Kentucky Bill to Channel Betting Money Toward Local Governments

A new bill in Kentucky seeks to change how the money from the state’s horse racing wagering tax is distributed. Lawmakers proposed injecting some of these proceeds back into local governments, which would thus be able to fund a variety of initiatives.

HB 782 to Redirect Betting Money Toward Communities

Kentucky, for context, currently channels the tax proceeds from bets on horse races back into the industry or into the state’s general fund. As in other markets, a part of the money is used to support the racing ecosystem through research and equine drug testing.

Under House Bill 782, however, some of this money would be redirected toward local governments, allowing them to support critical services, such as law enforcement, affordable housing, homelessness services, and regulation.

Per the measure, 0.1% of the money wagered on live and historical races would be poured into communities.

Addressing the Social Costs of Gambling

Proponents of this measure say that it would effectively address the social costs of gambling. They argued that the gambling industry exposes Kentucky citizens to harm since wagering can be very addictive.

Because of that, supporters of the measure believe that it is time to use some of the billions of dollars gambled on horse races every year to support local governments. Considering the vast growth of the wagering sector, even 0.1% of the money could make a huge change, HB 782 advocates argued.

Daviess County Fiscal Court Judge Executive Charlie Castlen, however, pointed out that there are currently no strict rules on how governments should spend this money, should the measure pass into law. Although he said that communities are poised to benefit if the bill is passed, Castlen admitted that “it might be a good year before any of the money would actually be handed out.”

He explained that lawmakers will use this time to lay out the rules on spending the money governments acquire via HB 782.

Kentucky Bullish on Harm Prevention

The measure comes a month after the 1-800-GAMBLER problem gambling support hotline received 3,240 calls from users in Kentucky in 2024. This marked a significant increase from 2023 and was attributed to the new laws allowing sports betting and the proliferation of ads promoting both gambling and resources to gamble responsibly.

While the increased visibility of the hotline isn’t necessarily bad, the rapid hike in calls suggests that problem gambling is on the rise and something that state officials should address.

To that end, Kentucky initiated a new program to deal with the increase in harm. Under the program, the tax money from sports bets was redirected to the Problem Gambling Assistance Fund, allowing it to be used for various initiatives to tackle problem gambling.