that such 17 
wagering shall be best controlled and overseen by the Kentucky Horse Racing 18 
and Gaming Corporation, which has demonstrated a long and successful 19 
history of regulating wagering. 20 
(e) Further, it is hereby declared the policy and intent of the Commonwealth that 21 
charitable gaming conducted by charitable organizations is an important 22 
method of raising funds for legitimate charitable purposes and is in the public 23 
interest. The intent of this chapter and KRS Chapter 238 is to prevent the 24 
commercialization of charitable gaming, to prevent participation in charitable 25 
gaming by criminal and other undesirable elements, and to prevent the 26 
diversion of funds from legitimate charitable purposes, and that charitable 27  UNOFFICIAL COPY  	25 RS BR 387 
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gaming shall be[ best controlled and] overseen by the Kentucky Horse Racing 1 
and Gaming Corporation. 2 
(f) It is hereby declared the intent of the Commonwealth to vest in the 3 
corporation the power to regulate the industries under its jurisdiction and 4 
ensure compliance, transparency, and protection of the public in 5 
accordance with applicable law. 6 
(2) (a) It is hereby declared the purpose and intent of this chapter in the interest of 7 
the public health, safety, and welfare, to vest in the corporation forceful 8 
control of horse racing in the Commonwealth with[ plenary] power to 9 
promulgate administrative regulations prescribing conditions under which all 10 
legitimate horse racing and wagering thereon is conducted in the 11 
Commonwealth so as to encourage the improvement of the breeds of horses in 12 
the Commonwealth, to regulate and maintain horse racing at horse race 13 
meetings in the Commonwealth of the highest quality and free of any corrupt, 14 
incompetent, dishonest, or unprincipled horse racing practices, and to regulate 15 
and maintain horse racing at race meetings in the Commonwealth so as to 16 
dissipate any cloud of association with the undesirable and maintain the 17 
appearance as well as the fact of complete honesty and integrity of horse 18 
racing in the Commonwealth. 19 
(b) In addition, it is hereby declared the purpose and intent of this chapter to vest 20 
in the corporation exclusive jurisdiction over sports wagering in the 21 
Commonwealth, with[ plenary] power to promulgate administrative 22 
regulations prescribing conditions under which all sports wagering is to be 23 
conducted. 24 
(c) In addition to the general powers and duties vested in the corporation by this 25 
chapter, it is the intent hereby to vest in the corporation the power to eject or 26 
exclude from association grounds or any part thereof any person, licensed or 27  UNOFFICIAL COPY  	25 RS BR 387 
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unlicensed, whose conduct or reputation is such that his or her presence on 1 
association grounds may, in the opinion of the corporation, reflect on the 2 
honesty and integrity of horse racing or interfere with either the orderly 3 
conduct of horse racing or the orderly conduct of sports wagering. 4 
(d) In addition, it is hereby declared the purpose and intent of this chapter to vest 5 
in the corporation exclusive jurisdiction over charitable gaming in the 6 
Commonwealth, with[ plenary] power to promulgate administrative 7 
regulations prescribing conditions under which all charitable gaming is to be 8 
conducted. 9 
(e) In addition to the general powers and duties vested in the corporation by this 10 
chapter, it is the intent hereby to vest in the corporation the power to eject or 11 
exclude from charitable gaming facilities or any part thereof any person, 12 
licensed or unlicensed, whose conduct or reputation is such that his or her 13 
presence at a charitable gaming facility may, in the opinion of the corporation, 14 
reflect on the honesty and integrity of charitable gaming or interfere with the 15 
orderly conduct of charitable gaming. 16 
Section 3.   KRS 230.225 is amended to read as follows: 17 
(1) There is hereby created and established the Kentucky Horse Racing and Gaming 18 
Corporation to regulate all forms of live horse racing, pari-mutuel wagering, sports 19 
wagering, breed integrity and development, and on and after July 1, 2025, 20 
charitable gaming, in the Commonwealth, exclusive of the state lottery established 21 
under KRS Chapter 154A. It shall be an independent, de jure municipal corporation 22 
and political subdivision of the Commonwealth of Kentucky which shall be a public 23 
body corporate and politic. The corporation shall be deemed a public agency within 24 
the meaning of KRS 61.805 and 61.870. The corporation shall be managed in such 25 
a manner that enables the people of the Commonwealth to benefit from its actions 26 
and to enjoy the best possible racing and gaming experiences. The General 27  UNOFFICIAL COPY  	25 RS BR 387 
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Assembly hereby recognizes that the operations of racing and gaming are unique 1 
activities for state government and that a corporate structure will best enable racing 2 
and gaming to be managed in a businesslike manner. It is the intent of the General 3 
Assembly that the Kentucky Horse Racing and Gaming Corporation shall be 4 
accountable to the Governor, the General Assembly, and the people of the 5 
Commonwealth. 6 
(2) (a) 1. The Auditor of Public Accounts shall perform an[ annual] audit of the 7 
corporation once every four (4) years, a copy of which shall be sent to 8 
the Governor and the Legislative Research Commission. 9 
2. A different auditing entity that is qualified to evaluate municipal 10 
corporations shall conduct an annual audit of the corporation once 11 
each year in every year when the Auditor of Public Accounts does not 12 
perform an audit. A copy of this audit shall be sent to the Governor 13 
and Legislative Research Commission. 14 
(b) The corporation shall submit a written annual report to the Governor and the 15 
Legislative Research Commission on or before July 1 of each year. The first 16 
report shall be due July 1, 2025. The corporation shall file any additional 17 
reports requested by the Governor or the Legislative Research Commission. 18 
The annual report shall include the following information: 19 
1. The receipts and disbursements of the corporation; and 20 
2. Actions taken by the corporation. 21 
(c) The corporation may submit any additional information and recommendations 22 
that the corporation considers useful or that the Governor or the Legislative 23 
Research Commission requests.  24 
(3) The Kentucky Horse Racing and Gaming Corporation shall be administered by a 25 
board of directors to regulate the conduct of: 26 
(a) Live horse racing; 27  UNOFFICIAL COPY  	25 RS BR 387 
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(b) Pari-mutuel wagering; 1 
(c) Sports wagering; 2 
(d) Charitable gaming on and after July 1, 2025; 3 
(e) Breed integrity and development; and 4 
(f) Related activities within the Commonwealth of Kentucky. 5 
(4) (a) The corporation shall establish and maintain a general office for the 6 
transaction of its business and may, in its discretion, establish a branch office 7 
or offices. 8 
(b) The corporation may hold meetings at any of its offices or at any other place 9 
at its convenience. 10 
(c) A majority of the voting members of the corporation shall constitute a quorum 11 
for the transaction of its business or exercise of any of its powers. 12 
(5) Except as otherwise provided, the corporation shall be responsible for the 13 
following: 14 
(a) Developing and implementing programs designed to ensure the safety and 15 
well-being of horses, jockeys, and drivers; 16 
(b) Developing programs and procedures that will[ aggressively] fulfill its 17 
oversight and regulatory role on such matters as medical practices and 18 
integrity issues; 19 
(c) Recommending tax incentives and implementing incentive programs to ensure 20 
the strength and growth of the equine industry; 21 
(d) Designing and implementing programs that strengthen the ties between 22 
Kentucky's horse industry and the state's universities, with the goal of 23 
significantly increasing the economic impact of the horse industry on 24 
Kentucky's economy, improving research for the purpose of promoting the 25 
enhanced health and welfare of the horse, and other related industry issues; 26 
(e) Developing and supporting programs which ensure that Kentucky remains in 27  UNOFFICIAL COPY  	25 RS BR 387 
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the forefront of equine research; 1 
(f) Designing and implementing programs that support and ensure breed integrity 2 
and development; 3 
(g) Developing monitoring programs to ensure the highest integrity of sporting 4 
events and sports wagering; 5 
(h) Developing a program to share wagering information with sports governing 6 
bodies upon which sports wagering may be conducted. The program shall be 7 
designed to assist the corporation in determining potential problems or 8 
questionable activity and provide reports to sports governing bodies 9 
effectively; 10 
(i) Developing programs and procedures that will[ aggressively] fulfill its 11 
oversight and regulatory role to ensure the highest integrity in charitable 12 
gaming; 13 
(j) Developing programs and procedures that will[ aggressively] provide 14 
oversight and regulation for all current forms of gaming and wagering;  15 
(k) Annually evaluating the allocation and use of funds among the purposes 16 
listed in Section 10 of this Act from unredeemed pari-mutuel vouchers; and 17 
(l)[(k)] Ensuring that the correct responsibilities are assigned to each of its 18 
offices as established in KRS 230.232. 19 
(6) (a) The corporation shall [: 20 
1. ]conduct all procurements in accordance with procedures which are not 21 
inconsistent with the provisions of KRS Chapter 45A and this chapter; 22 
provided, however, that this chapter shall control if and to the extent that 23 
any provision in this chapter is expressly inconsistent with any provision 24 
of KRS Chapter 45A.[; or] 25 
(b)[2.] The corporation may promulgate administrative regulations establishing 26 
its procurement procedures. If the corporation elects to promulgate 27  UNOFFICIAL COPY  	25 RS BR 387 
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administrative regulations establishing its procurement procedures rather than 1 
conduct procurements in accordance with KRS Chapter 45A, the corporation 2 
may include sections of KRS Chapter 45A as part of its administrative 3 
regulations. 4 
(c)[(b)] Major procurements for personal service contracts shall not be subject to 5 
the requirements of KRS 45A.695(2)(b) due to the unique operational 6 
activities conducted for state government by the corporation. The 7 
corporation's procurement procedures or administrative regulations shall be 8 
designed to provide for the purchase of supplies, equipment, services, and 9 
construction items that provide the greatest long-term benefit to the state and 10 
the greatest integrity for the corporation and the public. 11 
(d)[(c)] In its bidding and negotiation processes, the corporation may do its own 12 
bidding and procurement, or may utilize the services of the Finance and 13 
Administration Cabinet, or a combination thereof. The president of the 14 
corporation may, in lieu of the secretary of the Finance and Administration 15 
Cabinet, declare an emergency for purchasing purposes. 16 
(7) Corporation records shall be open and subject to public inspection in accordance 17 
with KRS 61.870 to 61.884 unless: 18 
(a) A record is exempted from inspection under KRS 61.878; 19 
(b) A record involves a trade secret or other legally protected intellectual property 20 
or confidential proprietary information of the corporation or of an applicant, 21 
licensee, individual, or entity having submitted information of such character 22 
to the corporation, in which case, the portion of the record relating to these 23 
subjects may be closed; or 24 
(c) The disclosure of the record could impair or adversely affect the operational 25 
security of the corporation in the regulation of matters within its jurisdiction 26 
or could impair or adversely impact the operational security of applicants or 27  UNOFFICIAL COPY  	25 RS BR 387 
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licensees. 1 
(8) Meetings of the corporation through its board of directors shall be open to the 2 
public in accordance with KRS 61.800 to 61.850 unless the exceptions set forth in 3 
KRS 61.810 apply or the meeting addresses trade secrets, confidential or 4 
proprietary information, or operational security issues as described in subsection 5 
(7)(c) of this section. If this is the case, the corporation may meet in closed session 6 
and shall follow the procedures set forth in KRS 61.815. 7 
(9) The corporation may participate in all state agency price contracts to the same 8 
extent as agencies of the Commonwealth in accordance with KRS 45A.050(3). 9 
(10) (a) The corporation is hereby authorized to accept and expend such moneys as 10 
may be appropriated by the General Assembly or such moneys as may be 11 
received from any source for effectuating its purposes, including without 12 
limitation the payment of the initial expenses of administration and operation 13 
of the corporation. 14 
(b) After the transfer to the corporation of any funds appropriated in fiscal year 15 
2024-2025 and fiscal year 2025-2026 for the administration of this chapter 16 
and KRS Chapter 238, the corporation shall be self-sustaining and self-funded 17 
and moneys in the state general fund shall not be used or obligated to pay the 18 
expenses of the corporation. 19 
(11)[(10)] On July 1, 2024: 20 
(a) The Kentucky Horse Racing and Gaming Corporation shall assume all 21 
responsibilities of the Kentucky Horse Racing Commission; 22 
(b) The Kentucky Horse Racing Commission shall be abolished and all 23 
employees of the Kentucky Horse Racing Commission are transferred to the 24 
corporation; and 25 
(c) All personnel, equipment, and funding shall be transferred from the Kentucky 26 
Horse Racing Commission to the Kentucky Horse Racing and Gaming 27  UNOFFICIAL COPY  	25 RS BR 387 
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Corporation. 1 
(12)[(11)] On July 1, 2025: 2 
(a) The office regulating charitable gaming in the Kentucky Horse Racing and 3 
Gaming Corporation shall assume all responsibilities of the Department of 4 
Charitable Gaming; 5 
(b) The Department of Charitable Gaming shall be abolished and all employees 6 
of the Department of Charitable Gaming are transferred to the corporation; 7 
and 8 
(c) All personnel, equipment, and funding shall be transferred from the 9 
Department of Charitable Gaming to the Kentucky Horse Racing and Gaming 10 
Corporation. 11 
(13)[(12)] Notwithstanding any other law to the contrary, nothing in this chapter or KRS 12 
Chapter 238 shall authorize the corporation to: 13 
(a) Regulate or control horse sales; 14 
(b) Require the licensure of horse breeders in their capacity as breeders;[ or] 15 
(c) Prohibit or restrict any approved, either by statute or administrative 16 
regulation, game or charitable gaming activity in use in the Commonwealth 17 
as of July 1, 2025, without action by the Kentucky General Assembly; or 18 
(d) Exercise jurisdiction over matters within the exclusive national authority of 19 
entities designated by the laws of the United States of America. 20 
Section 4.   KRS 230.227 is amended to read as follows: 21 
(1) (a) The affairs and responsibilities of the corporation shall be administered by a 22 
board of directors composed of seventeen (17)[fifteen (15)] members. All 23 
seventeen (17)[fifteen (15)] members shall be appointed by the Governor. 24 
(b) The Governor shall appoint a chair and vice chair of the board, subject to the 25 
advice and consent of the Senate. A chair or vice chair appointed when the 26 
Senate is not in session shall serve only until the next regular session, or 27  UNOFFICIAL COPY  	25 RS BR 387 
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special session if such matter is included in the call therefor of the General 1 
Assembly, at which time the chair or vice chair shall be subject to 2 
confirmation by the Senate. If the Senate is not in session, the appointments 3 
shall be subject to review by the Interim Joint Committee on State 4 
Government, which shall hold a public hearing and shall transmit its 5 
recommendations to the Senate. If the Senate refuses to confirm the chair or 6 
vice chair, then the chair or vice chair shall forfeit the office as of the date on 7 
which the Senate refuses to confirm the chair or vice chair. 8 
(c) Members of the board appointed by the Governor shall serve a term of four 9 
(4) years unless a member is removed, except the initial appointments under 10 
subsection (6)(c) of this section shall be as follows:[as otherwise provided in 11 
this section] 12 
1. Two (2) year terms shall be served by: 13 
a. The five (5) members appointed under subsection (2)(b)2., 4., 6., 14 
8., and 11.;  15 
b. Two (2) appointees under subsection (2)(b)1.; 16 
c. One (1) appointee under subsection (2)(b)5.; and 17 
d. One (1) appointee under subsection (2)(b)9.; and 18 
2. Three (3) year terms shall be served by: 19 
a. The three (3) members appointed under subsection (2)(b)3., 7., 20 
and 10.; 21 
b. One (1) appointee under subsection (2)(b)1.; 22 
c. Two (2) appointees under subsection (2)(b)5.; and 23 
d. Two (2) appointees under subsection (2)(b)9. 24 
(2) For appointments of the board of directors: 25 
(a) Any member appointed to fill a vacancy occurring other than by expiration of 26 
a term shall be appointed for the remainder of the unexpired term; and 27  UNOFFICIAL COPY  	25 RS BR 387 
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(b) In making appointments, the Governor shall appoint members who meet the 1 
following qualifications: 2 
1. Three (3) members who represent the Thoroughbred industry[: 3 
a. One (1) member shall serve a one (1) year term, with any 4 
subsequent terms lasting four (4) years; 5 
b. One (1) member shall serve a two (2) year term, with any 6 
subsequent terms lasting four (4) years; and 7 
c. One (1) member shall serve a three (3) year term, with any 8 
subsequent terms lasting four (4) years]; 9 
2. One (1) member who represents the standardbred industry; 10 
3. One (1) equine veterinarian who currently practices with race horses; 11 
4. One (1) member shall be selected based on his or her training and 12 
experience in the fields of investigation and law enforcement; 13 
5. Three (3) experts in the gaming industry, with knowledge about the 14 
technical and logistical sides of the wagering experience. At least one 15 
(1) of these experts shall have expertise in the technical and logistical 16 
sides of pari-mutuel wagering on previously run horse races; 17 
6. One (1) expert in the operational aspects of the horse industry, with 18 
particular knowledge of horse breeding; 19 
7. One (1) expert in the operational aspects of the horse industry, with 20 
particular knowledge of horse racing; 21 
8. One (1) horse trainer licensed under this chapter; 22 
9. Three (3)[Two (2)] charitable gaming representatives;[ and] 23 
10. One (1) member who represents the quarter horse industry; and 24 
11. One (1) at-large member with no financial interest in the business or 25 
industry regulated. 26 
(3) (a) A member of the board of directors, by himself or herself or through others, 27  UNOFFICIAL COPY  	25 RS BR 387 
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shall not knowingly: 1 
1. Use or attempt to use the member's influence in any manner which 2 
involves a substantial conflict between his or her personal or private 3 
interest and the member's duties to the corporation; 4 
2. Use or attempt to use any means to influence the corporation in 5 
derogation of the corporation; 6 
3. Use the member's official position or office to obtain financial gain for 7 
himself or herself, or any spouse, parent, brother, sister, or child of the 8 
director; or 9 
4. Use or attempt to use his or her official position to secure or create 10 
privileges, exemptions, advantages, or treatment for the member or 11 
others in derogation of the interests of the corporation or of the 12 
Commonwealth. 13 
(b) A director shall not appear before the board or the corporation in any manner 14 
other than as a director. 15 
(c) A director shall abstain from action on an official decision in which he or she 16 
has or may have a personal or private interest, and shall disclose the existence 17 
of that personal or private interest in writing to each other member of the 18 
board on the same day on which the director becomes aware that the interest 19 
exists or that an official decision may be under consideration by the board. 20 
This disclosure shall cause the decision on these matters to be made in a 21 
meeting of the members of the board who do not have the conflict from which 22 
meeting the director shall be absent and from all votes on which matters the 23 
director shall abstain. 24 
(d) In determining whether to abstain from action on an official decision because 25 
of a possible conflict of interest, a director shall consider the following 26 
guidelines: 27  UNOFFICIAL COPY  	25 RS BR 387 
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1. Whether a substantial threat to the director's independence of judgment 1 
has been created by his or her personal or private interest; 2 
2. The effect of the director's participation on public confidence in the 3 
integrity of the corporation and of racing and gaming; 4 
3. Whether the director's participation is likely to have any significant 5 
effect on the disposition of the matter; 6 
4. The need for the director's particular contribution, such as special 7 
knowledge of the subject matter, to the effective functioning of the 8 
corporation; and 9 
5. Whether the official decision will affect the director in a manner 10 
differently from the public, or will affect him or her as a member of a 11 
business, profession, occupation, or group to no greater extent generally 12 
than other members of the director's business, profession, occupation, or 13 
group. 14 
 Any director may request a vote of the disinterested members of the board on 15 
whether any director shall abstain from action on an official decision. 16 
(e) A director shall not knowingly disclose or use confidential information 17 
acquired in the course of his or her official duties in order to further the 18 
director's own economic interests, or those of any person. 19 
(f) A director shall not knowingly receive, directly or indirectly, any interest or 20 
profit arising from the use or loan of corporation funds or funds to be raised 21 
through the corporation. 22 
(g) A director shall not knowingly accept compensation, other than that provided 23 
in this section for directors, for performance of his or her official duties. 24 
(h) A present or former director shall not, within one (1) year following 25 
termination of the director's membership on the board, accept employment, 26 
compensation, or other economic benefit from any person or business that 27  UNOFFICIAL COPY  	25 RS BR 387 
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contracts or does business with the corporation in matters in which he or she 1 
was directly involved during the director's tenure. This provision shall not 2 
prohibit an individual from continuing in the same business, firm, occupation, 3 
or profession in which he or she was involved prior to becoming a director, 4 
provided that, for a period of one (1) year following termination of his or her 5 
position as a director, the director personally refrains from working on any 6 
matter in which the director was directly involved as a director. A director's 7 
involvement in an official decision or other action of the corporation 8 
impacting a broad class of persons or entities, and affecting the director to no 9 
greater extent generally than the members of the class, shall not prohibit the 10 
director's employment or engagement as a member of the class for any period 11 
after service as a director. 12 
(i) A director, or a spouse, child, brother, sister, or parent of that director shall 13 
not have a financial interest of more than five percent (5%) of the total value 14 
of any vendor, other supplier of goods or services to the corporation,[ 15 
retailer,] or related entity. The corporation shall provide each member of the 16 
board with a list of all current vendors, which shall be updated on at least a 17 
quarterly basis. 18 
(4) The board of directors shall[ provide the president with private-sector perspectives 19 
on the operation of a large marketing enterprise. The board shall]: 20 
(a) Approve, disapprove, amend, or modify the budget recommended by the 21 
president for the operation of the corporation; 22 
(b) Approve, disapprove, amend, or modify the terms of major procurements 23 
recommended by the president; 24 
(c)[ Serve as a board of appeal for any denial, revocation, or cancellation by the 25 
president of a contract with a retailer; 26 
(d)] Determine whether to recommend[promulgate] administrative regulations to 27  UNOFFICIAL COPY  	25 RS BR 387 
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carry out and implement its powers and duties, the operation of the 1 
corporation, the conduct of live horse racing, pari-mutuel wagering, sports 2 
wagering, breed integrity and development, and on and after July 1, 2025, 3 
charitable gaming, and any other matters necessary or desirable for the 4 
efficient and effective operation of the corporation or convenience of the 5 
public;[ and] 6 
(d)[(e)] Review the performance of the corporation and: 7 
1. Advise the president and make recommendations to him or her 8 
regarding operations of the corporation; 9 
2. Identify potential improvements in this chapter, the administrative 10 
regulations of the corporation, and the management of the corporation; 11 
and 12 
3. Request from the corporation any information the board determines to 13 
be relevant to its duties; and 14 
(e) Provide the president with private-sector perspectives on the operation of a 15 
racing and gaming enterprise. 16 
(5) In all other matters, the board shall advise and make recommendations. 17 
(6) (a) The initial members of the board shall be the members of the Kentucky Horse 18 
Racing Commission serving as of July 1, 2024. Those members shall continue 19 
to serve as board members of the corporation for two (2) additional years until 20 
July 1, 2026. The initial three (3) board members of the corporation who are 21 
charitable gaming representatives shall be appointed on or after the 22 
effective date of this section to serve until July 1, 2026.  23 
(b) Any board member vacancy that occurs between July 1, 2024, and July 1, 24 
2026, shall be filled by appointment for the remainder of that time period. An 25 
appointment of the chair or vice chair created by a vacancy between July 1, 26 
2024, and July 1, 2026, shall require confirmation of the appointment by the 27  UNOFFICIAL COPY  	25 RS BR 387 
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Senate as provided in KRS 11.160 and subsection (1) of this section. 1 
(c) Beginning on July 1, 2026, board members shall be appointed for initial and 2 
regular terms in accordance with this section. 3 
(7) (a) Members of the board shall receive no compensation for serving on the board, 4 
but shall be reimbursed for travel expenses for attending meetings and 5 
performing other official functions consistent with the reimbursement policy 6 
for state employees established by KRS 45.101 and administrative regulations 7 
promulgated thereunder. 8 
(b) The vice chair may act in the absence of the chair. 9 
(c) Before entering upon the discharge of their duties, all members of the board of 10 
directors of the Kentucky Horse Racing and Gaming Corporation shall take 11 
the constitutional oath of office. 12 
(8) (a) All persons appointed to the corporation shall be of good moral character and 13 
shall not have been convicted of, or under indictment for, a felony in 14 
Kentucky, in any other state, in federal court, or in a foreign country. 15 
(b) A board member of the corporation, or any family member of a member of 16 
the corporation, at the time of appointment or during the member's tenure on 17 
the corporation, shall not be a member of the legislature, a person holding any 18 
elective office in the state government, or any officer or official of any 19 
political party. 20 
(9) Each appointed board member of the corporation shall be required to undergo a 21 
national and state criminal background investigation. The criminal background 22 
investigation shall be by means of a fingerprint check by the Department of 23 
Kentucky State Police or equivalent state police body in the member's home state 24 
and the Federal Bureau of Investigation, pursuant to the following requirements: 25 
(a) The member shall provide his or her fingerprints to the Department of 26 
Kentucky State Police, or equivalent state police body in the member's home 27  UNOFFICIAL COPY  	25 RS BR 387 
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state, for submission to the Federal Bureau of Investigation after a state 1 
criminal background check is conducted; 2 
(b) The results of the national and state criminal background check shall be sent 3 
to the corporation; 4 
(c) The corporation shall be prohibited from releasing any criminal history record 5 
information to any private or public entity, or authorizing receipt by such 6 
private or public entity; and 7 
(d) Any fee charged by the Department of Kentucky State Police or the Federal 8 
Bureau of Investigation shall be an amount no greater than the actual cost of 9 
processing the request and conducting the background check. The corporation 10 
may charge this fee to the member. 11 
(10) (a) The Governor may remove any board member for misfeasance, malfeasance, 12 
or nonfeasance in office.  13 
(b) The removal may be made after the member has been served with a copy of 14 
the charges against him or her and the member has a public hearing, if 15 
requested. 16 
(c) The member charged may request a public hearing. The request shall be in 17 
writing and shall be submitted to the Governor's office within ten (10) days of 18 
the service of charges upon the member. 19 
(d) If a public hearing is timely requested, the hearing shall be held before a 20 
hearing officer appointed by the Governor. The hearing officer shall make 21 
findings of fact and conclusions of law based upon the record of the hearing, 22 
and shall provide the Governor with a recommendation for action. The 23 
Governor's final decision, after recommendation by the hearing officer, may 24 
be appealed to the Circuit Court of the county in which the cause of action 25 
arose. 26 
(11) Members of the board of directors shall be subject to all applicable provisions of 27  UNOFFICIAL COPY  	25 RS BR 387 
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KRS Chapter 11A, except that this chapter shall control if and to the extent that 1 
any provision in this chapter is expressly inconsistent with any provision of KRS 2 
Chapter 11A. 3 
(12) The provisions of KRS Chapters 18A and 64 shall not apply to the board, president, 4 
managers, or staff of the corporation. 5 
Section 5.   KRS 230.230 is amended to read as follows: 6 
(1) The Governor shall appoint a president, who shall act as chief executive officer of 7 
the corporation, from a list of up to three (3) names provided by the board of 8 
directors of the corporation. The president may be removed by the board of 9 
directors[shall serve at the pleasure of the Governor]. The president shall have the 10 
powers and duties described in this section and other duties directed or prescribed 11 
by the corporation. 12 
(2) The president shall be compensated at a level determined by the board. 13 
(3) The president shall have proven successful experience for a period of at least five 14 
(5) years at the management level in horse racing or gaming. 15 
(4) The president shall conduct the day-to-day operations of the corporation for the 16 
purpose of carrying out the policies and procedures of this chapter and the board. 17 
The duties of the president include but are not limited to: 18 
(a) Administering and supervising all operations of the corporation in accordance 19 
with the direction of the board and administrative regulations promulgated by 20 
the corporation[board]; 21 
(b) 1. Preparing, submitting, and recommending to the board a proposed 22 
annual[biennial] budget of the corporation covering the operations of 23 
the corporation and, upon approval, submitting the budget, financial 24 
status, and actuarial condition of the corporation to the Governor and the 25 
General Assembly for their examination; and 26 
2. With the approval of the board, amending or modifying the budget at 27  UNOFFICIAL COPY  	25 RS BR 387 
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any time in any manner deemed necessary for the proper operation of 1 
the corporation; 2 
(c) Directing and controlling all expenditures of the approved budget; 3 
(d) Recommending to the board and administering a system of personnel 4 
administration that includes benefits, grievance procedures, training, and 5 
compensation; 6 
(e) Preparing and administering fiscal, payroll, accounting, data processing, and 7 
