Kentucky Lawmakers Override Veto to Enact Sweeping Sports Betting Reform

The new law raises the legal betting age to 21, bans certain college wagers, and introduces new taxes and regulations for fantasy sports. The measures are scheduled to take effect in mid-July.

Beshear’s veto was not aimed at the betting provisions themselves but at an emergency clause included in the bill. This clause would allow agencies such as the Kentucky Horse Racing and Gaming Corporation and the Kentucky Lottery Corporation to implement both standard and emergency regulations without requiring approval from the governor. Beshear argued that this provision undermines the executive branch’s constitutional authority and limits oversight of regulatory actions, particularly those affecting public safety.

Under HB 904, Kentucky introduces several key reforms. The minimum age for sports betting increases from 18 to 21, while prop bets involving in-state college athletes are now prohibited. The legislation also authorizes fixed-odds wagering on horse racing and establishes a new framework for fantasy sports. Notably, “against-the-house” fantasy contests will be eliminated, requiring at least two participants per contest, and all such activities will be taxed at a rate of 12.5%.

The bill also tightens rules around prediction markets. While earlier drafts aimed to block any operator offering such markets anywhere in the U.S. from holding a Kentucky license, lawmakers scaled back the restriction. The final version applies only to operators running prediction markets within the state, following concerns from companies like DraftKings and FanDuel that broader limitations could cost Kentucky up to $40 million annually in tax revenue.

Overriding a gubernatorial veto in Kentucky requires only a simple majority in both legislative chambers, making the outcome largely expected. Lawmakers had already approved HB 904 by comfortable margins in both the House and Senate, and the final override votes reflected similar levels of support.