Published: April 27, 2023

Churchill Downs lays out plan for Kentucky sports betting

LOUISVILLE, Ky. (WDRB) -- Louisville-based Churchill Downs Inc. expects sports betting to go live in Kentucky in the second half of 2023, and the company is already striking deals to provide FanDuel and other online platforms access to the state's consumers in exchange for a cut of the action.

Churchill Downs CEO Bill Carstanjen on Thursday laid out a roadmap for the company's plan to capitalize on the Republican-controlled legislature's move in March to authorize sports wagering, making Kentucky the 37th state to allow betting on college and professional sports.

The law takes effect in late June, but the Kentucky Horse Racing Commission has until the end of 2023 to set up regulations and award licenses. Supporters of the law have said they hope it will launch in the fall.

As the biggest horse racing company in the state, Churchill Downs will likely be the biggest player in sports betting. The new law grants the state's nine horse tracks and their offsite gaming venues the exclusive right to host onsite sports betting.

Online and app-based platforms like DraftKings, BetMGM and FanDuel will be able to operate in Kentucky only after reaching an agreement with one of the horse tracks, ensuring they will also receive a cut of the online wagering.

Speaking on the company's quarterly earnings call Thursday, Carstanjen said sports betting will not meaningfully change the finances of the $10 billion horse racing and casino company, but "It'll be a nice bonus."

The main benefit, he said, will be to draw customers to the company's casino-like historical horse racing venues, such as Louisville's Derby City Gaming, where the company offers games that mimic slot machines.

"We find that it does drive traffic to our properties; that it does help the overall energy and flow of people," Carstanjen said on the call. "... It's a really good thing."

Each of Churchill Downs' racetracks and its historical gaming venues will get sports-wagering kiosks in their sports bars, Carstanjen said. Eventually, Churchill Downs will have nine retail locations for sports betting, he said.

However, the vast majority of sports wagering is expected to take place virtually through apps and online platforms, supporters of the law said earlier this year.

"We have entered into contracts to provide certain online wagering platforms including FanDuel access to the Kentucky market in connection with which we receive a revenue stream," Carstanjen said.

He did not specify the terms of the FanDuel deal, nor disclose other online platforms that may partner with Churchill Downs.

A Churchill Downs spokeswoman did not immediately comment. FanDuel also did not immediately respond to a request for comment.

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