procurement procedures for the operation of the corporation; 8 
(f) Recommending to the board bylaws and uniform procedures for the 9 
management of the corporation; 10 
(g) Within the limitations of the budget, employing necessary personnel in 11 
accordance with the personnel policies of the board; 12 
(h) Maintaining appropriate levels of property, casualty, and liability insurance as 13 
approved by the board to protect the president, managers, employees, and 14 
assets of the corporation; 15 
(i) Attending meetings of the board or appointing a designee to attend on his or 16 
her behalf; 17 
(j) Preparing annual reports of the corporation's program of work; and 18 
(k) Performing all other duties and responsibilities required by law. 19 
(5) (a) The president may hire a chief operating officer for the corporation. 20 
(b) The president shall hire a chief financial officer for the corporation, who shall: 21 
1. Have a bachelor's degree in business, accounting, finance, or other 22 
relevant field;[a. Be a certified public accountant licensed by the 23 
Commonwealth of Kentucky or by another state; or  24 
b. Be a public accountant qualified to practice public accounting 25 
under KRS Chapter 325; and] 26 
2. [a. ]Have at least ten (10)[five (5)] years of[ progressively 27  UNOFFICIAL COPY  	25 RS BR 387 
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responsible] experience working in finance and[general] accounting, 1 
with at least five (5) years in senior level management; 2 
3. Possess[ and a] comprehensive knowledge of the principles and 3 
practices of corporate finance; and[or] 4 
4.[b.] Possess the qualifications of an expert in the fields of corporate finance, 5 
auditing, general finance, gaming, or economics. 6 
(6) The president shall give an official bond in an amount and with sureties approved 7 
by the board. The premium for the bond shall be paid by the corporation. 8 
(7) Following the president's appointment[confirmation], and during his or her entire 9 
term of office, the president shall reside in Kentucky. 10 
(8) The president and the board may conduct an ongoing study of the operation and 11 
administration of racing and gaming in other states or countries, of available 12 
literature on the subject, of federal laws and regulations which may affect the 13 
operation of the corporation, and of the reaction of citizens of this state to existing 14 
or proposed racing and gaming, with a view toward implementing improvements 15 
that will tend to serve the purposes of this chapter and, on and after July 1, 2025, 16 
KRS Chapter 238. 17 
(9) The president may: 18 
(a) Require bond from corporate employees with access to corporate funds or 19 
racing or gaming funds, in an amount promulgated in the administrative 20 
regulations of the corporation[board]. The president may also require bond 21 
from other employees; and 22 
(b) For good cause, suspend, revoke, or refuse to renew any contract entered into 23 
in accordance with: 24 
1. This chapter; 25 
2. On and after July 1, 2025, KRS Chapter 238; or 26 
3. The administrative regulations of the corporation[board]. 27  UNOFFICIAL COPY  	25 RS BR 387 
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(10) The president shall be subject to all applicable provisions of KRS Chapter 11A, 1 
except that this chapter shall control if and to the extent that any provision in this 2 
chapter is expressly inconsistent with any provision of KRS Chapter 11A. 3 
Section 6.   KRS 230.232 is amended to read as follows: 4 
(1) The president of the Kentucky Horse Racing and Gaming Corporation shall 5 
establish offices within the corporation. Each office shall have specific duties 6 
assigned by the president. Topics addressed by the offices shall include but not be 7 
limited to the following: 8 
(a) Pari-mutuel wagering; 9 
(b) Live horse racing; 10 
(c) Breed development and integrity; 11 
(d) Sports wagering; 12 
(e) Licensing, compliance, and investigations; and 13 
(f) Charitable gaming. 14 
(2) Each office shall be led by an office manager, and the president shall appoint the 15 
manager of each office. 16 
(3) Each office may propose the promulgation of administrative regulations related to 17 
its area of jurisdiction, but the corporation shall have final authority to promulgate 18 
administrative regulations under this chapter and on and after July 1, 2025, final 19 
authority to promulgate administrative regulations under KRS Chapter 238. 20 
(4) The Office of Charitable Gaming shall be responsible for making formal 21 
recommendations to the president on the following matters: 22 
(a) Advancement of legal charitable gaming in the Commonwealth; 23 
(b) Recommendations to ensure the highest integrity of charitable gaming 24 
activities and that Kentucky advances lawful charitable gaming; 25 
(c) Recommending programs and policy changes to ensure the strength and 26 
growth of charitable gaming and the charitable gaming industry; and 27  UNOFFICIAL COPY  	25 RS BR 387 
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(d) Monitor and analyze charitable organizations and technology needs of the 1 
charitable gaming industry to determine how best to satisfy those needs. 2 
Section 7.   KRS 230.234 is amended to read as follows: 3 
(1) (a) Notwithstanding any provision of KRS 61.520 to the contrary, the corporation 4 
shall participate in the Kentucky Employees Retirement System effective July 5 
1, 2024, and all eligible employees shall participate in the Kentucky 6 
Employees Retirement System effective July 1, 2024. 7 
(b) Notwithstanding any provision of KRS 18A.205 to 18A.275 to the contrary, 8 
employees of the corporation shall be: 9 
1. Provided the same health insurance coverage as all other state 10 
government employees as provided in KRS 18A.225 to 18A.2287; 11 
2. Provided the same life insurance coverage provided all state employees 12 
as provided in KRS 18A.205 to 18A.220; and 13 
3. Eligible to participate in the deferred compensation system provided for 14 
all state government employees as provided in KRS 18A.230 to 15 
18A.275. 16 
(c) The Personnel Cabinet and the Kentucky Public Pensions Authority shall 17 
assist in the transfer of employees of the Kentucky Horse Racing Commission 18 
to the corporation by July 1, 2024, and the Department of Charitable Gaming 19 
to the corporation by July 1, 2025. 20 
(2) A manager or employee of the corporation shall not have a financial interest in any 21 
vendor doing business or proposing to do business with the corporation. 22 
(3)[ A manager or employee of the corporation with decision-making authority shall not 23 
participate in any decision involving a retailer with whom the manager or employee 24 
has a financial interest of five percent (5%) or more of the total value thereof. 25 
(4) A manager or employee of the corporation who leaves the employ of the 26 
corporation shall not represent any vendor, retailer, or related entity before the 27  UNOFFICIAL COPY  	25 RS BR 387 
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corporation for a period of two (2) years following termination of employment with 1 
the corporation. 2 
(5)] A background investigation shall be conducted on every applicant who has reached 3 
the final selection process prior to employment by the corporation. Applicants may 4 
be fingerprinted as a condition of employment. In addition, all office managers of 5 
the corporation and employees of the corporation performing duties primarily 6 
related to security matters, prior to employment, shall be subject to a background 7 
investigation report conducted by the Department of Kentucky State Police. The 8 
Department of Kentucky State Police shall be reimbursed by the corporation for the 9 
cost of investigations conducted pursuant to this section. A person who has been 10 
convicted of a felony, bookmaking or other forms of illegal gambling, or of a crime 11 
where dishonesty is a necessary element shall not be employed by the corporation. 12 
Any employee of the corporation who is or has been convicted of a felony, 13 
bookmaking or any other form of illegal gambling, or of a crime where dishonesty 14 
is a necessary element shall be terminated from employment by the corporation, 15 
except that this requirement shall not be interpreted to limit the right of the 16 
corporation to terminate the employment of any employee, at will, prior to any 17 
conviction. 18 
(4)[(6)] (a) Employees of the corporation shall be subject to all applicable 19 
provisions of KRS Chapter 11A, except that this chapter shall control if and 20 
to the extent that any provision in this chapter is expressly inconsistent with 21 
any provision of KRS Chapter 11A. 22 
(b) Employees of the corporation shall not be subject to the provisions of KRS 23 
Chapters 18A and 64. 24 
Section 8.   KRS 230.240 is amended to read as follows: 25 
(1) (a) [In addition to the employees referred to in KRS 230.230, ]The president of 26 
the corporation may employ, dismiss, or take other personnel action and 27  UNOFFICIAL COPY  	25 RS BR 387 
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determine the reasonable compensation of stewards,[ supervisors of mutuels, 1 
supervisors of sports wagering,] veterinarians, inspectors,[ accountants, 2 
security officers,] and persons not otherwise identified in KRS Chapter 230 3 
or 238[other employees] deemed by the president to be essential at or in 4 
connection with any horse race meeting and in the best interest of racing[, or 5 
those deemed by the president to be integral to the conduct of sports 6 
wagering]. 7 
(b) Three (3) Thoroughbred stewards shall be employed at each Thoroughbred 8 
race meeting as follows: 9 
1. Two (2) stewards shall be employed and compensated by the 10 
Commonwealth, subject to reimbursement by the racing associations 11 
pursuant to subsection (3) of this section; and 12 
2. One (1) Thoroughbred steward shall be employed and compensated by 13 
the racing association hosting the race meeting. 14 
(c) Three (3) standardbred judges shall be employed at each standardbred race 15 
meeting as follows: 16 
1. Two (2) standardbred judges shall be employed and compensated by the 17 
Commonwealth, subject to reimbursement by the racing associations 18 
pursuant to subsection (3) of this section; and 19 
2. One (1) standardbred judge shall be employed and compensated by the 20 
racing association hosting the race meeting. 21 
(d)[ The security officers shall be peace officers and conservators of the peace on 22 
corporation  property and at all race tracks and grounds in the Commonwealth 23 
and shall possess all the common law and statutory powers and privileges now 24 
available or hereafter made available to sheriffs, constables granted police 25 
powers, and police officers for the purpose of enforcing all laws relating 26 
directly or indirectly to the conduct of horse racing and pari-mutuel wagering 27  UNOFFICIAL COPY  	25 RS BR 387 
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thereon, the conduct of sports wagering, or the enforcement of laws relating to 1 
the protection of persons or property on premises licensed by the corporation. 2 
(e)] The corporation, for the purpose of maintaining integrity and honesty in 3 
racing, may[shall] prescribe by administrative regulation the powers and 4 
duties of the persons employed under this section and qualifications necessary 5 
to competently perform their duties. In addition, the corporation shall be 6 
responsible for seeing that racing officials employed under the provisions of 7 
this section have adequate training to perform their duties in a competent 8 
manner. 9 
(2) (a) The corporation may[shall] promulgate administrative regulations for 10 
effectively preventing the use of improper devices at race meetings or in the 11 
conduct of sports wagering, and restricting or prohibiting the use and 12 
administration of drugs or stimulants or other improper acts to horses prior to 13 
the horse participating in a race. 14 
(b) The corporation may acquire, operate, and maintain, or contract for the 15 
maintenance and operation of, a testing laboratory and related facilities, for 16 
the purpose of saliva, urine, or other tests, and to purchase supplies and 17 
equipment for and in connection with the laboratory or testing processes. 18 
(c) The expense of the laboratory or other testing processes, whether furnished by 19 
contract or otherwise, together with all supplies and equipment used in 20 
connection therewith, shall be paid by the various associations licensed under 21 
this chapter in the manner and in proportions as the corporation may[shall] by 22 
administrative regulation provide. 23 
(3) (a) The expenses of the corporation and the compensation of all employees 24 
referred to in this section shall be paid by the licensee conducting a horse race 25 
meeting or pari-mutuel wagering on live or historic horse racing, provided 26 
that the expenses of the corporation and the compensation of employees under 27  UNOFFICIAL COPY  	25 RS BR 387 
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this section related to administering the system of sports wagering shall be 1 
paid by the sports wagering administration fund established in KRS 230.817. 2 
(b)[ The salary of the president to the corporation shall be prorated among and 3 
paid by the various persons licensed under this chapter in the manner as the 4 
corporation shall, by administrative regulation, provide. 5 
(c)] Except for the Thoroughbred steward and the standardbred judge authorized 6 
in subsection (1) of this section, the employees referred to in this section shall 7 
be[ deemed employees of the corporation, and are] paid by the licensee or 8 
association. 9 
(4) Each person, as a condition precedent to the privilege of receiving a license under 10 
this chapter to conduct a horse race meeting, shall be deemed to have agreed to pay 11 
expenses and compensation as provided in this section and as may be actually and 12 
reasonably incurred. 13 
SECTION 9.   A NEW SECTION OF KRS CHAPTER 230 IS CREATED TO 14 
READ AS FOLLOWS: 15 
The state budget director, the secretary of the Finance and Administration Cabinet, the 16 
Department of Revenue, and the State Treasurer shall transfer to the corporation all 17 
existing moneys, including carry forward balances and interest, by June 30, 2025, and 18 
any future receipts shall be dispersed to the following corporate accounts: 19 
(1) Kentucky Thoroughbred development fund; 20 
(2) Kentucky quarter horse development fund; 21 
(3) Kentucky quarter horse purse fund; 22 
(4) Kentucky paint horse, Appaloosa, and Arabian development fund; 23 
(5) Kentucky paint horse, Appaloosa, and Arabian purse fund; 24 
(6) Kentucky standardbred development fund; 25 
(7) Kentucky Thoroughbred breeders incentive fund; 26 
(8) Kentucky standardbred breeders incentive fund; 27  UNOFFICIAL COPY  	25 RS BR 387 
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(9) Kentucky horse breeders incentive fund; 1 
(10) Kentucky Racing Health and Welfare Fund, Inc.; 2 
(11) Harness racing at county fairs under KRS 230.398; 3 
(12) Backside improvement fund; 4 
(13) Kentucky Thoroughbred Owners and Breeders, Inc. under KRS 230.380; 5 
(14) Kentucky horse racing and gaming administration fund; 6 
(15) Thoroughbred, standardbred, and American quarter horse aftercare facilities 7 
under subsection (1)(d)4.d.i. of Section 33 of this Act; 8 
(16) Kentucky equine management internship under subsection (1)(d)4.d.ii. of Section 9 
33 of this Act; 10 
(17) Equine drug research fund; and 11 
(18) Charitable gaming regulatory account. 12 
SECTION 10.   A NEW SECTION OF KRS CHAPTER 230 IS CREATED TO 13 
READ AS FOLLOWS: 14 
(1) All licensed associations shall report to the corporation by December 31 of each 15 
year the following allocations of unredeemed pari-mutuel vouchers: 16 
(a) For Thoroughbreds, standardbreds, quarter horses, paint horses, 17 
Appaloosas, or Arabian horses by distributing: 18 
1. Twenty-five percent (25%) for the administration and regulation of 19 
live horse racing; and 20 
2. Sixty-five percent (65%) for health, safety, or track and facility 21 
improvements, at a licensed track in Kentucky, and: 22 
a. As a condition for receiving moneys under this subparagraph, an 23 
applicant shall agree to comply with any requirements that the 24 
corporation determines; 25 
b. The moneys distributed under this subparagraph shall be 26 
granted back to each licensed track in a proportion equal to the 27  UNOFFICIAL COPY  	25 RS BR 387 
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amount of unredeemed pari-mutuel vouchers each track 1 
submitted to the corporation unless the licensed track agrees to a 2 
transfer of those funds to another licensed track with the 3 
approval of the corporation; and 4 
c. The moneys distributed under this subparagraph shall be used 5 
for health and safety improvements, as well as construction 6 
projects, including without limitation, barns, living quarters, 7 
kitchens, dormitories, and recreational areas; and  8 
(b) By transferring ten percent (10%) the Kentucky problem gambling 9 
assistance account established by KRS 230.826. 10 
(2) All funds held by a licensed track from unredeemed pari-mutuel vouchers: 11 
(a)  Issued at least one (1) year prior to the effective date of this section shall be 12 
deemed property of the licensed track; and 13 
(b) Shall be separated, maintained, and distributed in the manner provided in 14 
this section. 15 
Section 11.   KRS 230.3771 is amended to read as follows: 16 
(1) A Thoroughbred track licensed to conduct Thoroughbred racing may receive 17 
interstate simulcasts of Thoroughbred, quarter horse, paint horse, Appaloosa, and 18 
Arabian horse races, and conduct interstate wagering thereon, subject to the 19 
following limitations: 20 
(a) A Thoroughbred receiving track may receive interstate simulcasts of 21 
Thoroughbred races and conduct interstate wagering thereon at any time of 22 
day and during any live Thoroughbred horse race meet conducted in the 23 
Commonwealth of Kentucky so long as the Thoroughbred receiving track 24 
conducting interstate wagering remits to the Thoroughbred host track 25 
conducting a live meet, from the first awarded day of its live meet through the 26 
last awarded day of the same live meet, the amounts provided in paragraph (j) 27  UNOFFICIAL COPY  	25 RS BR 387 
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of this subsection. 1 
(b) A Thoroughbred host track which receives interstate simulcasts and conducts 2 
interstate wagering thereon during the period of time from the first awarded 3 
day of its live meet through the last awarded day of its live meet shall offer 4 
the simulcasts to all Thoroughbred receiving tracks, all harness tracks not 5 
subject to the provisions of KRS 230.377(2), and all simulcast facilities 6 
through the intertrack wagering system. 7 
(c) Except as otherwise prohibited by law, a receiving track shall conduct 8 
intertrack wagering on all live races of all Thoroughbred host tracks on any 9 
day on which it receives an interstate simulcast for the purpose of conducting 10 
interstate wagering. 11 
(d) No host track shall require that any receiving track or simulcast facility 12 
receive the interstate simulcast. 13 
(e) If more than one (1) Thoroughbred track conducts live racing at the same time 14 
on the same day, no track or simulcast facility may receive an interstate 15 
simulcast of Thoroughbred races unless all Thoroughbred tracks conducting 16 
live racing at the same time of day agree upon all interstate simulcasts to be 17 
received and the division of the Thoroughbred host track's commission. If 18 
more than one (1) Thoroughbred track conducts live racing at different times 19 
on the same day, the Thoroughbred host track with the highest average daily 20 
handle, based on the preceding year, shall be the host track for purposes of 21 
splitting the commissions earned on interstate wagering at receiving tracks 22 
within the Commonwealth. For purposes of this subsection, average daily 23 
handle includes live handle, intertrack wagering handle, and simulcast facility 24 
handle. Also for purposes of this subsection, the time of day during which a 25 
host track conducts live racing commences with its first published post time 26 
and concludes ten (10) minutes after the published post time of its last race of 27  UNOFFICIAL COPY  	25 RS BR 387 
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the day, regardless of actual post times. 1 
(f) Each Thoroughbred track which desires to conduct interstate wagering 2 
pursuant to the provisions of this subsection shall during each year make 3 
application to the corporation for no less than one hundred percent (100%) of 4 
the number of racing days awarded to the track in 1994 and one hundred 5 
percent (100%) of the number of races scheduled to be run by the track in 6 
1993. 7 
(g) Notwithstanding paragraph (f) of this subsection, any Thoroughbred track 8 
may apply for less than one hundred percent (100%) of the number of racing 9 
days awarded to the track in 1994 or one hundred percent (100%) of the 10 
number of races scheduled to be run by the track in 1993, if written approval 11 
is obtained from the Kentucky Horsemen's Benevolent and Protective 12 
Association and the Kentucky Thoroughbred Owners and Breeders 13 
Association, Inc. 14 
(h) A separate accounting on all interstate simulcasting shall be submitted to the 15 
corporation. The accounting shall be submitted in the same format and at the 16 
same time that the report for intertrack wagering is submitted. 17 
(i) If the only simulcast or simulcasts a track participating as a host track makes 18 
available for interstate wagering through this state's intertrack wagering 19 
system on any race day are Thoroughbred horse races designated as graded 20 
stakes races by the Graded Stakes Committee of the Thoroughbred Owners 21 
and Breeders Association, Inc., then the commission of the receiving track on 22 
these interstate wagers shall be split as prescribed by KRS 230.378(3); 23 
otherwise, the commission of the receiving track shall be split as prescribed 24 
by paragraph (j) of this subsection. Interstate simulcasts received by a 25 
Thoroughbred host track under the conditions set forth in this paragraph shall 26 
not be subject to the conditions set forth in paragraphs (b), (c), (e), and (f) of 27  UNOFFICIAL COPY  	25 RS BR 387 
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this subsection. 1 
(j) A receiving track's commission on interstate wagering, after deduction of 2 
applicable taxes and any amounts required to be paid by contract to the track 3 
from which the interstate simulcast originated, shall be split as follows: 4 
1. Twenty-five percent (25%) to the receiving track where the interstate 5 
wagering occurs; 6 
2. Twenty-five percent (25%) to the Thoroughbred host track designated 7 
by paragraphs (a) and (e) of this subsection. However, if the race does 8 
not occur between the first awarded day of a live meet and the last 9 
awarded day of the same live meet, an additional twenty-five percent 10 
(25%) shall be retained by the receiving track where the interstate 11 
wagering occurs; 12 
3. Twenty-five percent (25%) to the purse program of the receiving track 13 
where the interstate wagering occurs; and 14 
4. Twenty-five percent (25%) to the purse program of the Thoroughbred 15 
host track designated by paragraphs (a) and (e) of this subsection. 16 
However, if the race does not occur between the first awarded day of a 17 
live meet and the last awarded day of the same live meet, then an 18 
additional twenty-five percent (25%) shall be paid to the purse program 19 
of the receiving track where the interstate wagering occurs. 20 
(k) A simulcast facility's commission on interstate wagering on Thoroughbred 21 
racing, after deduction of applicable taxes and any amounts required to be 22 
paid by contract to the track from which the interstate simulcast originated, 23 
shall be split as provided in KRS 230.380(9). 24 
(2) A harness track licensed to conduct harness racing may receive interstate simulcasts 25 
of harness horse, quarter horse, paint horse, Appaloosa, and Arabian horse races 26 
and conduct interstate wagering thereon subject to the following limitations: 27  UNOFFICIAL COPY  	25 RS BR 387 
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(a) A harness receiving track may receive interstate simulcasts of harness races, 1 
quarter horse races, paint horse races, Appaloosa races, and Arabian horse 2 
races, and conduct interstate wagering thereon at any time of day and during 3 
the course of any live harness horse race meet conducted in the 4 
Commonwealth of Kentucky so long as the harness receiving track 5 
conducting interstate wagering remits to the harness host track conducting a 6 
live meet, from the first awarded day of its live meet through the last awarded 7 
day of the same live meet, the amounts provided in paragraph (j) of this 8 
subsection. 9 
(b) A harness host track which receives an interstate simulcast and conducts 10 
interstate wagering thereon during its live race meet shall offer the simulcasts 11 
to all Thoroughbred receiving tracks not subject to the provisions of KRS 12 
230.377(2), all harness tracks, and all simulcast facilities through the 13 
intertrack wagering system. 14 
(c) Except as otherwise prohibited by law, a harness receiving track or a 15 
simulcast facility shall conduct intertrack wagering on all live races of a 16 
harness host track on any day it receives an interstate simulcast from a harness 17 
host track. 18 
(d) No host track shall require that any receiving track or simulcast facility 19 
receive the interstate simulcast. 20 
(e) If more than one (1) harness track conducts live racing at the same time on the 21 
same day, no track or simulcast facility may receive an interstate simulcast on 22 
harness races unless all harness tracks conducting live racing at that time of 23 
day agree upon the interstate simulcast to be received and the division of the 24 
harness host track's commission. If more than one (1) harness track conducts 25 
live racing at different times on the same day, the harness host track with the 26 
highest average daily handle, based on the preceding year, shall be the host 27  UNOFFICIAL COPY  	25 RS BR 387 
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track for purposes of splitting the commissions earned on interstate wagering 1 
at receiving tracks within the Commonwealth. For purposes of this subsection, 2 
average daily handle includes live handle, intertrack wagering handle, and 3 
simulcast facility handle. Also for purposes of this subsection, the time of day 4 
during which a host track conducts live racing commences with its first 5 
published post time and conclude ten (10) minutes after the published post 6 
time of its last race of the day, regardless of actual post times. 7 
(f) Each harness track which desires to conduct interstate wagering pursuant to 8 
the provisions of this subsection shall during each year make application to 9 
the corporation for no less than one hundred percent (100%) of the number of 10 
racing days awarded to the track in 1994 and one hundred percent (100%) of 11 
the number of races scheduled to be run by the track in 1993. 12 
(g) Notwithstanding paragraph (f) of this subsection, any harness track may apply 13 
for less than one hundred percent (100%) of the number of racing days 14 
awarded to the track in 1994 or one hundred percent (100%) of the number of 15 
races scheduled to be run by the track in 1993, if written approval is obtained 16 
from the Kentucky Harness Horsemen's Association, or its successor. 17 
(h) A separate accounting on all interstate simulcasting shall be submitted to the 18 
corporation. This accounting shall be submitted in the same format and at the 19 
same time that the report for intertrack wagering is submitted. 20 
(i) If the only simulcast or simulcasts a track participating as a harness host track 21 
makes available for interstate wagering through this state's intertrack 22 
wagering system on any race day are harness horse races (both final and 23 
elimination) having a final purse in excess of seventy-five thousand dollars 24 
($75,000), then the commission of the receiving track on these interstate 25 
wagers shall be split as prescribed by KRS 230.378(3); otherwise, the 26 
commission of the receiving track shall be split as prescribed by paragraph (j) 27  UNOFFICIAL COPY  	25 RS BR 387 
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of this subsection. Interstate simulcasts received by a harness host track under 1 
the conditions set forth in this paragraph shall not be subject to the conditions 2 
set forth in paragraphs (b), (c), (e), and (f) of this subsection. 3 
(j) A receiving track's commission on interstate wagering, after deduction of 4 
applicable taxes and any amounts required to be paid by contract to the track 5 
from which the interstate simulcast originated, shall be split as follows: 6 
1. Twenty-five percent (25%) to the receiving track where the interstate 7 
wagering occurs; 8 
2. Twenty-five percent (25%) to the harness host track designated by 9 
paragraphs (a) and (e) of this subsection. However, if no live meet is 10 
occurring, an additional twenty-five percent (25%) shall be retained by 11 
the receiving track where the interstate wagering occurs; 12 
3. Twenty-five percent (25%) to the purse program of the receiving track 13 
where the interstate wagering occurs; and 14 
4. Twenty-five percent (25%) to the purse program of the harness host 15 
track designated by paragraphs (a) and (e) of this subsection. However, 16 
if no live meet is occurring, an additional twenty-five percent (25%) 17 
shall be paid to the purse program of the receiving track where the 18 
interstate wagering occurs. 19 
(k) A simulcast facility's commission on interstate wagering on harness races, 20 
after deduction of applicable taxes and any amount required to be paid by 21 
contract to the track from which the interstate simulcast originated, shall be 22 
split as provided in KRS 230.380(9). 23 
(3) A harness track may only receive interstate simulcasts of Thoroughbred horse races 24 
and conduct interstate wagering thereon as provided in subsection (1)(b) of this 25 
section. A Thoroughbred track may only receive interstate simulcasts of harness 26 
horse races and conduct interstate wagering thereon as provided in subsection (2)(b) 27  UNOFFICIAL COPY  	25 RS BR 387 
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of this section. A simulcast facility may only receive interstate simulcasts of 1 
Thoroughbred and harness horse races and conduct interstate wagering thereon as 2 
provided in subsections (1)(b) and (2)(b) of this section. 3 
(4) (a) A Thoroughbred track licensed to conduct horse racing may receive interstate 4 
simulcasts of quarter horse, paint horse, Appaloosa, and Arabian horse races 5 
and conduct interstate wagering thereon, subject to the limitations stated in 6 
paragraph (b) of this subsection. 7 
(b) A receiving track's commission on interstate wagering, after deduction of 8 
applicable taxes and any amounts required to be paid by contract to the track 9 
from which the interstate simulcast originated, shall be split as follows: 10 
1. Twenty-five percent (25%) to the receiving track where the interstate 11 
wagering occurs; 12 
2. Twenty-five percent (25%) to the host track; and 13 
3. Consistent with the horse breed participating in the race: 14 
a. Fifty percent (50%) to the Kentucky[ quarter horse,] paint horse, 15 
Appaloosa, and Arabian purse fund established by KRS 230.446 to 16 
supplement purses for[ quarter horse,] paint horse, Appaloosa, and 17 
Arabian horse races in this state; or 18 
b. Fifty percent (50%) to the Kentucky quarter horse purse fund 19 
established by Section 14 of this Act to supplement purses for 20 
quarter horse races in this state. 21 
(5) (a) A harness track licensed to conduct horse racing may receive interstate 22 
simulcasts of quarter horse, paint horse, Appaloosa, and Arabian horse races 23 
and conduct interstate wagering thereon, subject to the limitations stated in 24 
paragraphs (b),[ and] (c), and (d) of this subsection. 25 
(b) A receiving track's commission on interstate wagering, after deduction of 26 
applicable taxes and any amounts required to be paid by contract to the track 27  UNOFFICIAL COPY  	25 RS BR 387 
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from which the interstate simulcast originated, shall be split as follows: 1 
1. Twenty-five percent (25%) to the purse program of the receiving track; 2 
2. Twenty-five percent (25%) to the purse program of the host track; 3 
3. Twenty-five percent (25%) to the receiving track; and 4 
4. Twenty-five percent (25%) to the host track. 5 
(c) When a[ quarter horse,] paint horse, Appaloosa, or Arabian horse race is run 6 
at a Kentucky race track, the commission to the Kentucky[ quarter horse,] 7 
paint horse, Appaloosa, and Arabian purse fund established by KRS 230.446 8 
shall be twenty-two percent (22%) from the host track's purse share. 9 
(d) When a quarter horse race is run at a Kentucky race track, the commission 10 
to the Kentucky quarter horse purse fund established by Section 14 of this 11 
Act shall be twenty-two percent (22%) from the host track's purse share. 12 
(6) Other provisions of the Kentucky Revised Statutes notwithstanding, any track in a 13 
