Keeneland, Red Mile Announce Temporary Closure of Historical Horse Racing Operations

Keeneland Association and the Red Mile issued a joint press release Jan. 24 announcing the closure of historical horse race (HHR) gaming that the two tracks operate in partnership at the Red Mile harness track. The Sunday morning decision came three days after the Supreme Court of Kentucky ruled that it will not rehear an appealed Sept. 24 decision that told a lower court to re-examine the legality of the most crucial form of funding for purses in the commonwealth.

“We were disappointed the Kentucky Supreme Court denied our petition for rehearing,” the press release stated. “At this time, Keeneland and Red Mile have made the very difficult decision to temporarily close historical horse racing operations until there is more clarity surrounding the situation. We have confidence the Kentucky legislature will continue its efforts to protect jobs and state revenue generated by historical horse racing, as well as protect Kentucky's signature horse racing industry.”

An additional sentence was tacked on to that release on the home page of the Red Mile's website: “Red Mile will close at end of business on Sunday, January 24th. A reopening date has not been identified at this time.”

HHR handled $2.2 billion during the commonwealth's most recent fiscal year, and revenue from that form of gaming annually contributes tens of millions of dollars to the Kentucky purses. This form of gaming has been operational—but challenged by opponents in the courts as illegal—for the better part of a decade on the grounds that HHR does not meet the definition of pari-mutuel wagering.

In its September judgment, the Supreme Court ruled 7-0 that HHR machines made by Exacta Systems do not “create a wagering pool among patrons such that they are wagering among themselves as required for pari-mutuel wagering.”

Although the Supreme Court case only involves HHR machines made by Exacta Systems, whose machines are in use at the Red Mile, Kentucky Downs and Ellis Park, the gaming systems operate in broadly the same manner throughout Kentucky, meaning that a precedent established for one version is likely to affect all forms of HHR gaming.

Churchill Downs, Inc., which owns the tracks and gaming licenses associated with Kentucky's Churchill Downs and Turfway Park, has already halted reconstruction on its demolished Turfway grandstand, vowing late in 2020 not to continue until HHR's legality gets sorted out.

Although Thursday's Supreme Court decision was not entirely unexpected, it eliminated a judicial avenue for keeping HHR functional in Kentucky, making it clearer that getting HHR passed via new legislation remains the Thoroughbred industry's best path forward, according to some stakeholders.

But the Kentucky legislature only meets for 30 days in odd-numbered years, meaning that there is increased time pressure to take up the issue before the 2021 session ends Mar. 30.