Kentucky Might Have Fixed-Odds Horse Racing Bets as Bill 904 Goes to Next Stage

Kentucky’s House Bill 904, which passed the state legislature after lawmakers overrode Governor Andy Beshear’s veto a couple of weeks ago, allows racetracks to offer fixed-odds betting on their races to Kentucky residents.

Bill 904 Passes One More Stage

Fixed-odds betting lets bettors secure a specific price at the time they place their wager. For example, if a bet is placed on a horse at 5–1 odds, that return remains unchanged, even if the odds move before the race starts. This approach differs markedly from the pari-mutuel system that has been used at US racetracks for over a century.

Senator Michael Meredith (R-Oakland), who co-sponsored the bill with Senator Matthew Koch (R-Paris), explained that the addition of a fixed-odds racing provision came after discussions with stakeholders who have attended races abroad. Because fixed-odds wagering is more common outside the US, Meredith said there was growing agreement that it could appeal to bettors frustrated with pari-mutuel wagering, particularly due to the influence of CAWs. In addition, Meredith explained that the new system would attract younger bettors, who have gravitated toward fixed-odds sportsbooks.

State regulators will now be responsible for developing the structure for how fixed-odds betting will function in Kentucky. This includes determining who is authorized to offer it and how it will operate alongside pari-mutuel wagering. The Kentucky Horse Racing and Gaming Corporation is expected to lead implementation, although a specific timeline for when fixed-odds bets will become available to players has not yet been set.

Some Oppose the New Law

Churchill Downs, home of the Kentucky Derby – one of the biggest horse racing events in the US, has opposed fixed-odds wagering, and that remains the case. The reason for this could be purely financial, as Churchill Downs might be losing potential income if it decided to offer fixed-odds betting.

There is one fundamental distinction between fixed-odds and pari-mutuel wagering. In horse racing, pari-mutuel betting involves a takeout – a percentage (usually 15% to 25%) of the betting pool that the track removes before payouts are calculated. It helps cover operating expenses and contributes to purse funds. Because of this structure, tracks are assured of collecting a set share regardless of the race outcome. By contrast, fixed-odds betting typically operates on slimmer margins, and profitability is not always guaranteed.

Of course, the law doesn’t oblige Churchill Downs to offer fixed-odds betting, and some other racetracks, such as The Red Mile in Lexington or Kentucky Downs in Franklin, could instead do that.In other news related to Churchill Downs, the company is looking to acquire the intellectual property of the Preakness Stakes and Black-Eyed Susan Stakes in a move that echoes its determination to expand its footprint in the horse racing sector.