geographic area that contains more than one (1) track within a fifty (50) mile radius 14 
of any other track may only receive interstate simulcasts on racing of the same 15 
breed of horse as the track was licensed to race on or before July 15, 1998, except 16 
any track may receive interstate simulcasts on quarter horse, paint horse, 17 
Appaloosa, or Arabian horse races. 18 
Section 12.   KRS 230.400 is amended to read as follows: 19 
(1) (a) There is hereby created a corporate[trust and agency] account for the 20 
Kentucky Horse Racing and Gaming Corporation, designated as the Kentucky 21 
Thoroughbred development fund, consisting of moneys allocated to the fund 22 
under the provisions of KRS 138.510, together with other moneys contributed 23 
to or allocated to the fund from all other sources.  24 
(b) Moneys to the credit of the Kentucky Thoroughbred development fund shall 25 
be transferred in the following order: 26 
1. One hundred thousand dollars ($100,000) each fiscal year to the 27  UNOFFICIAL COPY  	25 RS BR 387 
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Kentucky problem gambling assistance account established in KRS 1 
230.826; and 2 
2. Remaining moneys to the Kentucky Horse Racing and Gaming 3 
Corporation to be divided as follows: 4 
a. At least ninety percent (90%) shall be allocated within Kentucky 5 
as set forth in this section; and 6 
b. Up to ten percent (10%) for administration and operation of the 7 
corporation[for the purposes specified in this section].  8 
(c) Moneys from the Kentucky Thoroughbred development fund shall be 9 
allocated to each licensed association in an amount equal to at least ninety 10 
percent (90%) of the amount the association contributed to the fund.  11 
(d) Moneys to the credit of the Kentucky Thoroughbred development fund at the 12 
end of each fiscal year shall not lapse, but shall be carried forward in such 13 
fund to the succeeding fiscal year. 14 
(2) There is hereby established, under the general jurisdiction of the Kentucky Horse 15 
Racing and Gaming Corporation, a Kentucky Thoroughbred Development Fund 16 
Advisory Committee. The advisory committee shall consist of five (5) members, all 17 
of whom shall be residents of Kentucky, to be appointed by the chairman of the 18 
Kentucky Horse Racing and Gaming Corporation by July 1 of each year. The 19 
committee shall consist of two (2) Thoroughbred breeders recommended by the 20 
Kentucky Thoroughbred Owners and Breeders, Inc.; one (1) Thoroughbred owner 21 
recommended by the Kentucky division of the Horsemen's Benevolent and 22 
Protective Association; one (1) officer or director of a licensed association 23 
conducting Thoroughbred racing in Kentucky, recommended by action of all of the 24 
licensed associations conducting Thoroughbred racing in Kentucky; and one (1) 25 
member of the Kentucky Horse Racing and Gaming Corporation. If any member 26 
other than the corporation member has not been recommended for appointment by 27  UNOFFICIAL COPY  	25 RS BR 387 
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July 1 of each year, the chairman of the Kentucky Horse Racing and Gaming 1 
Corporation shall make an appointment for the organization or organizations failing 2 
to recommend a member of the committee. The members of the advisory committee 3 
shall serve without compensation, but shall be entitled to reimbursement for all 4 
expenses incurred in the discharge of official business. The advisory committee 5 
shall select from its membership annually a chairman and a vice chairman. 6 
(3) (a) The Kentucky Thoroughbred Development Fund Advisory Committee shall 7 
advise and assist the Kentucky Horse Racing and Gaming Corporation in the 8 
development of the supplemental purse program provided herein for 9 
Kentucky-bred Thoroughbreds, shall make recommendations to the 10 
corporation with respect to the establishment of guidelines, administrative 11 
regulations for the provision of supplemental purses, the amount thereof, the 12 
races for which the purses are to be provided and the conditions thereof, 13 
manner and method of payment of supplemental purses, registry of 14 
Thoroughbred stallions standing within the Commonwealth of Kentucky, 15 
registry of Kentucky-bred Thoroughbreds for purposes of this section, nature 16 
and type of forms and reports to be employed and required in connection with 17 
the establishment, provision for, award and payment of supplemental purses, 18 
and with respect to all other matters necessary in connection with the carrying 19 
out of the intent and purposes of this section. 20 
(b) The Kentucky Horse Racing and Gaming Corporation shall employ qualified 21 
personnel as may be required to assist the corporation and the advisory 22 
committee in carrying out the provisions of this section. These persons shall 23 
serve at the pleasure of the corporation and compensation for these personnel 24 
shall be fixed by the corporation[. The compensation of these personnel and 25 
the necessary expenses incurred by the corporation or by the committee in 26 
carrying out the provisions of this section shall be paid out of the Kentucky 27  UNOFFICIAL COPY  	25 RS BR 387 
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Thoroughbred development fund]. 1 
(4) The Kentucky Horse Racing and Gaming Corporation, with the advice and 2 
assistance of the Kentucky Thoroughbred Development Fund Advisory Committee, 3 
shall use the Kentucky Thoroughbred development fund to promote, enhance, 4 
improve, and encourage the further and continued development of the 5 
Thoroughbred breeding industry in Kentucky by providing, out of the Kentucky 6 
Thoroughbred development fund, supplemental purses for designated stakes, 7 
handicap, allowance, nonclaiming maiden races, and claiming races contested at 8 
licensed Thoroughbred race meetings in Kentucky. The Kentucky Horse Racing 9 
and Gaming Corporation may[shall], by administrative regulation promulgated in 10 
accordance with KRS Chapter 13A, establish the requirements, conditions, and 11 
procedures for awarding and payment of supplemental purses in designated races 12 
by Kentucky-bred Thoroughbred horses. That portion of the supplemental purse 13 
provided for any designated race shall be awarded and paid to the owner of the 14 
horse only if the horse is a Kentucky-bred Thoroughbred duly registered with the 15 
official registrar. Any portion of the supplemental purse which is not awarded and 16 
paid over shall be returned to the Kentucky Thoroughbred development fund. 17 
(5) (a) For purposes of this section, the term "Kentucky Thoroughbred stallion" shall 18 
mean and include only a Thoroughbred stallion standing the entire breeding 19 
season in Kentucky and registered as a Kentucky Thoroughbred stallion with 20 
the official registrar of the Kentucky Thoroughbred development fund. 21 
(b) Except for Thoroughbred horses foaled prior to January 1, 1980, the term 22 
"Kentucky-bred Thoroughbreds," for purposes of this section, shall mean and 23 
include only Thoroughbred horses sired by Kentucky Thoroughbred stallions 24 
foaled in Kentucky and registered as a Kentucky-bred Thoroughbred with the 25 
official registrar of the Kentucky Thoroughbred development fund. 26 
(c) Any Thoroughbred horse foaled prior to January 1, 1980, may qualify as a 27  UNOFFICIAL COPY  	25 RS BR 387 
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Kentucky-bred Thoroughbred for purposes of this section if the horse was 1 
foaled in Kentucky and if the sire of the Thoroughbred was standing at stud 2 
within Kentucky at the time of conception of such Thoroughbred, provided 3 
the Thoroughbred is duly registered as a Kentucky-bred Thoroughbred with 4 
the official registrar of the Kentucky Thoroughbred development fund. 5 
(d) In order for an owner of a Kentucky-sired Thoroughbred to be eligible to 6 
demand, claim, and receive a portion of a supplemental purse provided by the 7 
Kentucky Thoroughbred development fund, the Thoroughbred horse in a 8 
designated race for which a supplemental purse has been provided by the 9 
Kentucky Thoroughbred development fund shall[must] have been duly 10 
registered as a Kentucky-bred Thoroughbred with the official registrar of the 11 
Kentucky Thoroughbred development fund prior to entry in the race. 12 
(6) (a) Kentucky Thoroughbred Owners and Breeders, Inc., is hereby recognized and 13 
designated as the sole official registrar of the Kentucky Thoroughbred 14 
development fund for the purposes of registering Kentucky Thoroughbred 15 
stallions and Kentucky-bred Thoroughbreds in accordance with the terms of 16 
this section and any administrative regulations promulgated by the Kentucky 17 
Horse Racing and Gaming Corporation. When a Kentucky -bred 18 
Thoroughbred is registered with the official registrar, the registrar shall be 19 
authorized to stamp the Jockey Club certificate issued for the Thoroughbred 20 
with the seal of the registrar, certifying that the Thoroughbred is a duly 21 
qualified and registered Kentucky-bred Thoroughbred for purposes of this 22 
section. The registrar may establish and charge, with the approval of the 23 
corporation, reasonable registration fees for its services in the registration of 24 
Kentucky Thoroughbred stallions and in the registration of Kentucky-bred 25 
Thoroughbreds. Registration records of the registrar shall be public records 26 
and open to public inspection at all normal business hours and times. 27  UNOFFICIAL COPY  	25 RS BR 387 
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(b) Any interested party aggrieved by the failure or refusal of the official registrar 1 
to register a stallion or Thoroughbred as a Kentucky stallion or as a Kentucky-2 
bred Thoroughbred shall have the right to file with the registrar[corporation], 3 
within thirty (30) days of such failure or refusal of the registrar, a petition 4 
seeking registration of the Thoroughbred. The corporation shall promptly hear 5 
the matter de novo and issue its order directing the official registrar to register 6 
or not to register as it may be determined by the registrar[corporation]. 7 
(7) The Kentucky Horse Racing and Gaming Corporation may[shall] promulgate 8 
administrative regulations[ as may be necessary] to carry out the provisions and 9 
purposes of this section, including the promulgation of administrative regulations 10 
and forms[ as may be appropriate] for the proper registration of Kentucky stallions 11 
and Kentucky-bred Thoroughbreds with the official registrar, and shall administer 12 
the Kentucky-bred Thoroughbred program created hereby in a manner best 13 
designed to promote and aid in the further development of the Thoroughbred 14 
breeding industry in Kentucky, to upgrade the quality of Thoroughbred racing in 15 
Kentucky, and to improve the quality of Thoroughbred horses bred in Kentucky. 16 
SECTION 13.   A NEW SECTION OF KRS CHAPTER 230 IS CREATED TO 17 
READ AS FOLLOWS: 18 
(1) (a) There is hereby created a corporate account for the Kentucky Horse Racing 19 
and Gaming Corporation, designated as the Kentucky quarter horse 20 
development fund, consisting of moneys allocated to the fund under Section 21 
11 of this Act together with any other moneys contributed to or allocated to 22 
the fund from all other sources.  23 
(b) For the purposes of this section, "development fund" or "fund" means the 24 
Kentucky quarter horse development fund.  25 
(c) Moneys to the credit of the development fund shall be transferred in the 26 
following order: 27  UNOFFICIAL COPY  	25 RS BR 387 
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1. Twenty-five thousand dollars ($25,000) each fiscal year to the 1 
Kentucky problem gambling assistance account established in KRS 2 
230.826; and 3 
2. Remaining moneys to be divided as follows: 4 
a. At least ninety percent (90%) shall be allocated within Kentucky 5 
as set forth in this section; and 6 
b. Up to ten percent (10%) for administration and operation of the 7 
corporation.  8 
(d) Notwithstanding KRS 45.229, moneys to the credit of the fund at the end of 9 
the fiscal year shall not lapse but shall be carried forward in the fund to the 10 
succeeding fiscal year.  11 
(e) Interest earnings of the fund shall become a part of the fund and shall not 12 
lapse.  13 
(2) (a) The Kentucky Horse Racing and Gaming Corporation shall use the 14 
development fund to promote races, provide purses for races, and award 15 
breeders for horses bred and foaled in the Commonwealth.  16 
(b) A foal of a pregnant mare bred in another state and brought back to 17 
Kentucky to foal beginning with the breeding year 2025 and ending with 18 
foals of the foaling year 2028 may be eligible for moneys from the fund. The 19 
pregnant mare shall foal in Kentucky and have the resulting foal registered 20 
as a Kentucky-bred quarter horse. Then the same mare, within the same 21 
calendar year of the first foal being born, may be bred in Kentucky and 22 
registered to the fund. If the mare foals a second time in Kentucky based on 23 
this breeding, the resulting foal shall be registered as a Kentucky-bred 24 
quarter horse.  25 
(c) The corporation shall provide for distribution of moneys to the credit of the 26 
development fund to persons, corporations, or associations operating 27  UNOFFICIAL COPY  	25 RS BR 387 
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licensed tracks within Kentucky conducting quarter horse racing, on an 1 
equitable basis as determined by the corporation and in conformance with 2 
subsections (3) and (4) of this section. 3 
(3) The Kentucky Horse Racing and Gaming Corporation: 4 
(a) Shall approve the amount of moneys to be paid from the development fund 5 
to be: 6 
1. Added to the purse provided for each race by the licensed operator of 7 
the track; and 8 
2. Awarded to breeders of Kentucky-bred quarter horses that win races at 9 
licensed tracks in Kentucky; 10 
(b) Shall approve the dates and conditions of races to be held by licensed 11 
tracks; and 12 
(c) May promulgate administrative regulations in accordance with KRS 13 
Chapter 13A to carry out the provisions of this section. 14 
(4) (a) Moneys from the fund shall be allocated to each licensed association in an 15 
amount equal to at least ninety percent (90%) of the amount the association 16 
contributed to the fund. 17 
(b) Any portion of a supplemental purse that is not awarded and paid over shall 18 
be returned to the fund. 19 
(c) The portion of the supplemental purse provided for any designated race 20 
shall be awarded and paid to the owner of the horse only if the horse is duly 21 
registered with the official registrar under this section. 22 
(5) (a) In order for an owner of a Kentucky-bred quarter horse to be eligible to 23 
demand, claim, and receive a portion of a supplemental purse provided by 24 
the Kentucky quarter horse development fund, the quarter horse in a 25 
designated race for which a supplemental purse has been provided by the 26 
Kentucky quarter horse development fund shall have been duly registered 27  UNOFFICIAL COPY  	25 RS BR 387 
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as a Kentucky-bred quarter horse with the official registrar of the Kentucky 1 
quarter horse development fund prior to entry in the race. 2 
(b) The Kentucky Quarter Horse Racing Association is hereby recognized and 3 
designated as the sole official registrar of the Kentucky quarter horse 4 
development fund for the purposes of registering Kentucky quarter horse 5 
stallions, quarter horse mares, and Kentucky-bred quarter horses in 6 
accordance with the terms of this section and any administrative regulations 7 
promulgated by the Kentucky Horse Racing and Gaming Corporation. 8 
When a Kentucky-bred quarter horse is registered with the official registrar, 9 
the registrar shall be authorized to stamp the American Quarter Horse 10 
Association certificate issued for the quarter horse with the seal of the 11 
registrar, certifying that the quarter horse is a duly qualified and registered 12 
Kentucky-bred quarter horse for purposes of this section. The registrar may 13 
establish and charge, with the approval of the corporation, reasonable 14 
registration fees for its services in the registration of Kentucky quarter 15 
horse stallions, quarter horse mares, and Kentucky-bred quarter horses. 16 
Registration records of the registrar shall be public records and open to 17 
public inspection at all normal business hours and times. 18 
(c) Any interested party aggrieved by the failure or refusal of the official 19 
registrar to register a stallion, mare, or quarter horse as a Kentucky stallion, 20 
mare, or Kentucky-bred quarter horse shall have the right to file with the 21 
registrar, within thirty (30) days of the failure or refusal of the registrar, a 22 
petition seeking registration of the quarter horse. The registrar shall 23 
promptly hear the matter de novo and issue its order. 24 
(6) The Kentucky Horse Racing and Gaming Corporation shall: 25 
(a) Supervise registration of, or determine the eligibility of, horses entitled to 26 
entry in races which receive a portion of purse money from the development 27  UNOFFICIAL COPY  	25 RS BR 387 
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fund; and 1 
(b) Determine the conditions, class, and quality of the fund-supported race 2 
program established to carry out the purposes of this section. 3 
(7) The corporation may promulgate administrative regulations in accordance with 4 
KRS Chapter 13A to carry out the provisions and purposes of this section and 5 
shall administer the Kentucky quarter horse development fund in a manner 6 
designed to: 7 
(a) Promote and aid in the development of the quarter horse industry in 8 
Kentucky; 9 
(b) Upgrade the quality of quarter horse racing in Kentucky; and 10 
(c) Improve the quality of quarter horses bred in Kentucky. 11 
SECTION 14.   A NEW SECTION OF KRS CHAPTER 230 IS CREATED TO 12 
READ AS FOLLOWS: 13 
(1) The Kentucky quarter horse purse fund is created as a corporate fund to be 14 
administered by the Kentucky Horse Racing and Gaming Corporation and shall 15 
consist of moneys allocated to the fund under Section 11 of this Act together with 16 
any other moneys contributed to or allocated to the fund from all other sources. 17 
For the purposes of this section, "purse fund" or "fund" means the Kentucky 18 
quarter horse purse fund. 19 
(2) Notwithstanding KRS 45.229, money to the credit of the fund at the end of the 20 
fiscal year shall not lapse but shall be carried forward in the fund to the 21 
succeeding fiscal year. Interest earnings of the fund shall become a part of the 22 
fund and shall not lapse. 23 
(3) The Kentucky Horse Racing and Gaming Corporation shall use at least ninety 24 
percent (90%) of the purse fund to promote quarter horse racing and to provide 25 
purses for quarter horse races conducted in the Commonwealth as follows: 26 
(a) The Kentucky Horse Racing and Gaming Corporation shall provide for 27  UNOFFICIAL COPY  	25 RS BR 387 
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distribution of money from the fund to persons, corporations, or 1 
associations operating licensed tracks within the Commonwealth 2 
conducting quarter horse racing; 3 
(b) At least ninety percent (90%) of the moneys from the fund shall be allocated 4 
to each licensed association located in the Commonwealth in proportion to 5 
the amount each association contributed to the fund; and 6 
(c) The Kentucky Horse Racing and Gaming Corporation shall consult with 7 
the Kentucky Quarter Horse Racing Association or its successor to 8 
designate the races and the amount of purse money to be provided for 9 
designated quarter horse races. 10 
(4) The Kentucky Horse Racing and Gaming Corporation may use up to ten percent 11 
(10%) of the purse fund for administration and operation of the corporation. 12 
(5) The Kentucky Horse Racing and Gaming Corporation: 13 
(a) Shall fix the dates and conditions of quarter horse races to be held by 14 
licensed tracks; 15 
(b) Shall fix the amount of money to be paid from the fund to be added to the 16 
purse provided for each quarter horse race by the licensed operator of the 17 
track; and 18 
(c) May promulgate administrative regulations in accordance with KRS 19 
Chapter 13A to carry out the provisions of this section. 20 
(6) The Kentucky Horse Racing and Gaming Corporation shall carry out the 21 
provisions of this section and administer the purse fund in a manner designed to 22 
promote and aid in the development of the quarter horse industry in Kentucky 23 
and upgrade the quality of quarter horse racing in Kentucky. 24 
Section 15.   KRS 230.445 is amended to read as follows: 25 
(1) (a) There is hereby created a corporate[trust and agency] account for the 26 
Kentucky Horse Racing and Gaming Corporation designated the Kentucky[ 27  UNOFFICIAL COPY  	25 RS BR 387 
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quarter horse,] paint horse, Appaloosa, and Arabian development fund, 1 
consisting of moneys allocated to the fund under KRS 230.3771 together with 2 
any other moneys contributed to or allocated to the fund from all other 3 
sources.  4 
(b) For the purposes of this section, "development fund" or "fund" means the 5 
Kentucky[ quarter horse,] paint horse, Appaloosa, and Arabian development 6 
fund.  7 
(c) Moneys to the credit of the development fund shall be transferred in the 8 
following order: 9 
1. Twenty-five thousand dollars ($25,000) each fiscal year to the Kentucky 10 
problem gambling assistance account established in KRS 230.826; and 11 
2. Remaining moneys to be divided as follows: 12 
a. At least ninety percent (90%) shall be allocated within Kentucky 13 
as set forth in this section; and 14 
b. Up to ten percent (10%) for administration and operation of the 15 
corporation[the Kentucky Horse Racing and Gaming Corporation 16 
for the purposes specified in this section].  17 
(d) Notwithstanding KRS 45.229, moneys to the credit of the fund at the end of 18 
the fiscal year shall not lapse but shall be carried forward in the fund to the 19 
succeeding fiscal year.  20 
(e) Interest earnings of the fund shall become a part of the fund and shall not 21 
lapse.  22 
(f) Moneys in the fund shall be used [and are hereby appropriated ]for purposes 23 
specified in this section. 24 
(2) The Kentucky Horse Racing and Gaming Corporation shall use the development 25 
fund to promote races and to provide purses for races for horses bred and foaled in 26 
the Commonwealth. The corporation shall provide for distribution of moneys to the 27  UNOFFICIAL COPY  	25 RS BR 387 
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credit of the development fund to persons, corporations, or associations operating 1 
licensed tracks within Kentucky conducting[ quarter horse,] paint horse, Appaloosa, 2 
or Arabian horse racing, on an equitable basis as determined by the corporation and 3 
in conformance with subsection (3) of this section. 4 
(3) (a) The Kentucky Horse Racing and Gaming Corporation shall: 5 
1.[(a)] Fix the amount of moneys to be paid from the development fund 6 
to be added to the purse provided for each race by the licensed operator 7 
of the track; and 8 
2.[(b)] Fix the dates and conditions of races to be held by licensed tracks[; 9 
and 10 
(c) Promulgate administrative regulations necessary to carry out the provisions of 11 
this section]. 12 
 (b) At least ninety percent (90%) of the moneys from the fund shall be 13 
allocated to each breed of horse represented in the fund in an amount equal to 14 
the amount the breed has contributed to the fund. 15 
(4) The Kentucky Horse Racing and Gaming Corporation shall[ appoint qualified 16 
personnel as necessary to]: 17 
(a) Supervise registration of, or determine the eligibility of, horses entitled to 18 
entry in races which receive a portion of purse money from the development 19 
fund; and 20 
(b) Determine[Assist the corporation in determining] the conditions, class, and 21 
quality of the fund-supported race program established to carry out the 22 
purposes of this section. 23 
 The personnel shall serve at the pleasure of the corporation and compensation shall 24 
be fixed by the corporation[ with the compensation and necessary expenses of the 25 
personnel paid from the development fund]. 26 
(5) The corporation may[shall] promulgate administrative regulations to carry out the 27  UNOFFICIAL COPY  	25 RS BR 387 
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provisions of this section and shall administer the Kentucky[ quarter horse,] paint 1 
horse, Appaloosa, and Arabian development fund in a manner designed to: 2 
(a) Promote and aid in the development of the horse industry in Kentucky; 3 
(b) Upgrade the quality of racing in Kentucky; and 4 
(c) Improve the quality of horses bred in Kentucky. 5 
Section 16.   KRS 230.446 is amended to read as follows: 6 
(1) The Kentucky[ quarter horse,] paint horse, Appaloosa, and Arabian purse fund is 7 
created as a corporate[trust and agency] fund to be administered by the Kentucky 8 
Horse Racing and Gaming Corporation and shall consist of moneys allocated to the 9 
fund under KRS 230.3771 together with any other moneys contributed to or 10 
allocated to the fund from all other sources. For the purposes of this section, "purse 11 
fund" or" fund" means the Kentucky[ quarter horse,] paint horse, Appaloosa, and 12 
Arabian purse fund. 13 
(2) Notwithstanding KRS 45.229, money to the credit of the fund at the end of the 14 
fiscal year shall not lapse but shall be carried forward in the fund to the succeeding 15 
fiscal year. Interest earnings of the fund shall become a part of the fund and shall 16 
not lapse. 17 
(3) Moneys in the fund shall be used[ and are hereby appropriated] for purposes 18 
specified in this section. 19 
(4) The Kentucky Horse Racing and Gaming Corporation shall use at least ninety 20 
percent (90%) of the purse fund to promote racing and to provide purses for races 21 
conducted in the Commonwealth as follows: 22 
(a) The Kentucky Horse Racing and Gaming Corporation shall provide for 23 
distribution of money from the fund to persons, corporations, or associations 24 
operating licensed tracks within the Commonwealth conducting[ quarter 25 
horse,] paint horse, Appaloosa, or Arabian horse racing; 26 
(b) At least ninety percent (90%) of the moneys from the purse fund shall be 27  UNOFFICIAL COPY  	25 RS BR 387 
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allocated to each breed of horse represented in the fund in proportion to the 1 
amount each breed has contributed to the fund; and 2 
(c) The Kentucky Horse Racing and Gaming Corporation shall consult with[ the 3 
Kentucky Quarter Horse Racing Association or its successor,] the Kentucky 4 
Appaloosa Owners Association or its successor, the Kentucky Paint Horse 5 
Club or its successor, and the Kentucky Arabian Horse Association or its 6 
successor, to designate the races and the amount of purse money to be 7 
provided for designated races for each breed respectively. 8 
(5) Up to ten percent (10%) of the purse fund may be allocated for the administration 9 
and operation of the corporation. 10 
(6)[(5)] The Kentucky Horse Racing and Gaming Corporation[ shall]: 11 
(a) Shall fix the dates and conditions of races to be held by licensed tracks; 12 
(b) Shall fix the amount of money to be paid from the fund to be added to the 13 
purse provided for each race by the licensed operator of the track; and 14 
(c) May promulgate administrative regulations in accordance with KRS Chapter 15 
13A necessary to carry out the provisions of this section. 16 
(7)[(6)] The Kentucky Horse Racing and Gaming Corporation shall carry out the 17 
provisions of this section and administer the purse fund in a manner designed to 18 
promote and aid in the development of the horse industry in Kentucky and upgrade 19 
the quality of horse racing in Kentucky. 20 
Section 17.   KRS 230.770 is amended to read as follows: 21 
(1) (a) There is hereby created a corporate[trust and agency] account for the 22 
Kentucky Horse Racing and Gaming Corporation, designated as the Kentucky 23 
standardbred development fund, consisting of moneys allocated to the fund 24 
under the provisions of KRS 138.510, together with any other moneys 25 
contributed to or allocated to the fund from all other sources. 26 
(b) For the purposes of this section, "development fund" or "fund" means the 27  UNOFFICIAL COPY  	25 RS BR 387 
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Kentucky standardbred development fund. 1 
(c) Moneys to the credit of the development fund shall be transferred in the 2 
following order: 3 
1. Seventy-five thousand dollars ($75,000) each fiscal year to the 4 
Kentucky problem gambling assistance account established in KRS 5 
230.826; and 6 
2. Remaining moneys to be divided as follows: 7 
a. At least ninety percent (90%) shall be allocated within Kentucky 8 
as set forth in this section; and 9 
b. Up to ten percent (10%) may be allocated for administration and 10 
operation of the corporation[the Kentucky Horse Racing and 11 
Gaming Corporation for the purposes specified in this section]. 12 
(d) Moneys to the credit of the fund at the end of each fiscal year shall not lapse 13 
but shall be carried forward in the fund to the succeeding fiscal year. 14 
(2) The Kentucky Horse Racing and Gaming Corporation shall use the development 15 
fund to promote races, and to provide purses for races, for Kentucky-bred 16 
standardbred horses. 17 
(3) The corporation shall: 18 
(a) Account for the moneys in the fund by separating the moneys as required for 19 
distribution under subsections (1) and (4) of this section; and 20 
(b) Provide for distribution of moneys to the credit of the development fund to 21 
persons, corporations, or associations operating licensed standardbred race 22 
tracks within Kentucky on an equitable basis, for the purpose of conducting 23 
separate races for Kentucky-bred standardbred horses, both trotting and 24 
pacing. 25 
(4) The corporation shall establish an international harness racing event reserve account 26 
of up to nine hundred thousand dollars ($900,000) for a Kentucky track that hosts 27  UNOFFICIAL COPY  	25 RS BR 387 
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an international harness racing event spanning multiple days that distributes at least 1 
five million dollars ($5,000,000) in purses and awards. Moneys shall be transferred 2 
from the development fund as follows: 3 
(a) Beginning July 31, 2024, three hundred thousand dollars ($300,000) shall be 4 
transferred annually into the event reserve account until the total amount 5 
transferred into the event reserve account reaches nine hundred thousand 6 
dollars ($900,000); 7 
(b) If the event reserve account reaches nine hundred thousand dollars 8 
($900,000), the annual transfer of moneys into the account shall be suspended 9 
and shall not resume until a Kentucky track has hosted the event and has 10 
received its distribution of moneys under this subsection; and 11 
(c) If an event is held and the nine hundred thousand dollars ($900,000) has been 12 
distributed to the host track, the annual transfers into the event reserve 13 
account under paragraph (a) of this subsection shall resume at that time. 14 
(5) Moneys distributed from the development fund to licensed standardbred race tracks 15 
within the Commonwealth shall be used exclusively to promote races and provide 16 
purses for races conditioned to admit only Kentucky-bred standardbred horses. 17 
(6) The Kentucky Horse Racing and Gaming Corporation shall: 18 
(a) Fix the amount of moneys to be paid from the development fund to be added 19 
to the purse provided for each race by the licensed operator of the track; and 20 
(b) Fix the dates and conditions of races to be held by licensed race tracks[; and 21 
(c) Promulgate administrative regulations in accordance with KRS Chapter 13A 22 
necessary to carry out the provisions of this section]. 23 
(7) (a) The Kentucky Horse Racing and Gaming Corporation may promulgate 24 
administrative regulations in accordance with KRS Chapter 13A to carry out 25 
the provisions of this section, including those administrative regulations 26 
necessary to determine the eligibility of horses for entry in races for which a 27  UNOFFICIAL COPY  	25 RS BR 387 
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portion of the purse is provided by moneys of the development fund, 1 
including administrative regulations for the eligibility, residency, and 2 
registration of mares, stallions, and progeny thereof. 3 
(b) Registration of stallions may occur any time during the breeding season, but 4 
shall occur no later than December 31 of the year of conception of the eligible 5 
horse. 6 
(8) (a) The Kentucky Horse Racing and Gaming Corporation shall appoint qualified 7 
personnel necessary to supervise registration of, or determination of eligibility 8 
of, horses entitled to entry in races, a portion of the purse of which is provided 9 
by the development fund, to assist the corporation in determining the 10 
conditions, class, and quality of the fund supported race program to be 11 
established in this section to carry out the purposes of this section. 12 
(b) These persons shall serve at the pleasure of the corporation and compensation 13 
shall be fixed by the corporation. 14 
(c)[ The compensation of personnel and necessary expenses shall be paid out of 15 
the development fund. 16 
(d)] The corporation shall administer the Kentucky sire stakes program in a 17 
manner best designed to: 18 
