Attorney Says KY Can Add Sports Wagering Through Bill

Daniel Wallach, a South Florida-based sports gaming attorney, told Kentucky lawmakers Dec. 16 that based on his research of the commonwealth's constitution, a constitutional amendment is not needed to add sports wagering in the state.

Wallach, founder of Wallach Legal, presented his pro-bono findings during a meeting of the Kentucky Interim Joint Committee on Licensing, Occupations, and Administrative Regulations Monday in Frankfort, Ky. That committee is chaired by Rep. Adam Koenig, an Erlanger Republican who Dec. 5 pre-filed a bill for the upcoming 2020 session that would allow sports wagering at racetracks, the Kentucky Motor Speedway, and online/mobile platforms.

In 2019, similar legislation made it out of committee but never made it to the House floor for a vote.

Also the co-founder of the University of New Hampshire School of Law's Sports Wagering and Integrity Program, Wallach said Kentucky doesn't require a change to its constitution to allow sports wagering.

"The Kentucky constitution does not impede this legislative body from authorizing or licensing sports wagering within the commonwealth," Wallach said, adding that there are a number of reasons why a constitutional change isn't needed. 

He said the constitution doesn't address gambling as a whole but rather only a category of gaming, lotteries. He said that didn't happen on accident, noting that other states specifically address all categories of gambling and the Kentucky framers thoroughly discussed the issue..

"Those state constitutions go much further than Kentucky's," Wallach noted. "Kentucky's constitution only prohibits a narrow species of gambling, which is lotteries."

Wallach said going back to the Kentucky constitutional debates of 1890, there's actually discussion on the meaning of a lottery, which outlines the framers' specific intent.

"(The debates) conclusively demonstrate that the ban on lotteries was not meant or designed to include sports betting or ban other forms of wagering or betting. How do we know that? We know that because they considered it. They expressly considered sports betting and other forms of betting," Wallach said, noting one delegate's amendment to expand the constitution to include other forms of wagering beyond the lottery was rejected 52-38. "Only the narrower ban on lotteries stayed in the Kentucky constitution."

Wallach also noted that sports betting, because it includes a level of skill, doesn't fall under the definition of lotteries—citing a number of court cases that back that opinion. In hearing Wallach's expert opinion that the constitution's referral to lotteries doesn't apply to sports betting, Sen. Damon Thayer (Republican, Georgetown) said the expert testimony clearly shows a constitutional change is not needed in the commonwealth to add sports wagering.

"That's the best testimony from a lawyer in front of this committee I've ever heard. I think you just provided this committee with a mic drop moment," Thayer said. "One thing the opponents of sports wagering cannot say is that this issue hasn't been fully vetted because it has been, before this committee, multiple times. I think your testimony today provided an exclamation point before we head into session next month and the House considers Rep. Koenig's bill."

Thayer said lotteries clearly are games of chance and sports wagering is clearly a game of skill.

Rep. Buddy Wheatley (Democrat, Covington) noted that the constitution, besides referring to lotteries, also addresses "gift enterprises." He asked for more detail on the meaning of that phrase. Wallach said because that phrase had not been brought up in current debate, he had not looked into it. But he said he would research it.

The committee did not conduct a vote Monday.