1. Promote and aid in the development of the horse industry in Kentucky; 19 
2. Upgrade the quality of racing in Kentucky; and 20 
3. Improve the quality of horses bred in Kentucky. 21 
Section 18.   KRS 230.800 is amended to read as follows: 22 
(1) There is hereby created[ in the State Treasury] a corporate account for the 23 
Kentucky Horse Racing and Gaming Corporation[trust and revolving fund] 24 
designated as the "Kentucky Thoroughbred breeders incentive fund." The fund shall 25 
be administered by the [Kentucky Horse Racing and Gaming ]corporation. For all 26 
tax periods beginning on or after June 1, 2005, eighty percent (80%) of all receipts 27  UNOFFICIAL COPY  	25 RS BR 387 
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collected under KRS 139.531(1)(a) from the sales and use tax on the fees paid for 1 
breeding a stallion to a mare in Kentucky shall be transferred to the corporation 2 
for deposit[deposited] in the fund together with any other money contributed, 3 
appropriated, or allocated to the fund from all other sources.[ The money deposited 4 
in the fund is hereby appropriated for the uses set forth in this section.] Any money 5 
remaining in the fund at the close of any calendar year shall not lapse but shall be 6 
carried forward to the next calendar year. The fund may also receive additional state 7 
appropriations, gifts, grants, and federal funds. All interest earned on money in the 8 
fund shall be credited to the fund. 9 
(2) (a) The Kentucky Horse Racing and Gaming Corporation shall use moneys 10 
deposited in the Kentucky Thoroughbred breeders incentive fund to 11 
administer the fund and provide rewards for breeders of horses bred and 12 
foaled in Kentucky to be divided as follows: 13 
1. At least ninety percent (90%) shall be allocated to provide the breeder 14 
rewards as set forth in this section; and 15 
2. Up to ten percent (10%) may be allocated for administration and 16 
operation of the corporation. 17 
(b) The Kentucky Horse Racing and Gaming Corporation may[shall] promulgate 18 
administrative regulations establishing the conditions and criteria for the 19 
distribution of moneys from the fund. 20 
(c) The Department of Revenue may promulgate administrative regulations 21 
establishing the procedures necessary to determine the correct allocation of 22 
sales tax receipts described in subsection (1) of this section. 23 
(d) As soon as practicable after the close of each calendar year, the corporation 24 
shall disburse to breeders of horses moneys in the Kentucky Thoroughbred 25 
breeders incentive fund pursuant to the administrative regulations 26 
promulgated pursuant to paragraph (b) of this subsection. 27  UNOFFICIAL COPY  	25 RS BR 387 
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Section 19.   KRS 230.802 is amended to read as follows: 1 
(1) There is hereby created[ in the State Treasury] a corporate[trust and revolving] 2 
fund designated as the "Kentucky standardbred breeders incentive fund." The fund 3 
shall be in[administered by] the Kentucky Horse Racing and Gaming Corporation. 4 
For tax periods beginning on or after June 1, 2005, thirteen percent (13%) of all 5 
receipts collected under KRS 139.531(1)(a) from the sales and use tax on the fees 6 
paid for breeding a stallion to a mare in Kentucky shall be deposited in the fund 7 
together with any other money contributed, appropriated, or allocated to the fund 8 
from all other sources. The money deposited in the fund is hereby appropriated for 9 
the uses set forth in this section. Any money remaining in the fund at the close of 10 
any calendar year shall not lapse but shall be carried forward to the next calendar 11 
year. The fund may also receive additional state appropriations, gifts, grants, and 12 
federal funds. All interest earned on money in the fund shall be credited to the fund. 13 
(2) (a) The Kentucky Horse Racing and Gaming Corporation shall use moneys 14 
deposited in the Kentucky standardbred breeders incentive fund to administer 15 
the fund and provide rewards for breeders or owners of Kentucky-bred 16 
standardbred horses to be divided as follows: 17 
1. At least ninety percent (90%) shall be allocated to provide the breeder 18 
rewards as set forth in this section; and 19 
2. Up to ten percent (10%) may be allocated for administration and 20 
operation of the corporation. 21 
(b) The Kentucky Horse Racing and Gaming Corporation may[shall] promulgate 22 
administrative regulations establishing the conditions and criteria for the 23 
distribution of moneys from the fund. 24 
(c) The Department of Revenue may promulgate administrative regulations 25 
establishing the procedures necessary to determine the correct allocation of 26 
sales tax receipts described in subsection (1) of this section. 27  UNOFFICIAL COPY  	25 RS BR 387 
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(d) As soon as practicable after the close of each calendar year, the corporation 1 
shall disburse moneys in the Kentucky standardbred breeders incentive fund 2 
to be used to promote, enhance, improve, and encourage the further and 3 
continued development of the standardbred breeding industry in Kentucky, 4 
under the administrative regulations promulgated pursuant to paragraph (b) of 5 
this subsection. 6 
Section 20.   KRS 230.804 is amended to read as follows: 7 
(1) There is hereby created[ in the State Treasury] a corporate[trust and revolving] 8 
fund designated as the "Kentucky horse breeders incentive fund." The fund shall be 9 
in[administered by] the Kentucky Horse Racing and Gaming Corporation. For tax 10 
periods beginning on or after June 1, 2005, seven percent (7%) of all receipts 11 
collected under KRS 139.531(1)(a) from the sales and use tax on the fees paid for 12 
breeding a stallion to a mare in Kentucky shall be deposited in the fund together 13 
with any other money contributed, appropriated or allocated to the fund from all 14 
other sources. The money deposited in the fund is hereby appropriated for the uses 15 
set forth in this section. Notwithstanding KRS 45.229, any money remaining in the 16 
fund at the close of any calendar year shall not lapse but shall be carried forward to 17 
the next calendar year. The fund may also receive additional state appropriations, 18 
gifts, grants, and federal funds. All interest earned on money in the fund shall be 19 
credited to the fund. 20 
(2) (a) The Kentucky Horse Racing and Gaming Corporation shall use moneys 21 
deposited in the Kentucky horse breeders incentive fund to administer the 22 
fund and provide rewards for breeders or owners of horses bred and foaled in 23 
Kentucky to be divided as follows: 24 
1. At least ninety percent (90%) shall be allocated to provide the breeder 25 
rewards as set forth in this section; and 26 
2. Up to ten percent (10%) may be allocated for administration and 27  UNOFFICIAL COPY  	25 RS BR 387 
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operation of the corporation. 1 
(b) The Kentucky Horse Racing and Gaming Corporation may[shall] promulgate 2 
administrative regulations establishing the conditions and criteria for the 3 
distribution of moneys from the fund. 4 
(c) The Department of Revenue may promulgate administrative regulations 5 
establishing the procedures necessary to determine the correct allocation of 6 
sales tax receipts described in subsection (1) of this section. 7 
(d) As soon as practicable after the close of each calendar year, the corporation 8 
shall disburse to breeders of horses moneys in the Kentucky horse breeders 9 
incentive fund to be used to promote, enhance, improve, and encourage the 10 
further and continued development of the horse industry in Kentucky, under 11 
the administrative regulations promulgated pursuant to paragraph (b) of this 12 
subsection. 13 
Section 21.   KRS 230.811 is amended to read as follows: 14 
(1) Except as provided in KRS 230.805(6), no person shall conduct, manage, or offer to 15 
conduct sports wagering within the Commonwealth of Kentucky without obtaining 16 
a license from the corporation. 17 
(2) As a prerequisite to obtaining a sports wagering license, a person shall be licensed 18 
as an association under KRS 230.300. If sports wagering is conducted by the track 19 
that chooses not to contract with a service provider, it shall comply with the 20 
standards established by the corporation for service providers to ensure the integrity 21 
of the system of sports wagering before conducting sports wagering in the 22 
Commonwealth. 23 
(3) In addition to the requirement in subsection (2) of this section, an initial fee of five 24 
hundred thousand dollars ($500,000) shall be paid to the corporation before a sports 25 
wagering license may be issued to a track. 26 
(4) An annual renewal fee of fifty thousand dollars ($50,000) shall be required for each 27  UNOFFICIAL COPY  	25 RS BR 387 
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sports wagering license. 1 
(5) Licensing fees[ paid] under this section shall be paid to the corporation[deposited 2 
into the sports wagering administration fund established by KRS 230.817]. 3 
Section 22.   KRS 230.817 is amended to read as follows: 4 
(1) (a) There is hereby established in the State Treasury a restricted account to be 5 
known as the sports wagering administration fund. The fund shall consist of 6 
moneys received from the moneys collected under KRS 138.552, 230.811, 7 
and 230.814 and state appropriations. 8 
(b) 1. The amounts deposited in the fund shall be used as follows: 9 
a. Ten percent (10%) of the receipts shall be distributed to the 10 
Kentucky Horse Racing and Gaming Corporation for the 11 
administration and operation of the corporation. The 12 
corporation shall prepare and submit a quarterly report to the 13 
Legislative Research Commission for referral to the Interim 14 
Joint Committee on Licensing, Occupations, and Administrative 15 
Regulations or to the Senate Standing Committee on Licensing 16 
and Occupations and the House Standing Committee on 17 
Licensing, Occupations, and Administrative Regulations, as 18 
appropriate, which includes the amounts received as well as the 19 
expenditures against those funds. This information shall also be 20 
included in the corporation's annual report required by Section 3 21 
of this Act[For administrative expenses relating to or associated 22 
with the purposes of sports wagering which shall be disbursed by 23 
the Finance and Administration Cabinet upon the warrant of the 24 
Kentucky Horse Racing and Gaming Corporation]; and 25 
b. Two and one-half percent (2.5%) of the funds shall be deposited in 26 
the Kentucky problem gambling assistance account established in 27  UNOFFICIAL COPY  	25 RS BR 387 
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KRS 230.826. 1 
2. The remaining funds shall be deposited in the Kentucky permanent 2 
pension fund established in KRS 42.205. 3 
3. Any interest accruing to the fund shall become a part of the fund and 4 
shall not lapse. 5 
(2) Notwithstanding KRS 45.229, fund amounts not expended at the close of a fiscal 6 
year shall not lapse but shall be carried forward into the next fiscal year. 7 
(3) Moneys deposited in the fund shall be:  8 
(a) Used[Are hereby appropriated] for the purposes set forth in this section[ and 9 
shall not be appropriated or transferred by the General Assembly for any other 10 
purposes]; and 11 
(b) Distributed as they are received on a rolling basis. 12 
SECTION 23.   A NEW SECTION OF KRS CHAPTER 238 IS CREATED TO 13 
READ AS FOLLOWS: 14 
Any licensee operating at more locations than allowed under this chapter on July 1, 15 
2025, may retain those licenses, but any of the following events or occurrences shall 16 
result in the loss of the additional licenses: 17 
(1) Sale or transfer of ownership of the business location, property leased for the 18 
gaming location, or change of ownership or transfer of the charitable 19 
organization; 20 
(2) Suspension or revocation of a license due to a violation; 21 
(3) Failure by the licensee to timely reapply or pay appropriate licensure fees; 22 
(4) Any closure of the location for ninety (90) days or more, which shall include 23 
closures due to acts of God; 24 
(5) Failure to maintain a valid lease due to expiration and termination of lease 25 
agreements; 26 
(6) Failure by the licensee to comply with all charitable gaming requirements; 27  UNOFFICIAL COPY  	25 RS BR 387 
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(7) Failure or inability of the existing facility or location to restrict access to persons 1 
twenty-one (21) years of age or older; or 2 
(8) Failure of the licensee to report timely changes to the licensed location or any 3 
licensing requirements to properly update the corporation's licensing files related 4 
to the charitable activities at that location. 5 
Section 24. KRS 238.505 (Effective July 1, 2025) is amended to read as 6 
follows: 7 
As used in this chapter, unless the context requires otherwise: 8 
(1) "Office" means the office regulating charitable gaming within the Kentucky Horse 9 
Racing and Gaming Corporation established by the president under KRS Chapter 10 
230; 11 
(2) "Charitable gaming" means bingo, charity game tickets, raffles, and charity 12 
fundraising events conducted for fundraising purposes by charitable organizations 13 
licensed and regulated under the provisions of this chapter. "Charitable gaming" 14 
shall not include slot machines, electronic video gaming devices, wagering on live 15 
sporting events, or simulcast broadcasts of horse races; 16 
(3) "Charitable organization" means a nonprofit entity organized for charitable, 17 
religious, educational, literary, civic, fraternal, or patriotic purposes; 18 
(4) "Bingo" means a specific game of chance in which participants use cards or paper 19 
sheets, or card-minding device representations thereof, divided into horizontal and 20 
vertical spaces, each of which is designated by a letter and a number, and prizes are 21 
awarded on the basis of the letters and numbers on the card conforming to a 22 
predetermined and preannounced configuration of letters and numbers selected at 23 
random; 24 
(5) "Charity game ticket" means a game of chance using a folded or banded paper 25 
ticket, or a paper card with perforated break-open tabs, or electronic pulltab device 26 
representations thereof, the face of which is covered or otherwise hidden from view 27  UNOFFICIAL COPY  	25 RS BR 387 
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to conceal a number, letter, symbol, or set of numbers, letters, or symbols, some of 1 
which have been designated in advance as prize winners and shall include charity 2 
game tickets that utilize a seal card. "Charity game ticket" shall include pulltabs, 3 
both paper and electronic representations thereof; 4 
(6) "Seal card" means a board or placard used in conjunction with charity game tickets, 5 
that contains a seal or seals which, when removed or opened, reveal predesignated 6 
winning numbers, letters, or symbols; 7 
(7) "Raffle" means a game of chance in which a participant is required to purchase a 8 
ticket for a chance to win a prize, with the winner to be determined by a random 9 
drawing; 10 
(8) "Charity fundraising event" means an activity of limited duration at which games of 11 
chance approved by the corporation[office] are conducted, including bingo, raffles, 12 
charity game tickets, special limited charitable games, and wagering on prerecorded 13 
horse races, KRS Chapter 230 notwithstanding. Examples of such activities include 14 
events that attract patrons for community, social, and entertainment purposes apart 15 
from charitable gaming, such as fairs, festivals, carnivals, licensed charitable 16 
gaming organization conventions, bazaars, and banquets. For the purposes of this 17 
subsection, "banquet" shall mean a formal meal or feast held by a charitable 18 
organization for community, social, or entertainment purposes apart from charitable 19 
gaming; 20 
(9) "Manufacturer" means a person who assembles from raw materials or subparts any 21 
charitable gaming equipment or supplies used in the conduct of charitable gaming, 22 
including a person who converts, modifies, and adds to or removes parts from, 23 
charitable gaming equipment and supplies. The term shall not include: 24 
(a) Any person who services or repairs charitable gaming supplies and 25 
equipment, so long as that person replaces or repairs an incidental, 26 
malfunctioning, or nonfunctioning part with a similar or identical part; and 27  UNOFFICIAL COPY  	25 RS BR 387 
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(b) Any distributor who cuts, collates, and packages for distribution any gaming 1 
supplies and equipment purchased in bulk; 2 
(10) "Distributor" means a person who sells, markets, leases, or otherwise furnishes to a 3 
charitable organization charitable gaming equipment or supplies, or both, used in 4 
the conduct of charitable gaming. "Distributor" shall not include: 5 
(a) A resident printer who prints raffle tickets at the request of a licensed 6 
charitable organization; and 7 
(b) A licensed charitable organization that affects a one-time donation of 8 
charitable gaming supplies or equipment to another licensed charitable 9 
organization if the donation is first approved by the corporation[office]; 10 
(11) "Charitable gaming facility" means the premises on which charitable gaming is 11 
conducted; 12 
(12) "Gross receipts" means all moneys collected or received from the conduct of 13 
charitable gaming; 14 
(13) "Adjusted gross receipts" means gross receipts less all cash prizes and the amount 15 
paid for merchandise prizes purchased; 16 
(14) "Net receipts" means adjusted gross receipts less all expenses, charges, fees, and 17 
deductions authorized under this chapter; 18 
(15) "Charitable gaming supplies and equipment" means any material, device, apparatus, 19 
or paraphernalia customarily used in the conduct of charitable gaming, including 20 
bingo cards and paper, charity game tickets, and other apparatus or paraphernalia 21 
used in conducting games of chance at charity fundraising events subject to 22 
regulation under this chapter. The term shall not include any material, device, 23 
apparatus, or paraphernalia incidental to the game, such as pencils, daubers, playing 24 
cards, or other supplies that may be purchased from normal sources of supply; 25 
(16) "Door prize" means a prize awarded to a person based solely upon the person's 26 
attendance at an event or the purchase of a ticket to attend an event; 27  UNOFFICIAL COPY  	25 RS BR 387 
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(17) "Special limited charitable game" means roulette; blackjack; poker; keno; money 1 
wheel; baccarat; pusher-type games; any dice game where the player competes 2 
against the house; and any other game of chance as identified, defined, and 3 
approved by administrative regulation of the corporation; 4 
(18) "Special limited charity fundraising event" means any type of charity fundraising 5 
event, commonly known as and operated as a "casino night," "Las Vegas night," or 6 
"Monte Carlo night," at which the predominant number or types of games offered 7 
for play are special limited charitable games; 8 
(19) "Session" or "bingo session" means a single gathering at which a bingo game or 9 
series of successive bingo games are played, excluding bingo played at a charity 10 
fundraising event; 11 
(20) "Immediate family" means: 12 
(a) Spouse and parents-in-law; 13 
(b) Parents and grandparents; 14 
(c) Children and their spouses; and 15 
(d) Siblings and their spouses; 16 
(21) "Affiliate" means any corporation, partnership, association, or other business or 17 
professional entity or any natural person that directly or indirectly, through one or 18 
more intermediaries, controls, or is controlled by, or is under common control with 19 
a licensed manufacturer, distributor, or charitable gaming facility; 20 
(22) "Board" means the board of directors of the Kentucky Horse Racing and Gaming 21 
Corporation; 22 
(23) "Corporation" means the Kentucky Horse Racing and Gaming Corporation; 23 
(24)[ "Manager" means the manager of the office regulating charitable gaming 24 
established by the president within the Kentucky Horse Racing and Gaming 25 
Corporation; 26 
(25)] "President" means the president of the Kentucky Horse Racing and Gaming 27  UNOFFICIAL COPY  	25 RS BR 387 
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Corporation; 1 
(25)[(26)] "Chairperson" means the chief executive officer and any officer, member, or 2 
employee of a licensed charitable organization who will be involved in the 3 
management and supervision of charitable gaming as designated in the 4 
organization's charitable gaming license application under KRS 238.535(13)(g); 5 
(26)[(27)] "Year" means calendar year except as used in KRS 238.535(11), 238.545(4), 6 
238.547(1), and 238.555(7), when "year" means the licensee's license year;  7 
(27)[(28)] "Card-minding device" means any mechanical, electronic, electromechanical, 8 
or computerized device that is interfaced with or connected to equipment used to 9 
conduct a game of bingo and that allows a player to store, display, and mark a bingo 10 
card face. A card-minding device shall not be designed and manufactured to 11 
resemble any electronic gaming device that utilizes a video display monitor, such as 12 
a video lottery terminal, video slot machine, video poker machine, or any similar 13 
video gaming device; 14 
(28)[(29)] "Electronic pulltab device" means an electronic device used only for 15 
charitable gaming to facilitate the play of an electronic pulltab. An electronic 16 
pulltab device shall be a tablet or other personal computing device, other than a 17 
mobile phone or similar handheld device, as approved by the corporation[office]. 18 
An electronic pulltab device may only operate on a closed network or intranet that 19 
is confined to the licensee's premises, and shall not be Internet accessible by 20 
patrons, but shall be connected to a central server system solely for the purposes of 21 
monitoring, reporting, accounting, and software maintenance. An electronic pulltab 22 
device shall not be designed and manufactured to resemble any electronic gaming 23 
device that utilizes a video display monitor, such as a video lottery terminal, video 24 
slot machine, video poker machine, or any similar video gaming device; and 25 
(29)[(30)] "Electronic video gaming device," as used in this chapter and the related 26 
administrative regulations, means any device that possesses a video display and 27  UNOFFICIAL COPY  	25 RS BR 387 
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computer mechanism for playing a game. Electronic video gaming device shall not 1 
mean any electronic representation of charitable gaming games identified, defined, 2 
and approved by statute and by administrative regulation of the corporation. 3 
Section 25. KRS 238.510 (Effective July 1, 2025) is amended to read as 4 
follows: 5 
(1) The Office of Charitable Gaming is created as an office within the Kentucky Horse 6 
Racing and Gaming Corporation. Subject to the authority of the corporation, the 7 
office shall license and regulate the conduct of charitable gaming and license and 8 
regulate charitable organizations that desire to engage in charitable gaming, 9 
charitable gaming facilities, manufacturers, and distributors in the Commonwealth 10 
of Kentucky in accordance with the provisions of this chapter. 11 
(2) [The office shall be headed by a manager who shall be appointed by the president. 12 
]The president shall employ necessary staff[ as may be necessary] to administer and 13 
enforce the provisions of this chapter. 14 
(3)[ All office staff shall be classified and employed in accordance with applicable 15 
personnel requirements of the Personnel Cabinet in accordance with KRS Chapter 16 
18A. 17 
(4)] No employee of the corporation[office] during his or her term of employment shall 18 
be an officer in a charitable organization that is licensed to conduct charitable 19 
gaming or be involved in the conduct of charitable gaming as a member of a 20 
licensed charitable organization. No employee of the corporation[office] during his 21 
or her term of employment shall be licensed as a manufacturer, distributor, or 22 
charitable gaming facility, or have a financial interest in any business that is 23 
licensed as a manufacturer, distributor, or charitable gaming facility. 24 
(4)[(5)] The president may[shall] appoint[ charitable gaming] investigators who 25 
may[shall] have the powers of peace officers throughout the Commonwealth; 26 
however, those powers shall be limited to: 27  UNOFFICIAL COPY  	25 RS BR 387 
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(a) Enforcement of the provisions of KRS Chapters 230 and[Chapter] 238[, 1 
relating to charitable gaming]; 2 
(b) Violations of KRS Chapter 528, relating to: 3 
1. Unlicensed and illegal[ charitable] gaming; 4 
2. Gambling offenses committed on licensed[ charitable gaming] premises; 5 
and 6 
3. Gambling offenses committed in conjunction with a legal gaming 7 
activity[charitable gaming]; 8 
(c) Violations of KRS Chapter 514, relating to theft, embezzlement, or other 9 
illegal diversions of legal[charitable] gaming proceeds; 10 
(d) Violations of KRS Chapters 516 and 517, relating to forgery and fraud in the 11 
conduct of legal[charitable] gaming; 12 
(e) Violations relating to the damage or destruction of real or personal property 13 
owned or leased by a[ charitable gaming] licensee; and 14 
(f) Violation of any criminal felony offense committed: 15 
1. On licensed[ charitable] gaming premises; and 16 
2. In the presence of an[a charitable gaming] investigator. 17 
(5)[(6)] [Charitable ]Gaming investigators may[shall] satisfy the certification 18 
standards established by the Department of Criminal Justice Training pursuant to 19 
KRS Chapter 15, but this certification shall not be required for any investigators 20 
hired after the effective date of this section. [The manager may possess peace 21 
officer powers granted under subsection (5) of this section, if he or she is duly 22 
qualified. Charitable ]Gaming investigators shall not qualify for hazardous duty 23 
coverage under the Kentucky Employees Retirement System. 24 
(6)[(7)] [Charitable ]Gaming investigators so appointed shall not possess peace officer 25 
powers other than those provided in subsection (4)[(5)] of this section. 26 
Section 26. KRS 238.515 (Effective July 1, 2025) is amended to read as 27  UNOFFICIAL COPY  	25 RS BR 387 
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follows: 1 
The office shall license and regulate the conduct of charitable gaming in the 2 
Commonwealth of Kentucky as authorized by the corporation. The president may 3 
integrate office responsibilities into other corporation offices to ensure efficiencies and 4 
eliminate duplication of duties. [In discharging this responsibility, the ]Office[ shall have 5 
the following] powers and duties include: 6 
(1) Licensing charitable organizations, charitable gaming facilities, manufacturers, and 7 
distributors that desire to engage in charitable gaming; 8 
(2) Establishing and enforcing reasonable standards for the conduct of charitable 9 
gaming and the operation of charitable gaming facilities; 10 
(3) Prescribing reasonable fees for licenses; 11 
(4) Establishing standards of accounting, recordkeeping, and reporting to insure 12 
charitable gaming receipts are properly accounted for; 13 
(5) Establishing a process for reviewing complaints and allegations of wrongdoing, and 14 
for investigating complaints with merit. In furtherance of this duty, the office may 15 
issue administrative subpoenas and summonses. The office shall also establish toll-16 
free telephone service for receiving complaints and inquiries; 17 
(6) Taking appropriate disciplinary action, subject to the final order of the 18 
corporation[board], and making referrals for criminal prosecution of persons who 19 
do not operate in compliance with this chapter; 20 
(7) Collecting and depositing all fees and fines in the charitable gaming regulatory 21 
account to be administered by the corporation[and administering the account]; and 22 
(8)[ Employing necessary staff, securing adequate office space, and executing other 23 
administrative and logistical matters to assure proper functioning of the office; and 24 
(9)] Proposing administrative regulations which are necessary to carry out the purposes 25 
and intent of this chapter.[ Any administrative regulation proposed by the office 26 
that changes the manner in which a charitable organization conducts charitable 27  UNOFFICIAL COPY  	25 RS BR 387 
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gaming or is likely to cause a charitable organization to incur new or additional 1 
costs shall be subject to the requirements of KRS 238.522.] In proposing 2 
administrative regulations under this subsection, the office shall submit any 3 
proposed regulations to the Kentucky Horse Racing and Gaming Corporation[ and 4 
the advisory council established under KRS 238.520, and shall give the advisory 5 
council the opportunity to produce written comments in accordance with KRS 6 
238.522 prior to submitting the proposed administrative regulations to the Kentucky 7 
Horse Racing and Gaming Corporation. If the advisory council chooses to produce 8 
written comments, the comments shall be attached to any public submission of the 9 
administrative regulation, including any filing under KRS Chapter 13A]. 10 
Section 27. KRS 238.525 (Effective July 1, 2025) is amended to read as 11 
follows: 12 
(1) Licenses shall be issued by the office on an annual[ or biennial] basis, except as 13 
otherwise permitted in KRS 238.530 and 238.545. A license term may be 14 
determined by the office in any manner it deems appropriate to facilitate efficient 15 
licensing. The office shall charge a renewal fee not to exceed the maximum 16 
amounts established in KRS 238.530, 238.535, and 238.555. 17 
(2) The office may issue a temporary license to an applicant who has met the 18 
requirements for a license. A temporary license shall be valid from the date of 19 
issuance until the regular license is issued or for a period of sixty (60) days, 20 
whichever is shorter. A temporary license shall not be renewed, except for good 21 
cause and shall not exceed a total of nine (9) months in length. 22 
(3) An applicant for any license to be issued under KRS 238.530 and 238.555 shall be 23 
subjected to a state and national criminal history background check by the office, 24 
with the assistance of the Department of Kentucky State Police and the Federal 25 
Bureau of Investigation. An applicant for any license to be issued under KRS 26 
238.535 shall be subjected to a state criminal history background check and may, if 27  UNOFFICIAL COPY  	25 RS BR 387 
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deemed reasonably necessary, be subjected to a national criminal history 1 
background check by the office with the assistance of the Department of Kentucky 2 
State Police and the Federal Bureau of Investigation. The criminal history 3 
background check shall apply to the chief executive officer and the chief financial 4 
officer or director of an applicant; any employee or member of an applicant who 5 
has been designated as chairperson of the charitable gaming activity; the applicant 6 
itself; and any individual with a ten percent (10%) or more financial interest in the 7 
applicant. The office shall require the fingerprinting of all applicants for licensure 8 
under KRS 238.530 and 238.555 and may require, if deemed reasonably necessary, 9 
the fingerprints of all applicants for licensure under KRS 238.535, who are natural 10 
persons in connection with the national criminal history background check to assure 11 
the identity of the applicant or applicants. The office may charge a reasonable fee 12 
not to exceed the actual cost of fingerprinting and records searching. 13 
(4) No applicant shall be licensed and no license holder shall be able to maintain a 14 
license if an individual associated with the applicant or license holder in a capacity 15 
listed in subsection (3) of this section or the applicant or license holder itself has 16 
been convicted of a felony, gambling offense, criminal fraud, forgery, theft, 17 
falsifying business records, violation of KRS 238.995(7), or any two (2) 18 
misdemeanor crimes in federal court or the courts of any state, the District of 19 
Columbia, or any territory, consistent with the provisions of KRS Chapter 335B 20 
within ten (10) years preceding the application for licensure. 21 
(5) No applicant shall be licensed unless all applicants required to be fingerprinted 22 
under the provision of subsection (3) of this section have been fingerprinted. The 23 
Department of Kentucky State Police may submit fingerprints of any applicant to 24 
the Federal Bureau of Investigation for the national criminal history background 25 
check. The corporation may by administrative regulation impose additional 26 
qualifications to meet the requirements of Pub. L. No. 92-544. 27  UNOFFICIAL COPY  	25 RS BR 387 
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(6) If a change occurs in any information submitted during the license application 1 
process, the applicant or licensee shall notify the office in writing within thirty (30) 2 
days of the date the change occurred. 3 
Section 28. KRS 238.535 (Effective July 1, 2025) is amended to read as 4 
follows: 5 
(1) (a) Any charitable organization conducting charitable gaming in the 6 
Commonwealth of Kentucky shall be licensed by the corporation[office]. A 7 
charitable organization qualifying under subsection (12) of this section but not 8 
exceeding the limitations provided in this subsection shall be exempt from the 9 
licensure requirements when conducting the following charitable gaming 10 
activities: 11 
1.[(a)] Bingo in which the gross receipts do not exceed a total of twenty-12 
five thousand dollars ($25,000) per year; 13 
2.[(b)] A raffle or raffles for which the gross receipts do not exceed 14 
twenty-five thousand dollars ($25,000) per year; and 15 
3.[(c)] A charity fundraising event or events that do not involve special 16 
limited charitable games and the gross gaming receipts for which do not 17 
exceed twenty-five thousand dollars ($25,000) per year. 18 
 However, at no time shall a charitable organization's total limitations under 19 
this subsection exceed twenty-five thousand dollars ($25,000). 20 
(b) A charitable entity organized within the Commonwealth of Kentucky for the 21 
benefit of a public or private elementary or secondary school organized 22 
within the Commonwealth of Kentucky shall be exempt from the licensure 23 
requirements of this section when conducting any charitable gaming 24 
activities. A charitable entity that qualifies under this paragraph shall: 25 
1. Have no limit on authorized gross receipts; 26 
2. Be exempt from any application requirements under this chapter; and 27  UNOFFICIAL COPY  	25 RS BR 387 
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3. Submit a summary report to the office showing, at a minimum, the 1 
charitable gaming activities conducted and the gross receipts, adjusted 2 
gross receipts, net receipts on each activity within sixty (60) days after 3 
conducting the activity, and any other information requested by the 4 
office. 5 
(c) A charitable entity that qualifies under paragraph (b) of this subsection 6 
shall: 7 
1. Retain net receipts for the charitable purpose equal to or greater than 8 
forty percent (40%) of the adjusted gross receipts of the charitable 9 
entity in the same manner required by Section 46 of this Act; 10 
2. Expend net receipts exclusively for purposes consistent with its status 11 
as a charitable entity organized for the benefit of a public or private 12 
elementary or secondary school; and 13 
3. Maintain accurate records and books for a period of three (3) years. 14 
Corporation staff shall have access to these records at reasonable 15 
times. The charitable entity shall maintain its charitable gaming 16 
records at its office or place of business within the Commonwealth of 17 
Kentucky as identified in its summary reports. The charitable entity 18 
shall submit a yearly financial report. 19 
(2) (a) Any charitable organization exempt from the process of applying for a license 20 
under subsection (1) of this section, shall notify the office in writing, on a 21 
simple form issued by the office, of its intent to engage in exempt charitable 22 
gaming and the address at which the gaming is to occur. Any charitable 23 
organization exempt from the process of applying for a license under 24 
subsection (1) of this section, shall comply with all other provisions of this 25 
chapter relating to the conduct of charitable gaming, except: 26 
1. Payment of the fee imposed under the provisions of KRS 238.570; and 27  UNOFFICIAL COPY  	25 RS BR 387 
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2. The quarterly reporting requirements imposed under the provisions of 1 
KRS 238.550(7), unless the exempt charitable organization obtains a 2 
retroactive license pursuant to subsection (9) of this section. 3 
(b) Before January 31 of the year immediately following the year of exemption, a 4 
charitable organization exempt from licensure under the provisions of 5 
subsection (1) of this section shall file a financial report with the office, on a 6 
form issued by the office, that contains the following information: 7 
1. The type of gaming activity in which it engaged during that year; 8 
2. The total gross receipts derived from gaming; 9 
3. The amount of charitable gaming expenses paid; 10 
4. The amount of net receipts derived; and 11 
5. The disposition of those net receipts. 12 
(3) An exemption that has been granted to a charitable organization for the preceding 13 
calendar year shall be automatically renewed on January 1 of the following year. 14 
(4) If upon receipt of the financial report the office determines that the information 15 
appearing on the financial report renders the charitable organization ineligible to 16 
possess an exemption, the office shall notify the charitable organization that its 17 
exemption is rescinded. The organization may request an appeal of this rescission 18 
pursuant to KRS 238.565. 19 
(5) If the annual financial report is not received by January 31, the exemption is 20 
automatically rescinded unless an extension of no more than thirty (30) days is 21 
granted by the office. The organization may request an appeal of this rescission 22 
pursuant to KRS 238.565. 23 
(6) If an exemption is revoked because an organization has exceeded the limit imposed 24 
in subsection (1) of this section, the organization shall apply for a retroactive 25 
license in accordance with subsection (7) of this section. 26 
(7) If an organization exceeds the limit imposed by any subsection of this section it 27  UNOFFICIAL COPY  	25 RS BR 387 
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shall: 1 
(a) Report the amount to the office; and 2 
(b) Apply for a retroactive charitable gaming license. 3 
(8) Upon receipt of a report and application for a retroactive charitable gaming license, 4 
the office shall investigate to determine if the organization is otherwise qualified to 5 
hold the license. 6 
(9) If the office determines that the applicant is qualified, it shall issue a charitable 7 
gaming license retroactive to the date on which the exemption limit was exceeded. 8 
The retroactive charitable gaming license shall be issued in the same manner as 9 
regular charitable gaming licenses. 10 
(10) If the office determines that the applicant is not qualified it shall deny the license 11 
and take enforcement action, if appropriate. 12 
(11) Once a retroactive or regular gaming license is issued to an organization, that 13 
organization shall not be eligible for exempt status in the future and shall maintain a 14 
charitable gaming license if it intends to continue charitable gaming activities, 15 
unless the charitable organization has not exceeded the exemption limitations of 16 
subsection (1) of this section for a period of two (2) years prior to its exemption 17 
request. 18 
(12) (a) In order to qualify for licensure, a charitable organization shall: 19 
1. a. Possess a tax exempt status under 26 U.S.C. secs. 501(c)(3), 20 
501(c)(4), 501(c)(8), 501(c)(10), or 501(c)(19), or be covered 21 
under a group ruling issued by the Internal Revenue Service under 22 
authority of those sections; or 23 
b. Be organized within the Commonwealth of Kentucky[ as a 24 
common school as defined in KRS 158.030,] as an institution of 25 
higher education as defined in KRS 164A.305[,] or as a state 26 
college or university as provided for in KRS 164.290; 27  UNOFFICIAL COPY  	25 RS BR 387 
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2. Have been established and continuously operating within the 1 
Commonwealth of Kentucky for charitable purposes, other than the 2 
conduct of charitable gaming, for a period of three (3) years prior to 3 
application for licensure. For purposes of this paragraph, an applicant 4 
shall demonstrate establishment and continuous operation in Kentucky 5 
by its conduct of charitable activities from an office physically located 6 
within Kentucky both during the three (3) years immediately preceding 7 
its application for licensure and at all times during which it possesses a 8 
charitable gaming license. However, a charitable organization that 9 
operates for charitable purposes in more than ten (10) states and whose 10 
principal place of business is physically located in a state other than 11 
Kentucky may satisfy the requirements of this paragraph if it can 12 
document that it has: 13 
a. Been actively engaged in charitable activities and has made 14 
reasonable progress, as defined in subparagraph 3. of this 15 
paragraph, in the conduct of charitable activities or the expenditure 16 
of funds within Kentucky for a period of three (3) years prior to 17 
application for licensure; and 18 
b. Operated for charitable purposes from an office or place of 19 
business in the Kentucky county where it proposes to conduct 20 
charitable gaming for at least one (1) year prior to application for 21 
licensure, in accordance with subparagraph 4. of this paragraph 22 
and paragraph (c) of this subsection; 23 
3. Have been actively engaged in charitable activities during the three (3) 24 
years immediately prior to application for licensure and be able to 25 
demonstrate, to the satisfaction of the office, reasonable progress in 26 
accomplishing its charitable purposes during this period. As used in this 27  UNOFFICIAL COPY  	25 RS BR 387 
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paragraph, "reasonable progress in accomplishing its charitable 1 
purposes" means the regular and uninterrupted conduct of activities 2 
within the Commonwealth or the expenditure of funds within the 3 
Commonwealth to accomplish relief of poverty, advancement of 4 
education, protection of health, relief from disease, relief from suffering 5 
or distress, protection of the environment, conservation of wildlife, 6 
advancement of civic, governmental, or municipal purposes, or 7 
advancement of those purposes delineated in KRS 238.505(3). In order 8 
to demonstrate reasonable progress in accomplishing its charitable 9 
purposes when applying to renew an existing license, a licensed 10 
charitable organization shall additionally provide to the office a detailed 11 
accounting regarding its expenditure of charitable gaming net receipts 12 
for the purposes described in this paragraph; and 13 
4. Have maintained an office or place of business, other than for the 14 
conduct of charitable gaming, for at least one (1) year in the county in 15 
which charitable gaming is to be conducted. The office or place of 16 
business shall be a separate and distinct address and location from that 17 
of any other licensee of the Office of Charitable Gaming; except that up 18 
to three (3) licensed charitable organizations may have the same address 19 
if they legitimately share office space. 20 
(b) 1. A charitable organization that has established and maintained an office 21 
or place of business in the county for a period of at least one (1) year 22 
may hold a raffle drawing or a charity fundraising event, including 23 
special limited charity fundraising events, in a Kentucky county other 24 
than that in which the organization's office or place of business is 25 
located. 26 
2. For raffles, the organization shall notify the Office of Charitable 27  UNOFFICIAL COPY  	25 RS BR 387 
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Gaming in writing of the organization's intent to change the drawing's 1 
location at least thirty (30) days before the drawing takes place. This 2 
written notification: 3 
a. May be transmitted in any commercially reasonable means, 4 
authorized by the office, including facsimile and electronic mail; 5 
and 6 
b. Shall set out the place and the county in which the drawing will 7 
take place. 8 
 Approval by the office shall be received prior to the conduct of the raffle 9 
drawing at the new location. 10 
(c) Any charitable organization that was registered with the county clerk to 11 
conduct charitable gaming in a county on or before March 31, 1992, shall 12 
satisfy the requirement contained in paragraph (a)4. of this subsection if it 13 
maintained a place of business or operation, other than for the conduct of 14 
charitable gaming, for one (1) year prior to application in a Kentucky county 15 
adjoining the county in which they were registered. 16 
(13) In applying for a license, the information to be submitted shall include but not be 17 
limited to the following: 18 
(a) The name and address of the charitable organization; 19 
(b) The date of the charitable organization's establishment in the Commonwealth 20 
of Kentucky and the date of establishment in the county or counties in which 21 
charitable gaming is to be conducted; 22 
(c) A statement of the charitable purpose or purposes for which the organization 23 
was organized. If the charitable organization is incorporated, a copy of the 24 
articles of incorporation shall satisfy this requirement; 25 
(d) A statement explaining the organizational structure and management of the 26 
organization. For incorporated entities, a copy of the organizations' bylaws 27  UNOFFICIAL COPY  	25 RS BR 387 
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shall satisfy this requirement; 1 
(e) A detailed accounting of the charitable activities in which the charitable 2 
organization has been engaged for the three (3) years preceding application 3 
for licensure; 4 
(f) The names, addresses, dates of birth, and Social Security numbers of all 5 
officers of the organization; 6 
(g) The names, addresses, dates of birth, and Social Security numbers of all 7 
employees and members of the charitable organization who will be involved 8 
in the management and supervision of charitable gaming. No fewer than two 9 
(2) employees or members of the charitable organization who are involved in 10 
the management and supervision of charitable gaming, along with the chief 11 
executive officer or the director of the applicant organization, shall be 12 
designated as chairpersons; 13 
(h) The address of the location at which charitable gaming will be conducted and 14 
the name and address of the owner of the property, if it is owned by a person 15 
other than the charitable organization; 16 
(i) A copy of the letter or other legal document issued by the Internal Revenue 17 
Service to grant tax-exempt status; 18 
(j) A statement signed by the presiding or other responsible officer of the 19 
charitable organization attesting that the information submitted in the 20 
application is true and correct and that the organization agrees to comply with 21 
all applicable laws and administrative regulations regarding charitable 22 
gaming; 23 
(k) An agreement that the charitable organization's records may be released by 24 
the Federal Internal Revenue Service to the office; and 25 
(l) Any other information the office deems appropriate. 26 
(14) (a) An organization or a group of individuals that does not meet the licensing 27  UNOFFICIAL COPY  	25 RS BR 387 
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requirements of subsection (12) of this section may hold a raffle if: 1 
1. The gross receipts do not exceed five hundred dollars ($500); 2 
2. All proceeds from the raffle are distributed to a charitable organization; 3 
and 4 
3. The organization or group of individuals holds no more than three (3) 5 
raffles each year; 6 
 and shall be exempt from complying with the notification, application, and 7 
reporting requirements of subsections (2) and (13) of this section. 8 
(b) An organization or a group of individuals that does not meet the licensing 9 
requirements of subsection (12) of this section may hold a raffle if: 10 
1. The organization holds a special event raffle license issued by the office 11 
and complies with the regulatory requirements in this chapter, including 12 
but not limited to the quarterly reporting requirements of KRS 13 
238.550(7), the retention requirements of KRS 238.536,  and payment of 14 
the fee imposed by KRS 238.570; 15 
2. The organization possesses a tax-exempt status under 26 U.S.C. sec. 16 
501(c)(7); 17 
3. The organization holds no more than twelve (12) raffles per year; 18 
4. Each raffle complies with the office's raffle standards in KRS 238.545 19 
and administrative regulations promulgated thereunder and is approved 20 
by the office in writing prior to the sale of the first raffle ticket; 21 
5. The gross receipts of each raffle do not exceed five hundred thousand 22 
dollars ($500,000); and 23 
6. One hundred percent (100%) of the net receipts of each raffle shall be 24 
distributed to a charitable organization licensed by the office pursuant to 25 
subsection (12) of this section to conduct charitable gaming as follows: 26 
a. All distributed net receipts shall be maintained by the recipient 27  UNOFFICIAL COPY  	25 RS BR 387 
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licensed charitable organization in a separate account to be 1 
designated as the "raffle recipient account"; 2 
b. All distributed net receipts shall be expended by the recipient 3 
licensed charitable organization to further the charitable purpose of 4 
the recipient licensed charitable organization as required by KRS 5 
238.550(4); and  6 
c. All distributed net receipts, and the expenditure thereof, shall be 7 
reported to the office and be subject to the office's auditing and 8 
investigative authority consistent with the provisions of this 9 
chapter. 10 
(c) An applicant qualifying under paragraph (b) of this subsection shall submit an 11 
application for a special event raffle license, and the information to be 12 
submitted shall include but not be limited to the following:  13 
1. The name and address of the organization; 14 
2. The date of the organization's establishment in the Commonwealth of 15 
Kentucky and the date of the organization's establishment in the county 16 
or counties in which charitable gaming is to be conducted; 17 
3. A statement of the purpose or purposes for which the organization was 18 
organized and identification of the licensed charitable organization to 19 
which the applicant will distribute its net receipts. If the organization is 20 
incorporated, a copy of the articles of incorporation shall satisfy this 21 
requirement; 22 
4. A statement explaining the organizational structure and management of 23 
the organization. For incorporated entities, a copy of the organization's 24 
bylaws shall satisfy this requirement; 25 
5. The names, addresses, dates of birth, and Social Security numbers of all 26 
officers of the organization; 27  UNOFFICIAL COPY  	25 RS BR 387 
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6. The names, addresses, dates of birth, and Social Security numbers of all 1 
employees and members of the organization who will be involved in the 2 
management and supervision of charitable gaming. No fewer than two 3 
(2) employees or members of the organization who are involved in the 4 
management and supervision of charitable gaming, along with the chief 5 
executive officer or the director of the applicant organization, shall be 6 
designated as chairpersons; 7 
7. The address of the location at which charitable gaming will be 8 
conducted and the name and address of the owner of the property, if it is 9 
owned by a person other than the organization; 10 
8. A copy of the letter or other legal document issued by the Internal 11 
Revenue Service to grant tax-exempt status; 12 
9. A statement signed by the presiding or other responsible officer of the 13 
organization attesting that the information submitted in the application is 14 
true and correct and that the organization agrees to comply with all 15 
applicable laws and administrative regulations regarding charitable 16 
gaming; 17 
10. An agreement that the organization's records may be released by the 18 
federal Internal Revenue Service to the office; and 19 
11. Any other information as determined by the corporation through the 20 
promulgation of administrative regulations. 21 
(15) The office may issue a license for a specified period of time, based on the type of 22 
charitable gaming involved and the desired duration of the activity. 23 
(16) The office shall charge a fee for each license issued and renewed, not to exceed 24 
three hundred dollars ($300). Specific fees to be charged may[shall] be prescribed 25 
in a graduated scale promulgated by administrative regulations of the corporation 26 
and based on type of license, type of charitable gaming, actual or projected gross 27  UNOFFICIAL COPY  	25 RS BR 387 
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receipts, or other applicable factors, or combination of factors. 1 
(17) (a) A licensed charitable organization may place its charitable gaming license in 2 
escrow if: 3 
1. The licensee notifies the office in writing that it desires to place its 4 
license in escrow; and 5 
2. The license is in good standing and the office has not initiated 6 
disciplinary action against the licensee. 7 
(b) During the escrow period, the licensee shall not engage in charitable gaming, 8 
and the escrow period shall not be included in calculating the licensee's 9 
retention rate under KRS 238.536. 10 
(c) A charitable organization may apply for reinstatement of its active license and 11 
the license shall be reinstated provided: 12 
1. The charitable organization continues to qualify for licensure; 13 
2. The charitable organization has not engaged in charitable gaming during 14 
the escrow period; and 15 
3. The charitable organization pays a reinstatement fee established by the 16 
office. 17 
Section 29. KRS 238.545 (Effective July 1, 2025) is amended to read as 18 
follows: 19 
(1) A licensed charitable organization shall be limited by the following: 20 
(a) In the conduct of bingo, to one (1) session per day, two (2) sessions per week, 21 
for a period not to exceed five (5) consecutive hours in any day and not to 22 
exceed ten (10) total hours per week: 23 
1. No licensed charitable organization shall conduct bingo at more than 24 
one (1) location during the same twenty-four (24) hour period; 25 
2. No licensed charitable organization shall award prizes for bingo that 26 
exceed five thousand dollars ($5,000) in fair market value per twenty-27  UNOFFICIAL COPY  	25 RS BR 387 
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four (24) hour period, including the value of door prizes; and 1 
3. No person under the age of eighteen (18) shall be permitted to purchase 2 
bingo supplies or play bingo unless he or she is playing for noncash 3 
prizes and is accompanied by a parent or legal guardian and only if the 4 
value of any noncash prize awarded does not exceed ten dollars ($10); 5 
(b) 1. A licensed charitable organization may provide card-minding devices 6 
for use by players of bingo games. 7 
2. If a licensed charitable organization offers card-minding devices for use 8 
by players, the devices shall be capable of being used in conjunction 9 
with bingo cards or paper sheets at all times. 10 
3. Subject to the authority of the corporation, the office shall have broad 11 
authority to define and regulate the use of card-minding devices and the 12 
corporation may[shall] promulgate an administrative regulation 13 
concerning use and control of them; 14 
(c) Charity game tickets shall be sold only at the address of the location 15 
designated on the license to conduct charitable gaming; 16 
(d) Charity game tickets may be sold, with prior approval of the office: 17 
1. At any authorized special charity fundraising event conducted by a 18 
licensed charitable organization at any off-site location; or 19 
2. By a licensed charitable organization possessing a special limited 20 
charitable gaming license at any off-site location; and 21 
(e) An automated charity game ticket dispenser may be utilized by a licensed 22 
charitable organization, with the prior approval of the office, only at the 23 
address of the location designated on the license to conduct charitable gaming. 24 
The corporation may[shall] promulgate administrative regulations regulating 25 
the use and control of approved automated charity game ticket dispensers. 26 
(2) (a) No prize for an individual charity game ticket shall exceed five hundred 27  UNOFFICIAL COPY  	25 RS BR 387 
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ninety-nine dollars ($599) in value, not including the value of cumulative or 1 
carryover prizes awarded in seal card games. 2 
(b) Cumulative or carryover prizes in seal card games shall not exceed two 3 
thousand four hundred dollars ($2,400). 4 
(c) Information concerning rules of the particular game and prizes that are to be 5 
awarded in excess of fifty dollars ($50) in each separate package or series of 6 
packages with the same serial number and all rules governing the handling of 7 
cumulative or carryover prizes in seal card games shall be posted prominently 8 
in an area where charity game tickets are sold. A legible poster that lists prizes 9 
to be awarded, and on which prizes actually awarded are posted at the 10 
completion of the sale of each separate package shall satisfy this requirement. 11 
(d) Any unclaimed money or prize shall return to the charitable organization. 12 
(e) No paper charity game ticket shall be sold in the Commonwealth of Kentucky 13 
that does not conform to the standards for opacity, randomization, minimum 14 
information, winner protection, color, and cutting established by the office. 15 
(f) No electronic pulltab device representation of a charity game ticket shall be 16 
sold in the Commonwealth of Kentucky that does not conform to the 17 
construction standards set forth in an administrative regulation promulgated 18 
by the corporation. Electronic pulltab devices shall only be used for charitable 19 
gaming. 20 
(g) No person under the age of eighteen (18) shall be permitted to purchase, or 21 
open in any manner, a charity game ticket. 22 
(3) (a) Tickets for a raffle shall be sold separately, and each ticket shall constitute a 23 
separate and equal chance to win. 24 
(b) All raffle tickets shall be sold for the price stated on the ticket, and no person 25 
shall be required to purchase more than one (1) ticket or to pay for anything 26 
other than a ticket to enter a raffle. 27  UNOFFICIAL COPY  	25 RS BR 387 
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(c) Raffle tickets and tickets for charity fundraising raffle games approved by the 1 
office which are offered exclusively at charity fundraising events and special 2 
limited charity fundraising events are not required to be sold separately and 3 
may be sold at discounted package rates. 4 
(d) Raffle tickets shall have a unique identifier on each ticket. 5 
(e) Winners shall be drawn at random at a date, time, and place announced in 6 
advance or printed on the ticket. 7 
(f) All prizes for a raffle shall be identified in advance of the drawing and all 8 
prizes identified shall be awarded. 9 
(4) With respect to charity fundraising events, a licensed charitable organization shall 10 
be limited as follows: 11 
(a) No licensed charitable organization shall conduct a charity fundraising event 12 
or a special limited charity fundraising event unless they have a license for the 13 
respective event issued by the office; 14 
(b) No special license shall be required for any wheel game, such as a cake wheel, 15 
that awards only noncash prizes the value of which does not exceed one 16 
hundred dollars ($100); 17 
(c) The office may grant approval for a licensed charitable organization to play 18 
bingo games at a charity fundraising event. Cash prizes for bingo games 19 
played during a charity fundraising event may not exceed five thousand 20 
dollars ($5,000) for the entire event. No person under the age of eighteen (18) 21 
shall be permitted to play bingo at a charity fundraising event unless 22 
accompanied by a parent or legal guardian; 23 
(d) The office may grant approval for a licensed charitable organization to play 24 
special limited charitable games at a charity fundraising event authorized 25 
under this section. The office shall not grant approval for the playing of 26 
special limited charitable games under the provisions of a charity fundraising 27  UNOFFICIAL COPY  	25 RS BR 387 
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event license unless the proposed event meets the definition of a charity 1 
fundraising event held for community, social, or entertainment purposes apart 2 
from charitable gaming in accordance with KRS 238.505(8); 3 
(e) Except for state, county, city fairs, and special limited charity fundraising 4 
events, a charity fundraising event license issued under this section shall not 5 
exceed seventy-two (72) consecutive hours. A licensed charitable 6 
organization shall not be eligible for more than eight (8) total charity 7 
fundraising event licenses per year, including two (2) special limited charity 8 
fundraising event licenses. No person under eighteen (18) years of age shall 9 
be allowed to play or conduct any special limited charitable game. Subject to 10 
the authority of the corporation, the office shall have broad authority to 11 
regulate the conduct of special limited charity fundraising events in 12 
accordance with the provisions of KRS 238.547; and 13 
(f) Charity fundraising events may be held: 14 
1. On or in the premises of a licensed charitable organization; 15 
2. In a licensed charitable gaming facility, subject to restrictions contained 16 
in KRS 238.555(7); or 17 
3. At an unlicensed facility which shall be subject to the requirements 18 
stipulated in KRS 238.555(3), and subject to the restrictions contained in 19 
KRS 238.547(2). 20 
(5) Presentation of false, fraudulent, or altered identification by a minor shall be an 21 
affirmative defense in any disciplinary action or prosecution that may result from a 22 
violation of age restrictions contained in this section, if the appearance and 23 
character of the minor were such that his or her age could not be reasonably 24 
ascertained by other means. 25 
Section 30. KRS 238.565 (Effective July 1, 2025) is amended to read as 26 
follows: 27  UNOFFICIAL COPY  	25 RS BR 387 
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(1) A license holder may appeal any administrative action taken under KRS 238.560. A 1 
license holder shall be notified in writing of any action to be taken against him or 2 
her. The notification may be delivered in person or mailed by certified mail, return 3 
receipt requested, to the last known address of the license holder. Service of 4 
notification of administrative action, whether by hand delivery or by certified mail, 5 
shall be deemed complete if the license holder fails or refuses to accept delivery. 6 
For service by hand delivery, notification shall be deemed received upon 7 
acceptance of delivery or upon failure or refusal to accept delivery, and the person 8 
affecting service on behalf of the office shall record the fact of the failure or refusal. 9 
For service by certified mail, the notification of administrative action shall be 10 
deemed received when the license holder accepts delivery or fails or refuses to 11 
accept delivery at the last known address. The notification shall specify the charges 12 
against the license holder, specify the proposed administrative sanction, and advise 13 
the license holder of the right to appeal the decision within ten (10) days of the date 14 
of receipt of the notification. 15 
(2) Upon receipt of an appeal, the corporation[board] shall schedule the matter for an 16 
administrative hearing that shall be conducted in accordance with KRS Chapter 17 
13B. 18 
(3) Any provisions of KRS Chapter 13B notwithstanding, within twenty (20) days after 19 
the conclusion of a hearing, the hearing officer shall prepare and present to the 20 
corporation[board] a recommended order based on findings of fact and conclusions 21 
of law. Within thirty (30) days of receipt of the recommended order, the 22 
corporation[board] shall affirm, reject, or modify, in whole or in part, the 23 
recommended order and shall issue a final order. The final order shall be the final 24 
administrative action on the matter and a copy of the final order shall be mailed to 25 
the license holder, by certified mail, return receipt requested. 26 
(4) Pursuant to KRS 13B.120(7), the corporation[board] shall automatically hear and 27  UNOFFICIAL COPY  	25 RS BR 387 
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issue a final order regarding any decision of the corporation[office] that would 1 
otherwise be subject to appeal.  2 
(5) Any administrative action taken under this section shall, upon appeal, be stayed 3 
until a final order is issued, with the exception of a summary suspension. The 4 
corporation[board] may issue an emergency order pursuant to KRS 13B.125 to 5 
summarily suspend a license upon finding that continued operation of the license 6 
holder pending a hearing would constitute a threat to the public health, safety, or 7 
welfare. 8 
(6) A final order of the corporation[board] may be appealed to the Circuit Court of the 9 
county where the appellant works or resides in accordance with KRS Chapter 13B. 10 
If the license holder against whom administrative action is proposed does not 11 
request an appeal of the action, the corporation[board] shall enter a final order 12 
imposing the proposed administrative action. 13 
Section 31.  KRS 238.570 (Effective July 1, 2025) is amended to read as 14 
follows: 15 
(1) A fee is imposed on charitable gaming in the amount of fifty-three hundredths of 16 
one percent (0.53%) of gross receipts derived from all charitable gaming conducted 17 
by charitable organizations required to be licensed in the Commonwealth of 18 
Kentucky.[ The amount of the fee shall be adjusted by October 1 of each odd-19 
numbered year in accordance with subsection (3) of this section.] Each licensed 20 
charitable organization shall remit to the corporation[office] all moneys due[ as set 21 
forth in administrative regulations promulgated by the corporation]. Failure by a 22 
licensed charitable organization to timely remit the fee required under this 23 
subsection upon notice of delinquency shall constitute grounds for disciplinary 24 
action in accordance with KRS 238.560. 25 
(2) The charitable gaming regulatory account is hereby created as a 26 
corporate[revolving] account within the agency revenue fund and under the control 27  UNOFFICIAL COPY  	25 RS BR 387 
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of the Kentucky Horse Racing and Gaming Corporation. All revenues generated 1 
from the fee levied in subsection (1) of this section from license fees and from 2 
administrative fines imposed by the office shall be deposited in this account. Fund 3 
amounts attributable to the fee levied in subsection (1) of this section that are not 4 
expended at the close of a fiscal year shall not lapse but shall be carried forward to 5 
the next fiscal year. 6 
[(3) (a) No later than July 31 of each odd-numbered year, the Kentucky Horse Racing 7 
and Gaming Corporation shall determine: 8 
1. The amount of gross receipts during the prior biennium against which 9 
the fee collected under subsection (1) of this section was assessed; and 10 
2. The final budgeted amount as determined by the enacted budget for the 11 
upcoming biennium for the administration and enforcement of the 12 
provisions of this chapter. If a budget is not enacted, the amount shall be 13 
the corresponding amount in the last enacted budget. 14 
(b) On October 1 of each odd-numbered year, the fee assessed under subsection 15 
(1) of this section shall be proportionally adjusted by the Kentucky Horse 16 
Racing and Gaming Corporation. The new rate shall be calculated by 17 
multiplying one hundred ten percent (110%) by the amount determined in 18 
paragraph (a)2. of this subsection, and subtracting from that amount one-half 19 
(1/2) of any remaining balance in the account. The total shall then be divided 20 
by the amount determined in paragraph (a)1. of this subsection. The result 21 
shall be expressed as a percentage and shall be rounded to the nearest 22 
thousandth of a percent (0.000%).] 23 
Section 32.   KRS 18A.115 is amended to read as follows: 24 
(1) The classified service to which KRS 18A.005 to 18A.200 shall apply shall comprise 25 
all positions in the state service now existing or hereafter established, except the 26 
following: 27  UNOFFICIAL COPY  	25 RS BR 387 
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(a) The General Assembly and employees of the General Assembly, including the 1 
employees of the Legislative Research Commission; 2 
(b) Officers elected by popular vote and persons appointed to fill vacancies in 3 
elective offices; 4 
(c) Members of boards and commissions; 5 
(d) Officers and employees on the staff of the Governor, the Lieutenant 6 
Governor, the Office of the Secretary of the Governor's Cabinet, and the 7 
Office of Program Administration; 8 
(e) Cabinet secretaries, commissioners, office heads, and the administrative heads 9 
of all boards and commissions, including the executive director of Kentucky 10 
Educational Television; 11 
(f) Employees of Kentucky Educational Television who have been determined to 12 
be exempt from classified service by the Kentucky Authority for Educational 13 
Television, which shall have sole authority over such exempt employees for 14 
employment, dismissal, and setting of compensation, up to the maximum 15 
established for the executive director and his or her principal assistants; 16 
(g) One (1) principal assistant or deputy for each person exempted under 17 
subsection (1)(e) of this section; 18 
(h) One (1) additional principal assistant or deputy as may be necessary for 19 
making and carrying out policy for each person exempted under subsection 20 
(1)(e) of this section in those instances in which the nature of the functions, 21 
size, or complexity of the unit involved are such that the secretary approves 22 
such an addition on petition of the relevant cabinet secretary or department 23 
head and such other principal assistants, deputies, or other major assistants as 24 
may be necessary for making and carrying out policy for each person 25 
exempted under subsection (1)(e) of this section in those instances in which 26 
the nature of the functions, size, or complexity of the unit involved are such 27  UNOFFICIAL COPY  	25 RS BR 387 
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that the board may approve such an addition or additions on petition of the 1 
department head approved by the secretary. Effective August 1, 2010: 2 
1. All positions approved under this paragraph prior to August 1, 2010, 3 
shall be abolished effective December 31, 2010, unless reapproved 4 
under subparagraph 2. of this paragraph; and 5 
2. A position approved under this paragraph on or after August 1, 2010, 6 
shall be approved for a period of five (5) years, after which time the 7 
position shall be abolished unless reapproved under this subparagraph 8 
for an additional five (5) year period; 9 
(i) Division directors subject to the provisions of KRS 18A.170. Division 10 
directors in the classified service as of January 1, 1980, shall remain in the 11 
classified service; 12 
(j) Physicians employed as such; 13 
(k) One (1) private secretary for each person exempted under subsection (1)(e), 14 
(g), and (h) of this section; 15 
(l) The judicial department, referees, receivers, jurors, and notaries public; 16 
(m) Officers and members of the staffs of state universities and colleges and 17 
student employees of such institutions; officers and employees of the 18 
Teachers' Retirement System; and officers, teachers, and employees of local 19 
boards of education; 20 
(n) Patients or inmates employed in state institutions; 21 
(o) Persons employed in a professional or scientific capacity to make or conduct a 22 
temporary or special inquiry, investigation, or examination on behalf of the 23 
General Assembly, or a committee thereof, or by authority of the Governor, 24 
and persons employed by state agencies for a specified, limited period to 25 
provide professional, technical, scientific, or artistic services under the 26 
provisions of KRS 45A.690 to 45A.725; 27  UNOFFICIAL COPY  	25 RS BR 387 
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(p) Interim employees; 1 
(q) Officers and members of the state militia; 2 
(r) Department of Kentucky State Police troopers; 3 
(s) University or college engineering students or other students employed part-4 
time or part-year by the state through special personnel recruitment programs; 5 
provided that while so employed such aides shall be under contract to work 6 
full-time for the state after graduation for a period of time approved by the 7 
commissioner or shall be participants in a cooperative education program 8 
approved by the commissioner; 9 
(t) Superintendents of state mental institutions, including heads of centers for 10 
individuals with an intellectual disability, and penal and correctional 11 
institutions as referred to in KRS 196.180(2); 12 
(u) Staff members of the Kentucky Historical Society, if they are hired in 13 
accordance with KRS 171.311; 14 
(v) County and Commonwealth's attorneys and their respective appointees; 15 
(w) Chief district engineers and the state highway engineer; 16 
(x) Employees of[veterinarians employed as such by] the Kentucky Horse Racing 17 
and Gaming Corporation; 18 
(y) Employees of the Kentucky Peace Corps; 19 
(z) Employees of the Council on Postsecondary Education; 20 
(aa) Executive director of the Commonwealth Office of Technology; 21 
(ab) Employees of Serve Kentucky; 22 
(ac) Persons employed in certified teaching positions at the Kentucky School for 23 
the Blind and the Kentucky School for the Deaf; 24 
(ad) Federally funded time-limited employees as defined in KRS 18A.005; and 25 
(ae) Employees of the Department of Agriculture who are employed to support the 26 
Agricultural Development Board and the Kentucky Agricultural Finance 27  UNOFFICIAL COPY  	25 RS BR 387 
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Corporation. 1 
(2) Nothing in KRS 18A.005 to 18A.200 is intended, or shall be construed, to alter or 2 
amend the provisions of KRS 150.022 and 150.061. 3 
(3) Nothing in KRS 18A.005 to 18A.200 is intended or shall be construed to affect any 4 
nonmanagement, nonpolicy-making position which must be included in the 5 
classified service as a prerequisite to the grant of federal funds to a state agency. 6 
(4) Career employees within the classified service promoted to positions exempted 7 
from classified service shall, upon termination of their employment in the exempted 8 
service, revert to a position in that class in the agency from which they were 9 
terminated if a vacancy in that class exists. If no such vacancy exists, they shall be 10 
considered for employment in any vacant position for which they were qualified 11 
pursuant to KRS 18A.130 and 18A.135. 12 
(5) Nothing in KRS 18A.005 to 18A.200 shall be construed as precluding appointing 13 
officers from filling unclassified positions in the manner in which positions in the 14 
classified service are filled except as otherwise provided in KRS 18A.005 to 15 
18A.200. 16 
(6) The positions of employees who are transferred, effective July 1, 1998, from the 17 
Cabinet for Workforce Development to the Kentucky Community and Technical 18 
College System shall be abolished and the employees' names removed from the 19 
roster of state employees. Employees that are transferred, effective July 1, 1998, to 20 
the Kentucky Community and Technical College System under KRS Chapter 164 21 
shall have the same benefits and rights as they had under KRS Chapter 18A and 22 
have under KRS 164.5805; however, they shall have no guaranteed reemployment 23 
rights in the KRS Chapter 151B or KRS Chapter 18A personnel systems. An 24 
employee who seeks reemployment in a state position under KRS Chapter 151B or 25 
KRS Chapter 18A shall have years of service in the Kentucky Community and 26 
Technical College System counted towards years of experience for calculating 27  UNOFFICIAL COPY  	25 RS BR 387 
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benefits and compensation. 1 
(7) On August 15, 2000, all certified and equivalent personnel, all unclassified 2 
personnel, and all certified and equivalent and unclassified vacant positions in the 3 
Department for Adult Education and Literacy shall be transferred from the 4 
personnel system under KRS Chapter 151B to the personnel system under KRS 5 
Chapter 18A. The positions shall be deleted from the KRS Chapter 151B personnel 6 
system. All records shall be transferred including accumulated annual leave, sick 7 
leave, compensatory time, and service credit for each affected employee. The 8 
personnel officers who administer the personnel systems under KRS Chapter 151B 9 
and KRS Chapter 18A shall exercise the necessary administrative procedures to 10 
effect the change in personnel authority. No certified or equivalent employee in the 11 
Department for Adult Education and Literacy shall suffer any penalty in the 12 
transfer. 13 
(8) On August 15, 2000, secretaries and assistants attached to policymaking positions 14 
in the Department for Technical Education and the Department for Adult Education 15 
and Literacy shall be transferred from the personnel system under KRS Chapter 16 
151B to the personnel system under KRS Chapter 18A. The positions shall be 17 
deleted from the KRS Chapter 151B system. All records shall be transferred 18 
including accumulated annual leave, sick leave, compensatory time, and service 19 
credit for each affected employee. No employee shall suffer any penalty in the 20 
transfer. 21 
(9) On May 1, 2017, all contract employees of Eastern Kentucky University who are 22 
engaged in providing instructional and support services to the Department of 23 
Criminal Justice Training shall be transferred to the personnel system under KRS 24 
Chapter 18A. All records shall be transferred, including accumulated annual leave, 25 
sick leave, compensatory time, and service credit for each affected employee. The 26 
personnel officers who administer the personnel systems for Eastern Kentucky 27  UNOFFICIAL COPY  	25 RS BR 387 
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University and under KRS Chapter 18A shall exercise the necessary administrative 1 
procedures to effect the change in personnel authority. No employee shall suffer 2 
any penalty in the transfer. 3 
(10) On July 1, 2024, all employees of the Louisville and Jefferson County Public 4 
Defender Corporation shall be transferred to the personnel system under KRS 5 
Chapter 18A. Records of each employee's job classification, compensation, dates of 6 
employment, dates of professional licensure, probationary status, accumulated leave 7 
balances by category, months of service, and any other information necessary under 8 
KRS Chapter 18A shall be transferred. The personnel officers who administer the 9 
personnel systems for the Louisville and Jefferson County Public Defender 10 
Corporation and under KRS Chapter 18A shall exercise the necessary 11 
administrative procedures to effect the change in the personnel authority. No 12 
employee shall suffer any penalty in the transfer. 13 
Section 33.   KRS 138.510 is amended to read as follows: 14 
(1) (a) Before August 1, 2022, except as provided in paragraph (e) of this subsection 15 
and subsection (3) of this section, an excise tax is imposed on all tracks 16 
conducting pari-mutuel wagering on live racing under the jurisdiction of the 17 
corporation as follows: 18 
1. For each track with a daily average live handle of one million two 19 
hundred thousand dollars ($1,200,000) or above, the tax shall be in the 20 
amount of three and one-half percent (3.5%) of all money wagered on 21 
live races at the track during the fiscal year; and 22 
2. For each track with a daily average live handle under one million two 23 
hundred thousand dollars ($1,200,000), the tax shall be one and one-half 24 
percent (1.5%) of all money wagered on live races at the track during 25 
the fiscal year. 26 
(b) Beginning August 1, 2022, the excise tax imposed on all tracks conducting 27  UNOFFICIAL COPY  	25 RS BR 387 
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pari-mutuel wagering on live racing under jurisdiction of the corporation shall 1 
be one and one-half percent (1.5%) of all money wagered on live races at the 2 
track during the fiscal year. 3 
(c) Beginning on April 1, 2014, an excise tax is imposed on all tracks conducting 4 
pari-mutuel wagering on historical horse races under the jurisdiction of the 5 
corporation at a rate of one and one-half percent (1.5%) of all money wagered 6 
on historical horse races at the track during the fiscal year. 7 
(d) Money shall be deducted from the tax paid under paragraphs (a), (b), and (c) 8 
of this subsection and deposited as follows: 9 
1. a. Before August 1, 2022, an amount equal to three-quarters of one 10 
percent (0.75%) of all money wagered on live races and historical 11 
horse races at the track for Thoroughbred racing shall be deposited 12 
in the Thoroughbred development fund established in KRS 13 
230.400; and 14 
b. Beginning August 1, 2022, an amount equal to three-quarters of 15 
one percent (0.75%) of all money wagered on live races and 16 
historical horse races at the track for Thoroughbred racing shall be 17 
deposited in the Thoroughbred development fund established in 18 
KRS 230.400 until forty-five million dollars ($45,000,000) has 19 
been deposited during a fiscal year, at which point the amount 20 
deposited in the fund shall decrease to four-tenths of one percent 21 
(0.4%) of all money wagered on live and historical horse races at 22 
the track for Thoroughbred racing for the remainder of the fiscal 23 
year; 24 
2. a. Before August 1, 2022, an amount equal to one percent (1%) of all 25 
money wagered on live races and historical horse races at the track 26 
for harness racing shall be deposited in the Kentucky standardbred 27  UNOFFICIAL COPY  	25 RS BR 387 
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development fund established in KRS 230.770. Beginning August 1 
1, 2022, an amount equal to one percent (1%) of all money 2 
wagered on live races at the track for harness racing shall be 3 
deposited in the Kentucky standardbred development fund until a 4 
total of twenty million dollars ($20,000,000) has been deposited 5 
during a fiscal year from this subparagraph, at which point the 6 
amount deposited shall decrease to four-tenths of one percent 7 
(0.4%) of all money wagered for the remainder of the fiscal year; 8 
and 9 
b. Beginning August 1, 2022, an amount equal to one percent (1%) 10 
of all money wagered on historical horse races at the track for 11 
harness racing shall be distributed in the exact amounts based 12 
upon contracts between the parties that have been filed with the 13 
corporation, but at least one-half (1/2) of the funds shall be 14 
deposited into the Kentucky standardbred development fund 15 
established in KRS 230.770 until a total of twenty million dollars 16 
($20,000,000) has been deposited into the Kentucky standardbred 17 
development fund during a fiscal year from this subparagraph, at 18 
which point the amount deposited in this subdivision shall 19 
decrease to four-tenths of one percent (0.4%) of all money 20 
wagered for the remainder of the fiscal year. The corporation shall 21 
provide the department all information necessary from the 22 
contracts in order for the funds in this subparagraph to be 23 
distributed; 24 
3. a. An amount equal to one percent (1%) of all money wagered on 25 
live races and historical horse races at the track for[ quarter horse,] 26 
paint horse, Appaloosa, and Arabian horse racing shall be 27  UNOFFICIAL COPY  	25 RS BR 387 
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deposited in the Kentucky[ quarter horse,] paint horse, Appaloosa, 1 
and Arabian development fund established by KRS 230.445; and 2 
b. An amount equal to one percent (1%) of all money wagered on 3 
live races and historical horse races at the track for quarter 4 
horse racing shall be deposited in the Kentucky quarter horse 5 
development fund established by Section 13 of this Act; 6 
4. An amount equal to two-tenths of one percent (0.2%) of all money 7 
wagered on live races and historical horse races at the track shall be paid 8 
out in equal amounts as follows: 9 
a. To the equine industry program trust and revolving fund 10 
established by KRS 230.550 to support the Equine Industry 11 
Program at the University of Louisville, except that the amount 12 
deposited from money wagered on historical horse races in any 13 
fiscal year shall not exceed eight hundred fifty thousand dollars 14 
($850,000); 15 
b. To the University of Kentucky for equine industry programs at the 16 
university, except that the amount paid from money wagered on 17 
historical horse races in any fiscal year shall not exceed four 18 
hundred thousand dollars ($400,000);  19 
c. To the Bluegrass Community and Technical College for the 20 
provision of equine industry programs by the system, except that 21 
the amount paid from money wagered on historical horse races in 22 
any fiscal year shall not exceed two hundred fifty thousand dollars 23 
($250,000);  24 
d. Amounts remaining from money wagered on historical horse races 25 
in a fiscal year after payments are made in accordance with 26 
subdivisions a., b., and c. of this subparagraph shall be distributed 27  UNOFFICIAL COPY  	25 RS BR 387 
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in equal amounts to: 1 
i. The Kentucky Horse Racing and Gaming Corporation for the 2 
benefit of Thoroughbred, standardbred, and American 3 
quarter horse aftercare facilities in Kentucky, in an amount 4 
not to exceed two hundred fifty thousand dollars ($250,000). 5 
The Kentucky Horse Racing and Gaming Corporation shall 6 
serve as the administrative agent for these funds, and shall 7 
distribute them annually to organizations engaged in the 8 
accreditation and monitoring of aftercare facilities. Any 9 
funds distributed under this subpart by the Kentucky Horse 10 
Racing and Gaming Corporation shall be awarded to 11 
aftercare facilities based in Kentucky only after the facilities 12 
have achieved and maintained levels of service and operation 13 
that resulted in national accreditation; and 14 
ii. The Kentucky equine management internship program for 15 
equine management training, in an amount not to exceed two 16 
hundred fifty thousand dollars ($250,000); and 17 
e. Any amounts remaining from money wagered on historical horse 18 
races in a fiscal year after payments are made in accordance with 19 
subdivisions a., b., c., and d. of this subparagraph shall be paid to 20 
the general fund; 21 
5. a. An amount equal to one-tenth of one percent (0.1%) of all money 22 
wagered on live races and historical horse races at the track shall 23 
be deposited in a trust and revolving fund to be used for the 24 
construction, expansion, or renovation of facilities or the purchase 25 
of equipment for equine programs at state universities and the 26 
Bluegrass Community and Technical College, except that the 27  UNOFFICIAL COPY  	25 RS BR 387 
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amount deposited from money wagered on historical horse races in 1 
any fiscal year shall not exceed three hundred twenty thousand 2 
dollars ($320,000). 3 
b. These funds shall not be used for salaries or for operating funds 4 
for teaching, research, or administration. Funds allocated under 5 
this subparagraph shall not replace other funds for capital purposes 6 
or operation of equine programs at state universities and the 7 
Bluegrass Community and Technical College. 8 
c. The Kentucky Council on Postsecondary Education shall serve as 9 
the administrative agent for these funds, and shall establish an 10 
advisory committee of interested parties, including all universities 11 
and the Bluegrass Community and Technical College with 12 
established 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 corporation 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). 24 
(e) The excise tax imposed by paragraphs (a) and (b) of this subsection shall not 25 
apply to pari-mutuel wagering on live harness racing at a county fair. 26 
(2) (a) Except as provided in paragraph (c) of this subsection, an excise tax is 27  UNOFFICIAL COPY  	25 RS BR 387 
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imposed on: 1 
1. All tracks conducting telephone account wagering; 2 
2. All tracks participating as receiving tracks in intertrack wagering under 3 
the jurisdiction of the corporation; and 4 
3. All tracks participating as receiving tracks displaying simulcasts and 5 
conducting interstate wagering thereon. 6 
(b) 1. Before August 1, 2022, the tax shall be three percent (3%) of all money 7 
wagered on races as provided in paragraph (a) of this subsection during 8 
the fiscal year. 9 
2. Beginning August 1, 2022, the tax shall be one and one-half percent 10 
(1.5%) of all money wagered on races as provided in paragraph (a) of 11 
this subsection during the fiscal year. 12 
(c) A noncontiguous track facility approved by the corporation on or after 13 
January 1, 1999, shall be exempt from the tax imposed under this subsection, 14 
if the facility is established and operated by a licensed track which has a total 15 
annual handle on live racing of two hundred fifty thousand dollars ($250,000) 16 
or less. The amount of money exempted under this paragraph shall be retained 17 
by the noncontiguous track facility, KRS 230.3771 and 230.378 18 
notwithstanding. 19 
(d) Money shall be deducted from the tax paid under paragraphs (a) and (b) of 20 
this subsection as follows: 21 
1. An amount equal to one percent (1%) of the amount wagered shall be 22 
deposited as follows: 23 
a. In the Thoroughbred development fund established in KRS 24 
230.400 if the host track is conducting a Thoroughbred race 25 
meeting or the interstate wagering is conducted on a Thoroughbred 26 
race meeting; 27  UNOFFICIAL COPY  	25 RS BR 387 
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b. In the Kentucky standardbred development fund established in 1 
KRS 230.770, if the host track is conducting a harness race 2 
meeting or the interstate wagering is conducted on a harness race 3 
meeting;[ or] 4 
c. In the Kentucky[ quarter horse,] paint horse, Appaloosa, and 5 
Arabian development fund established by KRS 230.445, if the host 6 
track is conducting a[ quarter horse,] paint horse, Appaloosa, or 7 
Arabian horse race meeting or the interstate wagering is conducted 8 
on a[ quarter horse,] paint horse, Appaloosa, or Arabian horse race 9 
meeting; or 10 
d. In the Kentucky quarter horse development fund established by 11 
Section 13 of this Act, if the host track is conducting a quarter 12 
horse race meeting or the interstate wagering is conducted on a 13 
quarter horse race meeting; 14 
2. An amount equal to twenty-five thousandths of one percent (0.025%) of 15 
the amount wagered shall be allocated to the equine industry program 16 
trust and revolving fund established by KRS 230.550 to be used to 17 
support the Equine Industry Program at the University of Louisville; 18 
3. An amount equal to one-twentieth of one percent (0.05%) of the amount 19 
wagered shall be deposited in a trust and revolving fund to be used for 20 
the construction, expansion, or renovation of facilities or the purchase of 21 
equipment for equine programs at state universities, as detailed in 22 
subsection (1)(d)5. of this section; and 23 
4. An amount equal to one-twentieth of one percent (0.05%) of the amount 24 
wagered shall be distributed to the corporation to support equine drug 25 
testing as provided in KRS 230.265(3). 26 
(3) If a host track in this state is the location for the conduct of a two (2) day 27  UNOFFICIAL COPY  	25 RS BR 387 
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international horse racing event that distributes in excess of a total of twenty million 1 
dollars ($20,000,000) in purses and awards: 2 
(a) The excise tax imposed by subsection (1)(a) and (b) of this section shall not 3 
apply to money wagered at the track on live races conducted at the track 4 
during the two (2) day international horse racing event; and 5 
(b) Amounts wagered at the track on live races conducted at the track during the 6 
two (2) day international horse racing event shall not be included in 7 
calculating the daily average live handle for purposes of subsection (1) of this 8 
section. 9 
(4) If a host track in this state is the location for the conduct of an international harness 10 
racing event spanning multiple days that distributes at least five million dollars 11 
($5,000,000) in purses and awards, the Tourism, Arts and Heritage Cabinet shall be 12 
granted a race title sponsorship and promotional package at the international 13 
harness racing event with all usual and customary benefits assigned to promote 14 
Kentucky tourism. The Tourism, Arts and Heritage Cabinet shall not be charged 15 
any fees for the promotional package. 16 
(5) The taxes imposed by this section shall be paid, collected, and administered as 17 
provided in KRS 138.530. 18 
Section 34.   KRS 68.182 is amended to read as follows: 19 
(1) Occupational license fees levied under KRS 67.083, 68.180, and 68.197 by the 20 
fiscal court of a county, consolidated local government, urban-county government, 21 
charter county government, or unified local government may apply to racetrack 22 
extensions. 23 
(2) As used in this section: 24 
(a) "Historical horse race" has the same meaning as in KRS 138.511; and 25 
(b) 1. "Racetrack extension" means any facility: 26 
a. Owned, leased, or purchased by an association licensed by the 27  UNOFFICIAL COPY  	25 RS BR 387 
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Kentucky Horse Racing and Gaming Corporation under KRS 1 
230.300; 2 
b. That meets the definition of "track" under KRS 3 
230.210(37)[(35)](c); and 4 
c. Where pari-mutuel wagering on historical horse races is conducted 5 
on terminals approved by the Kentucky Horse Racing and Gaming 6 
Corporation. 7 
2. "Racetrack extension" does not include a facility or real property used 8 
for training horses or at which live horse races are run for stakes, purses, 9 
or prizes under the jurisdiction of the Kentucky Horse Racing and 10 
Gaming Corporation. 11 
Section 35.   KRS 91.202 is amended to read as follows: 12 
(1) Occupational license fees levied under KRS 91.200 by the legislative body of a city 13 
of the first class may apply to racetrack extensions. 14 
(2) As used in this section: 15 
(a) "Historical horse race" has the same meaning as in KRS 138.511; and 16 
(b) 1. "Racetrack extension" means any facility: 17 
a. Owned, leased, or purchased by an association licensed by the 18 
Kentucky Horse Racing and Gaming Corporation under KRS 19 
230.300; 20 
b. That meets the definition of "track" under KRS 21 
230.210(37)[(35)](c); and 22 
c. Where pari-mutuel wagering on historical horse races is conducted 23 
on terminals approved by the Kentucky Horse Racing and Gaming 24 
Corporation. 25 
2. "Racetrack extension" does not include a facility or real property used 26 
for training horses or at which live horse races are run for stakes, purses, 27  UNOFFICIAL COPY  	25 RS BR 387 
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or prizes under the jurisdiction of the Kentucky Horse Racing and 1 
Gaming Corporation. 2 
Section 36.   KRS 92.282 is amended to read as follows: 3 
(1) Occupational license fees levied under KRS 92.281 by the legislative body of a city 4 
may apply to racetrack extensions. 5 
(2) As used in this section: 6 
(a) "Historical horse race" has the same meaning as in KRS 138.511; and 7 
(b) 1. "Racetrack extension" means any facility: 8 
a. Owned, leased, or purchased by an association licensed by the 9 
Kentucky Horse Racing and Gaming Corporation under KRS 10 
230.300; 11 
b. That meets the definition of "track" under KRS 12 
230.210(37)[(35)](c); and 13 
c. Where pari-mutuel wagering on historical horse races is conducted 14 
on terminals approved by the Kentucky Horse Racing and Gaming 15 
Corporation. 16 
2. "Racetrack extension" does not include a facility or real property used 17 
for training horses or at which live horse races are run for stakes, purses, 18 
or prizes under the jurisdiction of the Kentucky Horse Racing and 19 
Gaming Corporation. 20 
Section 37.   KRS 230.218 is amended to read as follows: 21 
(1) There is established, under the jurisdiction of the Kentucky Horse Racing and 22 
Gaming Corporation, the backside improvement fund. This revolving fund shall 23 
consist of money allocated to the fund under the provisions of KRS 230.3615, 24 
together with any other money which may be contributed to or allocated to the fund 25 
from all other sources. Money to the credit of the backside improvement fund at the 26 
end of each fiscal year shall not lapse but shall be carried forward in the fund to the 27  UNOFFICIAL COPY  	25 RS BR 387 
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succeeding fiscal year. The Kentucky Horse Racing and Gaming Corporation may 1 
invest any and all funds received by the fund and interest earned by the investment 2 
of said funds in types of investments appropriate to the investment needs of the 3 
fund after having considered the financial return on authorized investment 4 
alternatives, the financial safety of investment alternatives and the impact of any 5 
authorized investments on the state's economy. The corporation shall review the 6 
status of the fund investments quarterly and report its findings to the Finance and 7 
Administration Cabinet and the Legislative Research Commission. 8 
(2) The purpose of the fund shall be to improve the backside of Thoroughbred racing 9 
associations averaging one million two hundred thousand dollars ($1,200,000) or 10 
less pari-mutuel handle per racing day on live racing. The Kentucky Horse Racing 11 
and Gaming Corporation shall use the backside improvement fund to promote, 12 
enhance, and improve the conditions of the backside of eligible racing associations. 13 
Conditions considered shall include but not be limited to the living and working 14 
quarters of backside employees. 15 
(3) The Kentucky Horse Racing and Gaming Corporation may[shall] promulgate 16 
administrative regulations in accordance with KRS Chapter 13A[ as may be 17 
necessary] to carry out the provisions and purposes of this section. 18 
Section 38.   KRS 230.260 is amended to read as follows: 19 
The corporation shall have all powers necessary and proper to carry out and effectuate the 20 
purposes and provisions of this chapter on and after July 1, 2024, and the purposes and 21 
provisions of KRS Chapter 238 on and after July 1, 2025, including but not limited to the 22 
following: 23 
(1) The corporation is vested with jurisdiction and supervision over all live horse 24 
racing, pari-mutuel wagering, sports wagering, breed integrity and development, 25 
and on and after July 1, 2025, charitable gaming, except for lottery games 26 
authorized under KRS Chapter 154A, in this Commonwealth and over all 27  UNOFFICIAL COPY  	25 RS BR 387 
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associations and all persons on association grounds and may eject or exclude 1 
therefrom or any part thereof, any person, licensed or unlicensed, whose conduct or 2 
reputation is such that the person's presence on association grounds may, in the 3 
opinion of the corporation, negatively reflect on the honesty and integrity of horse 4 
racing, or on sporting events upon which sports wagers may be placed, or interfere 5 
with the orderly conduct of horse racing or racing at horse race meetings, but no 6 
persons shall be excluded or ejected from association grounds solely on the ground 7 
of race, color, creed, national origin, ancestry, or sex; 8 
(2) The corporation is vested with jurisdiction over any person or entity that offers 9 
advance deposit account wagering to Kentucky residents. Any such person or entity 10 
under the jurisdiction of the corporation shall be licensed by the corporation, and 11 
the corporation may impose a license fee not to exceed ten thousand dollars 12 
($10,000) annually. The corporation may[shall], by administrative regulation 13 
promulgated in accordance with KRS Chapter 13A, establish conditions and 14 
procedures for the licensing of advance deposit account wagering providers to 15 
include but not be limited to: 16 
(a) A fee schedule for applications for licensure; and 17 
(b) Reporting requirements to include quarterly reporting on: 18 
1. The amount wagered on Kentucky races; and 19 
2. The total amount wagered by Kentuckians; 20 
(3) The corporation is vested with jurisdiction over any totalizator[totalisator] company 21 
that provides totalizator[totalisator] services to a racing association located in the 22 
Commonwealth. A totalizator[totalisator] company under the jurisdiction of the 23 
corporation shall be licensed by the corporation, regardless of whether a 24 
totalizator[totalisator] company is located in the Commonwealth or operates from a 25 
location or locations outside of the Commonwealth, and the corporation may 26 
impose a license fee on a totalizator[totalisator] company. The corporation 27  UNOFFICIAL COPY  	25 RS BR 387 
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may[shall], by administrative regulation promulgated in accordance with KRS 1 
Chapter 13A, establish conditions and procedures for the licensing of 2 
totalizator[totalisator] companies, and a fee schedule for applications for licensure; 3 
(4) The corporation is vested with jurisdiction over any manufacturer, wholesaler, 4 
distributor, or vendor of any equine drug, medication, therapeutic substance, or 5 
metabolic derivative which is purchased by or delivered to a licensee or other 6 
person participating in Kentucky horse racing by means of the internet, mail 7 
delivery, in-person delivery, or other means; 8 
(5) The corporation is vested with jurisdiction over any horse training center or facility 9 
in the Commonwealth that records official timed workouts for publication; 10 
(6) The corporation may require an applicant for a license under subsection (2) or (3) of 11 
this section to submit to a background check of the applicant, or of any individual 12 
or organization associated with the applicant. An applicant shall be required to 13 
reimburse the corporation for the cost of any background check conducted; 14 
(7) The corporation, its representatives and employees, may visit, investigate, and have 15 
free access to the office, track, facilities, or other places of business of any licensee, 16 
or any person owning a horse or performing services regulated by this chapter on a 17 
horse registered to participate in a breeders incentive fund under the jurisdiction of 18 
the corporation; 19 
(8) The corporation may[shall have full authority to] prescribe necessary and 20 
reasonable administrative regulations and conditions under which horse racing at a 21 
horse race meeting shall be conducted in this state and to fix and regulate the 22 
minimum amount of purses, stakes, or awards to be offered for the conduct of any 23 
horse race meeting; 24 
(9) Applications for licenses may[shall] be made in the form and manner and contain 25 
information as required by the corporation through the promulgation of 26 
administrative regulations. Fees for all licenses issued under KRS 230.310 shall be 27  UNOFFICIAL COPY  	25 RS BR 387 
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prescribed by and paid to the corporation; 1 
(10) The corporation may[shall] establish by administrative regulation minimum fees for 2 
jockeys to be effective in the absence of a contract between an employing owner or 3 
trainer and a jockey. The minimum fees shall be no less than those of July 1, 1985; 4 
(11) The corporation may refuse to issue or renew a license, revoke or suspend a license, 5 
impose probationary conditions on a license, issue a written reprimand or 6 
admonishment, impose fines or penalties, deny purse money, require the forfeiture 7 
of purse money, or any combination thereof with regard to a licensee or other 8 
person participating in Kentucky horse racing for violation of any federal or state 9 
statute, regulation, or steward's or corporation's directive, ruling, or order to 10 
preserve the integrity of Kentucky horse racing or to protect the racing public. The 11 
corporation may[shall], by administrative regulation, establish the criteria for taking 12 
the actions described in this subsection; 13 
(12) The corporation may issue subpoenas for the attendance of witnesses before it and 14 
for the production of documents, records, papers, books, supplies, devices, 15 
equipment, and all other instrumentalities related to live horse racing, pari-mutuel 16 
wagering, sports wagering, breed integrity and development, and on and after July 17 
1, 2025, charitable gaming, within the Commonwealth. The corporation may 18 
administer oaths to witnesses and require witnesses to testify under oath whenever, 19 
in the judgment of the corporation, it is necessary to do so for the effectual 20 
discharge of its duties; 21 
(13) The corporation shall have authority to compel any racing association licensed 22 
under this chapter to file with the corporation at the end of its fiscal year, a balance 23 
sheet, showing assets and liabilities, and an earnings statement, together with a list 24 
of its stockholders or other persons holding a beneficial interest in the association; 25 
(14) The corporation may[shall] promulgate administrative regulations establishing 26 
safety standards for jockeys, which shall include the use of rib protection 27  UNOFFICIAL COPY  	25 RS BR 387 
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equipment. Rib protection equipment shall not be included in a jockey's weight; 1 
(15) (a) The corporation may[shall] promulgate administrative regulations establishing 2 
a self-exclusion list for individuals who self-identify as being problem or 3 
compulsive gamblers. 4 
(b) Self-exclusion information collected by each racing association shall be 5 
forwarded to the corporation, and the information from the racing associations 6 
shall be compiled into a comprehensive list that shall be provided to all racing 7 
associations. 8 
(c) Pursuant to KRS 61.878(1)(a), information collected under this subsection 9 
shall be excluded from the application of KRS 61.870 to 61.884; 10 
(16) (a) The corporation may[shall] promulgate administrative regulations to establish 11 
standards for the conduct of sports wagering, including standards for 12 
receiving and paying out wagers, offering sports wagering through a website 13 
or mobile application, maintaining and auditing books and financial records, 14 
securely maintaining records of bets and wagers, integrity requirements for 15 
sports wagering and related data, suitability requirements for providers of 16 
associated equipment, geofence standards for wager placement, designated 17 
areas for sports wagering, surveillance and monitoring systems, and other 18 
reasonable technical criteria related to conducting sports wagering. 19 
(b) The corporation may[shall] promulgate administrative regulations related to 20 
age requirements for placing sports wagers, availability of information related 21 
to sports wagers, and licensing requirements, including temporary 22 
authorizations, for service providers, vendors, and suppliers; and 23 
(17) (a) On and after July 1, 2025, the corporation is vested with jurisdiction and 24 
supervision over all charitable gaming and may[shall] promulgate 25 
administrative regulations to establish standards for the conduct of charitable 26 
gaming consistent with the guidelines established in this chapter and KRS 27  UNOFFICIAL COPY  	25 RS BR 387 
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Chapter 238. The corporation may eject or exclude therefrom or any part 1 
thereof, any person, licensed or unlicensed, whose conduct or reputation is 2 
such that the person's presence at a charitable gaming facility may, in the 3 
opinion of the corporation, negatively reflect on the honesty and integrity of 4 
charitable gaming, or interfere with the orderly conduct of charitable gaming 5 
at a charitable gaming facility, but no persons shall be excluded or ejected 6 
from a charitable gaming facility solely on the ground of race, color, creed, 7 
national origin, ancestry, or sex. 8 
(b) The administrative regulations of the Kentucky Horse Racing Commission 9 
that are in effect on July 1, 2024, shall remain in effect as the initial 10 
administrative regulations of the corporation until the corporation amends or 11 
repeals the administrative regulations pursuant to KRS Chapter 13A, except 12 
as provided by KRS 13A.3102, 13A.3104, and 13A.330. 13 
(c) The administrative regulations of the Department of Charitable Gaming that 14 
are in effect on July 1, 2025, shall remain in effect as the initial administrative 15 
regulations of the corporation until the corporation amends or repeals the 16 
administrative regulations pursuant to KRS Chapter 13A, except as provided 17 
by KRS 13A.3102, 13A.3104, and 13A.330. 18 
Section 39.   KRS 230.300 is amended to read as follows: 19 
(1) Any person desiring to conduct horse racing at a horse race meeting within the 20 
Commonwealth of Kentucky or to engage in simulcasting and intertrack wagering 21 
as a receiving track during any calendar year shall first apply to the corporation for 22 
a license to do so. The application shall be filed at the corporation's general office 23 
on or before October 1 of the preceding year with respect to applications to conduct 24 
live horse race meetings, and with respect to intertrack wagering dates, and on 25 
forms prescribed by the corporation. The application shall include the following 26 
information: 27  UNOFFICIAL COPY  	25 RS BR 387 
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(a) The full name and address of the person making application; 1 
(b) The location of the place, track, or enclosure where the applicant proposes to 2 
conduct horse racing meetings; 3 
(c) The dates on which the applicant intends to conduct horse racing, which shall 4 
be successive days unless authorized by the corporation; 5 
(d) The proposed hours of each racing day and the number of races to be 6 
conducted; 7 
(e) The names and addresses of all principals associated with the applicant or 8 
licensee; 9 
(f) The type of organizational structure under which the applicant operates, i.e., 10 
partnership, trust, association, limited liability company, or corporation, and 11 
the address of the principal place of business of the organization; 12 
(g) Any criminal activities in any jurisdiction for which any individual listed 13 
under paragraphs (a) and (e) has been arrested or indicted and the disposition 14 
of the charges, and any current or on-going criminal investigation of which 15 
any of these individuals is the subject; and 16 
(h) Any other information that the corporation by administrative regulation deems 17 
relevant and necessary to determine the fitness of the applicant to receive a 18 
license, including fingerprints of any individual listed under paragraphs (a) 19 
and (e), if necessary for proper identification of the individual or a 20 
determination of suitability to be associated with a licensed racing association. 21 
(2) An application for association license shall be accompanied by the following 22 
documents: 23 
(a) For a new license applicant, a financial statement prepared and attested to by a 24 
certified public accountant in accordance with generally accepted accounting 25 
principles, showing the following: 26 
1. The net worth of the applicant; 27  UNOFFICIAL COPY  	25 RS BR 387 
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2. Any debts or financial obligations owed by the applicant and the persons 1 
to whom owed; and 2 
3. The proposed or current financing structure for the operation and the 3 
sources of financing. 4 
(b) For a license renewal applicant, an audited financial statement for the prior 5 
year; 6 
(c) A copy of the applicant's federal and state tax return for the previous year. 7 
Tax returns submitted in accordance with this provision shall be treated as 8 
confidential; 9 
(d) A statement from the Department of Revenue that there are no delinquent 10 
taxes or other financial obligations owed by the applicant to the state or any of 11 
its agencies or departments; 12 
(e) A statement from the county treasurer of the county in which the applicant 13 
conducts or proposes to conduct horse racing meetings that there are no 14 
delinquent real or personal property taxes owed by the applicant. 15 
(3) The completed application shall be signed by the applicant or the chief executive 16 
officer if the applicant is an organization, sworn under oath that the information is 17 
true, accurate, and complete, and the application shall be notarized. 18 
(4) If there is any change in any information submitted in the application process, the 19 
applicant or licensee shall notify the corporation within thirty (30) days of the 20 
change. 21 
(5) The corporation shall as soon as practicable, but in no event later than November 1 22 
in any calendar year, award dates for racing in the Commonwealth during the next 23 
year. In awarding dates, the corporation shall consider and seek to preserve each 24 
track's usual and customary dates, as these dates are requested. If dates other than 25 
the usual and customary dates are requested, the applicant shall include a statement 26 
in its application setting forth the reasons the requested dates are sought. Dates for 27  UNOFFICIAL COPY  	25 RS BR 387 
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the conduct of intertrack wagering shall be awarded as provided in KRS 230.377. In 1 
the event scheduled racing is canceled by reason of flood, fire, inclement weather, 2 
or other natural disaster or emergency, the corporation may award after November 3 
1 additional racing dates to make up for those dates canceled. 4 
(6) The corporation may issue a license to conduct a horse race meeting to any 5 
association making the aforesaid application if the applicant meets the requirements 6 
established in KRS 138.530 and other applicable provisions of this chapter, and if 7 
the corporation finds that the proposed conduct of racing by the association would 8 
be in the best interest of the public health, safety, and welfare of the immediate 9 
community as well as to the Commonwealth. 10 
(7) As a condition precedent to the issuance of a license, the corporation may require a 11 
surety bond or other surety conditioned upon the payment of all taxes due the 12 
Commonwealth, together with the payment of operating expenses including purses 13 
and awards to owners of horses participating in races. 14 
(8) The corporation may impose a fee and may[shall] establish, by administrative 15 
regulation promulgated in accordance with KRS Chapter 13A, a fee schedule for 16 
association license applications. 17 
(9) The corporation may require an applicant for an association license to submit to a 18 
background check of the applicant, or of any principal, individual, or organization 19 
associated with the applicant. The corporation shall not require a background check 20 
for any individual who is a principal as defined in KRS 230.210 but owns stock or 21 
financial interest in the applicant of less than ten percent (10%). An applicant shall 22 
be required to reimburse the corporation for the cost of any background check 23 
conducted. 24 
(10) Every license issued under this chapter shall specify among other things the name 25 
of the person to whom issued, the address and location of the track where the horse 26 
race meeting to which it relates is to be held or conducted, and the days and hours 27  UNOFFICIAL COPY  	25 RS BR 387 
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of the day when the meeting will be permitted; provided, however, that no track that 1 
is granted overlapping dates for the conduct of a live race meeting with another 2 
horse racing track within a fifty (50) mile radius shall be permitted to have a post 3 
time after 5:30 p.m., prevailing time for overlapping days between July 1 and 4 
September 15, unless agreed to in writing by the tracks affected. 5 
(11) A license issued under this section is neither transferable nor assignable and shall 6 
not permit the conduct of a horse race meeting at any track not specified therein. 7 
However, if the track specified becomes unsuitable for racing because of flood, fire, 8 
or other catastrophe, the corporation may, upon application, authorize the meeting, 9 
or any remaining portion thereof, to be conducted at any other suitable track 10 
available for that purpose, provided that the owner of the track willingly consents to 11 
the use thereof. 12 
(12) Horse racing dates may be awarded and licenses issued authorizing horse racing on 13 
any day of the year. Horse racing shall be held or conducted only between sunrise 14 
and midnight. 15 
(13) The corporation may at any time require the removal of any official or employee of 16 
any association in those instances where it has reason to believe that the official or 17 
employee has been guilty of any dishonest practice in connection with horse racing 18 
or has failed to comply with any condition of his or her license or has violated any 19 
law or any administrative regulation of the corporation. 20 
(14) Every horse race not licensed under this section is hereby declared to be a public 21 
nuisance and the corporation may obtain an injunction against the same in the 22 
Circuit Court of the county where the unlicensed race is proposed to take place. 23 
Section 40. KRS 230.310 (Effective July 1, 2025) is amended to read as 24 
follows: 25 
(1) (a) Every person not required to be licensed under KRS 230.300 who desires to 26 
participate in horse racing in the Commonwealth as a horse owner, trainer, 27  UNOFFICIAL COPY  	25 RS BR 387 
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jockey, apprentice jockey, agent, stable employee, racing official, association 1 
employee, or employee of a person or concern contracting with the 2 
association to provide a service or commodity and which requires their 3 
presence on association grounds during a race meeting, or veterinarian, 4 
farrier, horse dentist, or supplier of food, tack, medication, or horse feed, or in 5 
any other capacity as the corporation may[shall] establish by administrative 6 
regulation, shall first apply to the corporation for a license to participate in the 7 
activity on association grounds during a race meeting. No person required to 8 
be licensed by this section may participate in any activity required to be 9 
licensed on association grounds during a race meeting without a valid license 10 
therefor.  11 
(b) An applicant for a license shall submit to the corporation fingerprints as may 12 
be required and other information necessary and reasonable for processing a 13 
license application. The corporation is authorized to exchange fingerprint data 14 
with the Department of Kentucky State Police and the Federal Bureau of 15 
Investigation in order to conduct a criminal history background check of an 16 
applicant.  17 
(c) The corporation may issue a license if it finds that the financial responsibility, 18 
age, experience, reputation, competence, and general fitness of the applicant 19 
to perform the activity permitted by a license are consistent with the best 20 
interest of racing and the maintenance of the honesty, integrity, and high 21 
quality thereof. 22 
(2) (a) Every person who desires to participate in sports wagering in the 23 
Commonwealth working in a licensed facility for sports wagering, directly 24 
supervising individuals who have the capability of affecting the outcome of 25 
sports wagering, or having the capability to affect the outcome of sports 26 
wagering through deployment of code to production for any critical 27  UNOFFICIAL COPY  	25 RS BR 387 
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component of a sports wagering system or the capability to deploy code to 1 
production shall first apply to the corporation for a valid occupational license 2 
to participate in that activity.  3 
(b) An applicant for an occupational license shall submit to the corporation 4 
fingerprints as may be required and other information necessary and 5 
reasonable for processing a license application. The corporation is authorized 6 
to exchange fingerprint data with the Department of Kentucky State Police 7 
and the Federal Bureau of Investigation in order to conduct a criminal history 8 
background check of an applicant.  9 
(c) The corporation may issue a license if it finds that the financial responsibility, 10 
age, experience, reputation, competence, and general fitness of the applicant 11 
to perform the activity permitted by a license are consistent with the best 12 
interest of sports wagering in the Commonwealth, and the maintenance of the 13 
honesty, integrity, and high quality thereof. 14 
(3) Every person who desires to be licensed to participate in charitable gaming shall 15 
first meet the standards of this chapter and the standards established in KRS 16 
Chapter 238. 17 
(4) A license may be issued for the calendar year for which an applicant applies or, if 18 
authorized by administrative regulation of the corporation, a license may be issued 19 
that expires on the last day of the birth month of the licensee. A license may be 20 
renewed by the corporation. The license shall be valid at all horse race meetings in 21 
the Commonwealth during the period for which it is issued unless suspended or 22 
revoked under the administrative regulations promulgated by the corporation under 23 
this chapter. The occupational license to participate in sports wagering may be 24 
suspended or revoked pursuant to administrative regulations promulgated by the 25 
corporation under this chapter. With respect to horse owners and trainers, the 26 
corporation may promulgate administrative regulations to facilitate and promote 27  UNOFFICIAL COPY  	25 RS BR 387 
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uniform, reciprocal licensing with other states. 1 
Section 41.   KRS 230.320 is amended to read as follows: 2 
(1) Every license granted under this chapter is subject to denial, revocation, or 3 
suspension, and every licensee or other person participating in Kentucky horse 4 
racing may be assessed an administrative fine and required to forfeit or return a 5 
purse, by the corporation in any case where it has reason to believe that any 6 
provision of this chapter, administrative regulation, or condition of the corporation 7 
affecting it has not been complied with or has been broken or violated. The 8 
corporation may deny, revoke, or suspend a license for failure by the licensee or 9 
other person participating in Kentucky horse racing to pay an administrative fine 10 
imposed upon the licensee by the stewards or the corporation. The corporation, in 11 
the interest of honesty and integrity of horse racing, may promulgate administrative 12 
regulations under which any license may be denied, suspended, or revoked, and 13 
under which any licensee or other person participating in Kentucky horse racing 14 
may be assessed an administrative fine or required to forfeit or return a purse. 15 
(2) (a) Following a hearing by the stewards, a person who has been disciplined by a 16 
ruling of the stewards may apply to the corporation for a stay of the ruling, 17 
pending action on an appeal by the corporation. 18 
(b) An application for a stay shall be received by the president or his or her 19 
designee within ten (10) calendar days of the issuance of the stewards' ruling. 20 
(c) An application for a stay shall be in writing and include the following: 21 
1. The name, address, telephone number, and signature of the person 22 
requesting the stay; 23 
2. A statement of the justification for the stay; and 24 
3. The period of time for which the stay is requested. 25 
(d) On a finding of good cause, the president or his or her designee may grant the 26 
stay. The president or his or her designee shall issue a written decision 27  UNOFFICIAL COPY  	25 RS BR 387 
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granting or denying the request for stay within five (5) calendar days from the 1 
time the application for stay is received by the president or his or her 2 
designee. If the president or his or her designee fails to timely issue a written 3 
decision, then the stay is deemed granted. The president or his or her designee 4 
may rescind a stay granted under this subsection for good cause. 5 
(e) A person who is denied a stay by the president or his or her designee, or has a 6 
previously granted stay rescinded under paragraph (d) of this subsection, may 7 
petition the corporation to overrule the president's or designee's denial or 8 
rescission of the stay. The petition shall be filed in writing with the 9 
chairperson of the board of directors of the corporation and received by the 10 
chairperson within ten (10) calendar days of the mailing of the president's or 11 
designee's denial of the stay. The petition shall state the name, address, phone 12 
number, and signature of the petitioner; a statement of justification of the stay; 13 
and the time period for which the stay is requested. The chairperson shall 14 
convene a special meeting of the board of directors of the corporation within 15 
ten (10) calendar days of receipt of the petition, and the corporation shall issue 16 
a written final order granting or denying the petition within two (2) calendar 17 
days of the special meeting. If the corporation fails to timely issue a final 18 
order on the petition, then the stay is granted. The corporation may rescind a 19 
stay granted under this subsection for good cause. 20 
(f) A person who is denied or has a previously granted stay rescinded by the 21 
corporation may file an appeal of the final written order of the corporation in 22 
the Circuit Court of the county in which the cause of action arose. 23 
(g) The fact that a stay is granted is not a presumption that the ruling by the 24 
stewards is invalid. 25 
(3) If any license is denied, suspended, or revoked, or if any licensee or other person 26 
participating in Kentucky horse racing is assessed an administrative fine or required 27  UNOFFICIAL COPY  	25 RS BR 387 
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to forfeit or return a purse, after a hearing by the stewards or by the corporation 1 
acting on a complaint or by its own volition, the corporation shall grant the 2 
applicant, licensee, or other person the right to appeal the decision, and upon 3 
appeal, an administrative hearing shall be conducted in accordance with KRS 4 
Chapter 13B. 5 
(4) The corporation may at any time order that any case pending before the stewards be 6 
immediately transferred to the corporation for an administrative hearing conducted 7 
in accordance with KRS Chapter 13B. 8 
(5) (a) In an administrative appeal to the corporation by a licensee or other person 9 
participating in Kentucky horse racing, the corporation may determine in its 10 
final order that the appeal is frivolous. If the corporation finds that an appeal 11 
is frivolous: 12 
1. This fact shall be considered an aggravating circumstance and may be 13 
considered in assessing any penalty against the licensee; and 14 
2. The licensee or other person who raised the appeal may be required to 15 
reimburse the corporation for the cost of the investigation of the 16 
underlying circumstances of the case and the cost of the adjudication of 17 
the appeal. Costs may include but are not limited to fees paid to a 18 
hearing officer or court reporter, attorneys fees, and laboratory expenses. 19 
(b) The corporation may[shall] by administrative regulation prescribe the 20 
conditions or factors by which an appeal may be determined to be frivolous. 21 
(6) Any administrative action authorized in this chapter shall be in addition to any 22 
criminal penalties provided in this chapter or under other provisions of law. 23 
Section 42.   KRS 230.361 is amended to read as follows: 24 
(1) (a) The corporation may[shall] promulgate administrative regulations governing 25 
and regulating mutuel wagering on horse races under what is known as the 26 
pari-mutuel system of wagering. 27  UNOFFICIAL COPY  	25 RS BR 387 
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(b) The wagering shall be conducted only by a person licensed under this chapter 1 
to conduct a race meeting and only upon the licensed premises, and provided 2 
further that only pari-mutuel wagering on simulcasting shall be allowed at 3 
simulcast facilities. 4 
(c) The pari-mutuel system of wagering shall be operated only by a totalizator or 5 
other mechanical equipment approved by the corporation. The corporation 6 
shall not require any particular make of equipment. 7 
(2) The corporation may[shall] promulgate administrative regulations governing and 8 
regulating sports wagering, including administrative regulations for the deposit of 9 
funds by credit or debit cards or other means of electronic funds transfer. The 10 
corporation may[shall] promulgate administrative regulations to establish a fully 11 
functioning sports wagering system within six (6) months after June 29, 2023. 12 
(3) The operation of a pari-mutuel system for betting, or the conduct of sports 13 
wagering, where authorized by law shall not constitute grounds for the revocation 14 
or suspension of any license issued and held under KRS 242.1238 and 243.265. 15 
(4) The corporation may promulgate administrative regulations governing all 16 
reported but unclaimed pari-mutuel winning tickets and unredeemed pari-mutuel 17 
vouchers held in this state by any person or association operating a pari-mutuel or 18 
similar system of betting authorized under this chapter. The unclaimed pari-19 
mutuel winning tickets and unredeemed pari-mutuel vouchers[at horse race 20 
meetings] shall be presumed abandoned if not claimed by the person entitled to 21 
them within one (1) year from the time the ticket was issued[became payable]. 22 
(5) The corporation may issue a license to conduct pari-mutuel wagering on steeple 23 
chases or other racing over jumps; if all proceeds from the wagering, after expenses 24 
are deducted, is used for charitable purposes. If the dates requested for such a 25 
license have been granted to a track within a forty (40) mile radius of the race site, 26 
the corporation shall not issue a license until it has received written approval from 27  UNOFFICIAL COPY  	25 RS BR 387 
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the affected track. Pari-mutuel wagering licensed and approved under this 1 
subsection shall be limited to four (4) days per year. All racing and wagering 2 
authorized by this subsection shall be conducted in accordance with applicable 3 
administrative regulations promulgated by the corporation. 4 
Section 43.   KRS 230.374 is amended to read as follows: 5 
All sums reported and paid to the corporation under the provisions of KRS 230.361 to 6 
230.373, with the exception of funds paid under Section 10 of this Act and KRS 230.398, 7 
shall be paid by the corporation to the Kentucky Racing Health and Welfare Fund, Inc., a 8 
nonprofit charitable corporation, organized for the benefit, aid, assistance, and relief of 9 
Thoroughbred owners, trainers, jockeys, valets, exercise riders, grooms, stable attendants, 10 
pari-mutuel clerks, and other Thoroughbred racing personnel employed in connection 11 
with racing, and their spouses and children, who can demonstrate their need for financial 12 
assistance connected with death, illness, or off-the-job injury and are not otherwise 13 
covered by union health and welfare plans, workers' compensation, Social Security, 14 
public welfare, or any type of health, medical, death, or accident insurance. These sums 15 
shall be paid on or before December 31 in each year, however, no payments shall be 16 
made by the corporation to the Kentucky Racing Health and Welfare Fund, Inc., unless 17 
the corporation and the Auditor of Public Accounts are satisfied that the fund is in all 18 
respects being operated for the charitable and benevolent purposes as set forth in this 19 
section and that no part of the funds paid to the fund by the corporation or any net 20 
earnings of the fund inure to the benefit of any private individual, director, officer, or 21 
member of the fund or any of the persons who turned over sums to the corporation 22 
representing unclaimed pari-mutuel tickets. 23 
Section 44.   KRS 230.779 is amended to read as follows: 24 
(1) Notwithstanding KRS 230.361(1), a licensee may operate the hub either 25 
independently or in association with one (1) or more racetracks licensed by the 26 
corporation to run live races and conduct pari-mutuel wagering in Kentucky. Hub 27  UNOFFICIAL COPY  	25 RS BR 387 
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operations may be physically located on property other than that operated by a 1 
racetrack and may accept wagers at that location and shall comply with the 2 
Interstate Horseracing Act, 15 U.S.C. secs. 3001 to 3007. 3 
(2) As a part of the application for licensure as a hub, an applicant shall submit a 4 
detailed plan of operations in a format and containing any information as required 5 
by the corporation. The application shall be accompanied by an application fee to 6 
cover incremental costs to the corporation, in an amount the corporation determines 7 
to be appropriate. At a minimum, the operating plan shall address the following: 8 
(a) The manner in which the proposed wagering system will operate, including its 9 
proposed operating schedule; 10 
(b) The requirements for a qualified subscriber-based service set out in KRS 11 
230.775; and 12 
(c) The requirements for accounts established and operated for persons whose 13 
principal residence is outside of the Commonwealth of Kentucky. 14 
(3) The corporation may require changes in a proposed plan of operations as a 15 
condition of licensure. Subsequent material changes in the system's operation shall 16 
not occur unless approved by the corporation. 17 
(4) The corporation may conduct investigations or inspections or request additional 18 
information from any applicant as it deems appropriate in determining whether to 19 
approve the license application. 20 
(5) An applicant licensed under this section may enter into any agreements that are 21 
necessary to promote, advertise, and further the sport of horse racing, or for the 22 
effective operation of hub operations, including, without limitation, interstate 23 
account wagering, television production, and telecommunications services. 24 
(6) The corporation may[shall] promulgate administrative regulations to effectuate the 25 
provisions of KRS 230.775 to 230.785. The administrative regulations shall include 26 
but not be limited to criteria for licensing, the application process, the format for the 27  UNOFFICIAL COPY  	25 RS BR 387 
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plan of operations, requisite fees, procedures for notifying the corporation of 1 
substantive changes, contents of agreements entered into under subsection (5) of 2 
this section, procedures for accounting for wagers made, and other matters 3 
reasonably necessary to implement KRS 230.775 to 230.785. 4 
(7) The corporation may require the hub to make the following payments to the 5 
corporation: 6 
(a) A license fee not to exceed two hundred dollars ($200) per operating day; and 7 
(b) A fee of not more than one percent (1%) of the hub's total gross wagering 8 
receipts. 9 
(8) A hub's records and financial information shall not be subject to the provisions of 10 
KRS 61.870 to 61.884. 11 
(9) The Auditor of Public Accounts may review and audit all records and financial 12 
information of the hub, including all account information. The Auditor shall prepare 13 
a report of the review and audit which shall not contain any proprietary information 14 
regarding the hub. A copy of the report shall be sent to the Legislative Research 15 
Commission for referral to the appropriate committee. 16 
Section 45.   KRS 230.805 is amended to read as follows: 17 
(1) The corporation shall institute a system of sports wagering in conformance with 18 
federal law, this chapter, and by administrative regulations promulgated under the 19 
authority of KRS 230.215. 20 
(2) Sports wagering shall not be offered in this state except as authorized by this 21 
section and KRS 230.811. A track that holds a license to operate sports wagering 22 
may contract with sports wagering service providers to conduct or manage sports 23 
wagering operations as authorized by this chapter. Sports wagering may be 24 
provided at a licensed facility for sports wagering or online through a website or 25 
mobile application. The licensed facility for sports wagering or a sports wagering 26 
service provider may provide sports wagering through a website or mobile interface 27  UNOFFICIAL COPY  	25 RS BR 387 
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as approved by the corporation. The corporation may provide temporary licenses to 1 
licensed facilities for sports wagering or sports wagering service providers, if the 2 
corporation deems that the information submitted by them is sufficient to determine 3 
the applicant's suitability. The corporation may[shall] promulgate administrative 4 
regulations to establish the suitability for temporary and ordinary license 5 
applications for licensed facilities for sports wagering, sports wagering service 6 
providers, and any related parties. 7 
(3) Sports wagering licensees and service providers that accept wagers online via 8 
websites and mobile applications shall impose the following requirements: 9 
(a) Prior to placing a wager online via websites or mobile applications operated 10 
by either a sports wagering licensee or a service provider, a patron shall 11 
register the patron's sports wagering account with the operating sports 12 
wagering licensee or service provider either in person at a licensed facility for 13 
sports wagering or remotely through the service provider's website or mobile 14 
application; 15 
(b) 1. The registration process shall include attestation that the patron meets 16 
the requirements to place a wager with a sports wagering licensee or 17 
service provider in this state. 18 
2. Prior to verification of a patron's identity, a sports wagering licensee or 19 
service provider shall not allow the patron to engage in sports wagering, 20 
make a deposit, or process a withdrawal via the patron's sports wagering 21 
account. 22 
3. A sports wagering licensee or service provider shall implement 23 
commercially and technologically reasonable procedures to prevent 24 
access to sports wagering by any person under the age of eighteen (18): 25 
a. At a licensed facility; and 26 
b. Online via website or mobile application. 27  UNOFFICIAL COPY  	25 RS BR 387 
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4. A sports wagering licensee or service provider may use information 1 
obtained from third parties to verify that a person is authorized to open 2 
an account, place wagers, and make deposits and withdrawals; 3 
(c) A sports wagering licensee or service provider shall adopt an account 4 
registration policy to ensure that all patrons are authorized to place a wager 5 
with a sports wagering licensee or service provider within the Commonwealth 6 
of Kentucky. This policy shall include, without limitation, a mechanism by 7 
which to: 8 
1. Verify the name and age of the patron; 9 
2. Verify that the patron is not prohibited from placing a wager; and 10 
3. Obtain the following information: 11 
a. A physical address other than a post office box; 12 
b. A phone number; 13 
c. A unique user name; and 14 
d. An e-mail account; 15 
(d) A sports wagering licensee or service provider shall use all commercially and 16 
technologically reasonable means to ensure that each patron is limited to one 17 
(1) account with that service provider in the Commonwealth, but nothing in 18 
this paragraph restricts a patron from holding other sports wagering accounts 19 
in other jurisdictions; 20 
(e) A sports wagering licensee or service provider, in addition to complying with 21 
state and federal law pertaining to the protection of the private, personal 22 
information of patrons, shall use all other commercially and technologically 23 
reasonable means to protect this information consistent with industry 24 
standards; 25 
(f) A sports wagering licensee or service provider shall use all commercially and 26 
technologically reasonable means to verify the identity of the patron making a 27  UNOFFICIAL COPY  	25 RS BR 387 
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deposit or withdrawal; 1 
(g) A sports wagering licensee or service provider shall utilize geolocation or 2 
geofencing technology to ensure that wagers are only accepted from patrons 3 
who are physically located in the Commonwealth. A sports wagering licensee 4 
or service provider shall maintain in this state its servers used to transmit 5 
information for purposes of accepting or paying out wagers on a sporting 6 
event placed by patrons in this state; 7 
(h) A patron may fund the patron's account using any acceptable form of payment 8 
or advance deposit method, which shall include the use of cash, cash 9 
equivalents, credit cards, debit cards, automated clearing house, other 10 
electronic methods, and any other form of payment authorized by the 11 
corporation; and 12 
(i) The corporation may enter into agreements with other jurisdictions or entities 13 
to facilitate, administer, and regulate multijurisdictional sports betting by 14 
sports betting operators to the extent that entering into the agreement is 15 
consistent with state and federal laws and the sports betting agreement is 16 
conducted only in the United States. 17 
(4) A track may contract with no more than three (3) service providers at a time to 18 
conduct and manage services and technology which support the operation of sports 19 
betting both on the track and online via websites and mobile applications. The 20 
website or mobile application used to offer sports betting shall be offered only 21 
under the same brand as the track or that of the service provider contracted with the 22 
track, or both. 23 
(5) A track or service provider through an agreement with a licensed track shall not 24 
offer sports wagering until the corporation has issued a sports wagering license to 25 
the track, except for temporary licenses authorized under KRS 230.814. 26 
(6) (a) A track licensed under KRS 230.811 may offer sports wagering at a facility 27  UNOFFICIAL COPY  	25 RS BR 387 
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that meets the definition of "track" in KRS 230.210. 1 
(b) A simulcast facility may offer sports wagering through an agreement with a 2 
track by using any of that track's already established service providers. 3 
Section 46. KRS 238.536 (Effective July 1, 2025) is amended to read as 4 
follows: 5 
(1) The net receipts from charitable gaming retained by a charitable organization for 6 
the previous calendar year, provided the charitable organization was licensed at the 7 
start of the calendar year, shall be equal to or greater than forty percent (40%) of the 8 
adjusted gross receipts of the charitable organization for the same period. A 9 
licensed charitable organization shall expend net receipts exclusively for purposes 10 
consistent with the charitable, religious, educational, literary, civic, fraternal, or 11 
patriotic functions or objectives for which the licensed charitable organization 12 
received and maintains federal tax-exempt status, or consistent with its status as[ a 13 
common school,] an institution of higher education, or a state college or university. 14 
No net receipts shall inure to the benefits or financial gain of an individual. Any 15 
charitable organization which permits its license to expire or otherwise lapse shall 16 
still be subject to the retention requirement. The following fees and taxes shall be 17 
excluded from the calculation of the percentage retained, retroactive to calculations 18 
made for calendar year 1999: 19 
(a) All fees paid to the office during the calendar year; 20 
(b) Any sales or use taxes levied under KRS Chapter 139 on charitable gaming 21 
supplies and equipment that are paid by a licensed charitable organization 22 
during the calendar year; and 23 
(c) Any federal excise taxes levied under 26 U.S.C. secs. 4401 and 4411 and paid 24 
by a licensed charitable organization during the calendar year. 25 
(2) The following actions shall be imposed on a licensed charitable organization that 26 
fails to retain the requisite percentage of adjusted gross receipts required in 27  UNOFFICIAL COPY  	25 RS BR 387 
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subsection (1) of this section. The calculation of percentages shall be rounded to the 1 
nearest tenth of a percent: 2 
(a) If the percentage retained is between thirty-five percent (35%) and thirty-nine 3 
and nine-tenths percent (39.9%), the licensee shall be placed on probation for 4 
a period of six (6) months and shall be required to submit to the office an 5 
acceptable financial plan detailing corrective actions to be taken by the 6 
licensee to achieve the forty percent (40%) threshold by the end of the 7 
calendar year in which the probation is imposed; 8 
(b) If the percentage retained is between thirty percent (30%) and thirty-four and 9 
nine-tenths percent (34.9%), the licensee shall be placed on probation for a 10 
period of one (1) year and shall be required to submit to the office a financial 11 
plan as described in paragraph (a) of this subsection. The office shall conduct 12 
a six (6) month review of the charitable gaming activities of a licensee placed 13 
on probation pursuant to this subsection to evaluate the licensee's compliance 14 
with its financial plan; 15 
(c) If the percentage retained falls between twenty-nine and nine-tenths percent 16 
(29.9%) and twenty-five percent (25%), the licensee shall be placed on 17 
probation for a period of one (1) year, shall submit to the office an acceptable 18 
financial plan as described in paragraph (a) of this subsection, and shall 19 
participate in a mandatory training program designed by the office. The office 20 
shall conduct a quarterly review of the licensee's activities to evaluate the 21 
licensee's compliance with its financial plan and its progress toward 22 
achievement of the forty percent (40%) threshold during the probationary 23 
period; 24 
(d) If the percentage falls below twenty-five percent (25%) or if the licensee fails 25 
to attain the forty percent (40%) threshold for a second consecutive calendar 26 
year, the licensee shall have its license suspended for a period of one (1) year; 27  UNOFFICIAL COPY  	25 RS BR 387 
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and 1 
(e) For purposes of paragraphs (a), (b), (c), and (d) of this subsection, periods of 2 
probation and suspension shall commence, unless appealed, from the date the 3 
office notifies the licensee of its failure to satisfy the retention requirement for 4 
the previous calendar year. If a probation or suspension is appealed, the action 5 
shall commence on the date final adjudication of the matter is complete. 6 
(3) Any licensee that has had its license suspended under the provisions of subsection 7 
(2)(d) of this section shall be required to submit to the office an acceptable financial 8 
plan as described in subsection (2)(a) of this section, upon applying for 9 
reinstatement of its license. As a condition of reinstatement, the licensee shall be on 10 
probation for a period of one (1) year and shall be subject to quarterly review by the 11 
office in accordance with subsection (2)(c) of this section. 12 
Section 47. KRS 238.540 (Effective July 1, 2025) is amended to read as 13 
follows: 14 
(1) Charitable gaming shall be conducted by a licensed charitable organization at the 15 
location, date, and time which shall be stated on the license. The licensee shall 16 
request a change in the date, time, or location of a charitable gaming event by mail, 17 
electronic mail, or facsimile transmission, and shall submit a lease and an original 18 
signature of an officer. The office shall process this request and issue or deny a 19 
license within ten (10) days. 20 
(2) All premises or facilities on which or in which charitable gaming is conducted shall 21 
meet all applicable federal, state, and local code requirements relating to life, safety, 22 
and health. 23 
(3) A license to conduct charitable gaming shall be prominently displayed on or in the 24 
premises where charitable gaming is conducted, in a conspicuous location that is 25 
readily accessible to gaming patrons as well as employees of the office, law 26 
enforcement officials, and other interested officials. 27  UNOFFICIAL COPY  	25 RS BR 387 
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(4) At least one (1) chairperson who is listed on the application for licensure shall be at 1 
each charitable gaming activity conducted by the charitable organization and shall 2 
be responsible for the administration and conduct of the charitable gaming activity. 3 
No person shall serve as chairperson for more than one (1) charitable organization. 4 
The chairperson shall be readily identifiable as the chairperson and shall be present 5 
on the premises continuously during the charitable gaming activity. Charitable 6 
gaming shall be conducted and administered solely by officers, members, and bona 7 
fide employees of the licensed charitable organization. Volunteer personnel, who 8 
may or may not be members of the licensed charitable organization, may be utilized 9 
if each volunteer is readily identifiable as a volunteer. No person engaged in the 10 
conduct and administration of charitable gaming shall receive any compensation for 11 
services related to the charitable gaming activities, including tipping. No net 12 
receipts derived from charitable gaming shall inure to the private benefit or 13 
financial gain of any individual. Any effort or attempt to disguise any other type of 14 
compensation or private inurement shall be considered an unauthorized diversion of 15 
funds and shall be actionable under KRS 238.995. 16 
(5) No licensed charitable organization shall contract with, or otherwise utilize the 17 
services of, any management company, service company, or consultant in managing 18 
or conducting any aspect of charitable gaming. 19 
(6) A licensed charitable organization shall not purchase or lease charitable gaming 20 
supplies and equipment from any person not licensed as a distributor in the 21 
Commonwealth of Kentucky. 22 
(7) A licensed charitable organization shall not accept any merchandise prizes donated 23 
by any owner, officer, employee, or contractee of a licensed manufacturer, 24 
distributor, charitable gaming facility, or any of their affiliates, or any member of 25 
their immediate families. 26 
(8) (a) Each organization's gaming supplies shall be maintained in a location separate 27  UNOFFICIAL COPY  	25 RS BR 387 
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from another organization's gaming supplies. 1 
(b) This location shall also be locked and access shall be controlled. 2 
(c) Unless otherwise directed by the office, an organization's supplies and 3 
equipment remain the property of the organization regardless of where they 4 
are stored and shall[must] be accessible to the organization at all reasonable 5 
times upon request. 6 
(9) Any advertisement of charitable gaming, regardless of the medium used, shall 7 
contain the name of the charitable organization conducting the charitable gaming 8 
and its license number. An advertisement for a bingo session or sessions shall not 9 
advertise a bingo prize in excess of the limitation of five thousand dollars ($5,000) 10 
per twenty-four (24) hour period set forth in KRS 238.545(1)(a). 11 
Section 48. KRS 238.550 (Effective July 1, 2025) is amended to read as 12 
follows: 13 
(1) All adjusted gross receipts from charitable gaming shall be handled only by 14 
chairpersons, officers, or employees of the licensed charitable organization. 15 
(2) Except as authorized by subsection (11) of this section, within five (5)[two (2)] 16 
business days after the completion of a charitable gaming event or session, all gross 17 
receipts and adjusted gross receipts shall be deposited into one checking account 18 
devoted exclusively to charitable gaming. This checking account shall be 19 
designated the "charitable gaming account," and the licensed charitable 20 
organization shall maintain its account at a financial institution located in the 21 
Commonwealth of Kentucky. No other funds may be deposited or transferred into 22 
the charitable gaming account. 23 
(3) All payments for charitable gaming expenses, payments made for prizes purchased, 24 
and any charitable donations from charitable gaming receipts shall be made from 25 
the charitable gaming account and the payments or donations shall be made only by 26 
bona fide officers of the organization by checks having preprinted consecutive 27  UNOFFICIAL COPY  	25 RS BR 387 
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numbers and made payable to specific persons or organizations. No check drawn on 1 
the charitable gaming account may be made payable to "cash," or "bearer," except 2 
that a licensed charitable organization may withdraw start-up funds for a charitable 3 
gaming event or session from the charitable gaming account by check made payable 4 
to "cash" or "bearer," if these start-up funds are redeposited into the charitable 5 
gaming account together with all adjusted gross receipts derived from the particular 6 
event or session. Checks shall be imprinted with the words "charitable gaming 7 
account" and shall contain the organization's license number on the face of each 8 
check. Payments for charitable gaming expenses, prizes purchased, and charitable 9 
donations may be made by electronic funds transfer if the payments are made to 10 
specific persons or organizations. The corporation may by administrative regulation 11 
adopt alternative reporting requirements for charitable gaming of limited scope or 12 
duration, if these requirements are sufficient to ensure accountability for all moneys 13 
handled. 14 
(4) A licensed charitable organization shall expend net receipts exclusively for 15 
purposes consistent with the charitable, religious, educational, literary, civic, 16 
fraternal, or patriotic functions or objectives for which the licensed charitable 17 
organization received and maintains federal tax-exempt status, or consistent with its 18 
status as[ a common school,] an institution of higher education, or a state college or 19 
university. No net receipts shall inure to the private benefit or financial gain of any 20 
individual. 21 
(5) Accurate records and books shall be maintained by each organization exempt from 22 
licensure under KRS 238.535(1)(a) and each licensed charitable organization for a 23 
period of three (3) years. Office staff shall have access to these records at 24 
reasonable times. Licensed charitable organizations and exempt organizations shall 25 
maintain their charitable gaming records at their offices or places of business within 26 
the Commonwealth of Kentucky as identified in their license applications or 27  UNOFFICIAL COPY  	25 RS BR 387 
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applications for exempt status. An exempt organization shall submit a yearly 1 
financial report in accordance with KRS 238.535(2), and failure to file this report 2 
shall constitute grounds for revocation of the organization's exempt status. 3 
(6) All licensed charitable organizations that have annual gross receipts of two hundred 4 
thousand dollars ($200,000) or less and do not have a weekly bingo session shall 5 
report to the office annually at the time and on a form established in administrative 6 
regulations promulgated by the corporation. 7 
(7) All other licensed charitable organizations shall submit reports to the office at least 8 
quarterly at the time and on a form established in administrative regulations 9 
promulgated by the corporation. 10 
(8) Failure by a licensed charitable organization to file reports required under this 11 
chapter shall constitute grounds for revocation of the organization's license or 12 
denial of the organization's application to renew its license in accordance with KRS 13 
238.560(3). Reports filed by a licensed charitable organization shall include but 14 
shall not be limited to the following information: 15 
(a) All gross receipts received from charitable gaming for the reporting period, 16 
classified by type of gaming activity; 17 
(b) The names and addresses of all persons who are winners of prizes having a 18 
fair market value of six hundred dollars ($600) or more; 19 
(c) All expenses paid and the names and addresses of all persons to whom 20 
expenses were paid; 21 
(d) All net receipts retained and the names and addresses of all charitable 22 
endeavors that received money from the net receipts; and 23 
(e) Any other information the office deems appropriate. 24 
(9) No licensed charitable organization shall incur charitable gaming expenses, except 25 
as provided in this chapter. No licensed charitable organization shall be permitted to 26 
expend amounts in excess of prevailing market rates for the following charitable 27  UNOFFICIAL COPY  	25 RS BR 387 
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gaming expenses: 1 
(a) Charitable gaming supplies and equipment; 2 
(b) Rent; 3 
(c) Utilities; 4 
(d) Insurance; 5 
(e) Advertising; 6 
(f) Janitorial services; 7 
(g) Bookkeeping and accounting services; 8 
(h) Security services; 9 
(i) Membership dues for its participation in any charitable gaming trade 10 
organization; and 11 
(j) Any other expenses the corporation may determine by administrative 12 
regulation to be legitimate. 13 
(10) No licensed charitable organization shall expend receipts from charitable gaming 14 
activities nor incur expenses to form, maintain, or operate as a labor organization. 15 
(11) For the purposes of deposits under subsection (2) of this section, a licensed 16 
charitable organization conducting charitable gaming events or sessions shall only 17 
be required to deposit its gross receipts and adjusted gross receipts one (1) time per 18 
week if the following conditions are met: 19 
(a) The charitable gaming involves only games using charity game tickets; 20 
(b) The charitable gaming is not part of a charity fundraising event; and 21 
(c) The licensed charitable organization's deposits of gross receipts and adjusted 22 
gross receipts from charitable gaming total less than two thousand five 23 
hundred dollars ($2,500) in the week prior to the deposit. 24 
Section 49. KRS 238.560 (Effective July 1, 2025) is amended to read as 25 
follows: 26 
(1) The office may investigate allegations of wrongdoing upon complaint or upon its 27  UNOFFICIAL COPY  	25 RS BR 387 
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own volition. The corporation by administrative regulation may[shall] establish 1 
procedures for receiving and investigating complaints in an expeditious manner. 2 
(2) In carrying out its enforcement responsibilities, the office may: 3 
(a) Inspect and examine all premises in which or on which charitable gaming is 4 
conducted or charitable gaming supplies or equipment are manufactured or 5 
distributed; 6 
(b) Seize and remove from premises and impound charitable gaming supplies and 7 
equipment for the purposes of examination and inspection pursuant to an 8 
appropriate court order; 9 
(c) Demand access to, inspect, and audit books and records of licensees for the 10 
purpose of determining compliance with laws and the corporation's 11 
administrative regulations relative to charitable gaming; and 12 
(d) Conduct in-depth audits and investigations, when warranted. 13 
(3) (a) As used in this subsection, "willful" means that the conduct constituting the 14 
violation was committed with intent, not accidentally or inadvertently. 15 
(b) The office may take appropriate administrative action against any person 16 
licensed under this chapter for any violation of the provisions of this chapter 17 
or administrative regulations promulgated thereunder subject to the conditions 18 
established by this subsection. 19 
(c) The office may deny a license, suspend or revoke a license, issue a cease and 20 
desist order, place a license holder on probation, issue a letter of reprimand or 21 
letter of warning, and levy a fine. An administrative fine shall not exceed one 22 
thousand dollars ($1,000) for each offense. The office may deny the issuance 23 
of a license or a license renewal if the applicant or licensee has failed to pay a 24 
fine levied by the office. The corporation may[shall] by administrative 25 
regulation classify types of offenses and the recommended administrative 26 
action. The type of action to be taken shall be based on the history of previous 27  UNOFFICIAL COPY  	25 RS BR 387 
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violations and the nature, severity, and frequency of the offense. 1 
Administrative action authorized in this section shall be in addition to any 2 
criminal penalties provided in this chapter or under other provisions of law. 3 
(d) 1. Notwithstanding any other provisions of this section, the office shall 4 
review, within two (2) months of receipt, timely filed organization 5 
quarterly reports that include payment of the fee due as reflected on the 6 
organization quarterly report. If the office discovers reporting errors that 7 
are not willful, the office shall, prior to taking any other administrative 8 
action, issue a letter of warning to the licensee and allow the licensee 9 
thirty (30) days from the issuance of the letter to correct the identified 10 
violation. The purpose of this subparagraph is for the office to identify 11 
correctable reporting errors in a timely manner, and to notify the 12 
licensee of the errors prior to the due date of the next organization 13 
quarterly report so that the errors are corrected and are not repeated in 14 
subsequent organization quarterly reports. 15 
2. A review conducted under subparagraph 1. of this paragraph shall not be 16 
considered an audit or final review and acceptance of an organization 17 
quarterly report and payment. The office shall have four (4) years from 18 
the date of filing to fully audit and review an organization quarterly 19 
report, and may pursue administrative actions against the licensee 20 
related to an organization quarterly report or the information reported on 21 
an organization quarterly report within the four (4) year period if 22 
violations or errors that are not willful are discovered. This 23 
subparagraph shall not be construed to require records that are not 24 
needed to audit or review an organization quarterly report to be kept 25 
longer than is required elsewhere in this chapter or in any related 26 
administrative regulations. 27  UNOFFICIAL COPY  	25 RS BR 387 
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3. Notwithstanding the provisions of subparagraph 2. of this paragraph, for 1 
a violation that is determined to be willful, the office may pursue the 2 
administrative actions authorized by this section at any time. 3 
4. A letter of warning issued under this section shall: 4 
a. Identify the violation; 5 
b. Describe the corrective action necessary; 6 
c. Identify the administrative actions that can be taken if the violation 7 
is not addressed; and 8 
d. Provide that the person shall have thirty (30) days to correct the 9 
action leading to the violation. 10 
(4) The office may reinstate a license that has been revoked at any time after two (2) 11 
years from the date of revocation. A license may be reinstated only upon a finding 12 
that the violations for which the license was revoked have been corrected. 13 
(5) All departments, divisions, boards, agencies, officers, and institutions of the 14 
Commonwealth of Kentucky and all subdivisions thereof, in particular local law 15 
enforcement entities, shall cooperate with the office in carrying out its enforcement 16 
responsibilities. 17 
(6) The office shall report any activity or action which would constitute a criminal 18 
offense to the appropriate authorities in the county where the activity or action 19 
occurred and to the Attorney General. 20 
(7) All administrative actions taken under this section shall be subject to the final order 21 
of the corporation[board]. 22 
Section 50.   The following KRS sections are repealed: 23 
230.270  Biennial report to General Assembly required. 24 
238.520  Charitable Gaming Advisory Council.       (Effective July 1, 2025) 25 
238.522  Restriction on promulgating administrative regulations.       (Effective July 1, 26 
2025) 27  UNOFFICIAL COPY  	25 RS BR 387 
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Section 51. The corporation shall evaluate and propose a structure for initial 1 
licensure, license renewals, and license reinstatements for entities involved in horse 2 
racing, sports wagering, and charitable gaming. The corporation shall present its 3 
recommendations to the Interim Joint Committee on Licensing, Occupations, and 4 
Administrative Regulations by October 1, 2025. 5 
Section 52.   Whereas the proper regulation of racing and gaming is crucial to the 6 
economy and the public's trust in the Commonwealth's signature industry, an emergency 7 
is declared to exist, and Sections 4, 9 to 22, and 33 of this Act take effect upon passage 8 
and approval by the Governor or upon its otherwise becoming a law. 9 
Section 53.   Sections 1 to 3, 5 to 8, 23 to 32, and 34 to 51 of this Act take effect 10 
July 1, 2025. 11