Kentucky, A History of Lottery & Horse Racing

When most Americans get asked what they most associate the Bluegrass State with, the first answer will likely be whiskey, followed by naming the ripe farming region as the home of the world’s most famous horse race, the Kentucky Derby, an event that generates upwards of $500 million in business. Without question, this slice of the US has always been renowned for its storied thoroughbred past, traced back to 18th century Kentucky, showing its roots in private track races from this period.

Despite the state acting as a hotbed for equestrian racing, it has never been synonymous with gambling. That is so, even with Dolly Parton’s Kentucky Gambler and, at one point, Newport, a small city of some fifteen thousand people in Campbell County, getting pegged to become what eventually turned into Las Vegas. Few people know that Sin City was a nickname first used to describe Newport, a town rich with Italian immigrants, that got used as inspiration for Mario Puzzo’s The Godfather.

Today, Kentucky, like always, does not have a super liberal stance regarding games of chance. There are no land-based and KY online casinos. However, the state decided to get with the times and legalized sports betting on March 31, 2023, becoming the 34th US region to do so. It also allowed mobile wagering, coming in as the 25th territory in the country to permit this activity. Yet, below, we explore its deep and vibrant horse racing past and its booming lottery as Kentucky approves of two other forms of betting.

Kentucky’s Horse Racing Linage

Kentucky bears the label Bluegrass State because its seasonal grass carries a rich emerald to blue-green color. The grass is not ideal for hay but is terrific for pastures since it is very palatable and nutritious. Overall, the equine sector in Kentucky is a massive part of the region’s agribusiness. Per data supplied by the University of Kentucky, this industry creates over forty thousand jobs, and it contributes more than three billion to the local economy through the breeding, buying/selling, and racing of horses.

These noble creatures are a sizeable part of Kentucky’s identity. As settlers pushed into this area of the United States in the 18th century, individuals with equestrian experience quickly noticed the land’s potential for breeding horses. They recognized its wealth of quality mineral-based water was excellent for producing dense horse bones. So, they started raising thoroughbreds, and at the same time, racing them was kicking off on the East Coast. During this period, there were no national or state-organized racing competitions. Races were confined to small-town tracks and private farm ones. Nevertheless, eventually, these contests grew bigger, which led to the creation of more impressive courses that started to attract people from all corners of the country.

Revolutionary War hero William Whitley is credited as one of the pioneers of Kentucky horse racing, as he built the Sportsman’s Hill private circular track around 1780. He founded this venue partly due to his hate of the British, declaring that on his track, the race would get run counterclockwise on dirt and not clockwise on grass as English tradition declares.

In 1836, Henry Farris founded the Spring Hill Race Course near Sportsman’s Hill, earning this area the nickname the Saratoga of the South, attracting loads of Southern socialites each summer. The Civil War halted Kentucky’s horse racing, as the elites stopped visiting the area, until in 1875, Louisville played host to the Kentucky Derby, which reestablished this sector in a big way.       

The Establishment of the Kentucky Lottery

If one does a Google search on lottery games in Kentucky, one will see that lotto-style draws were legalized in this section of the nation in April 1989. Six months prior, the state’s residents voted in favor of this, resulting in a 60.08% to 39.2% increase. Hence, this brought forward a constitutional amendment that rendered void Section 226, which prohibited lotteries in Kentucky. The move saw the establishment of the Kentucky Lottery Corporation, which offers a wide range of games, including famed draws like Mega Millions and Powerball, on top of daily ones, and scratch-off tickets. 

Officials say that this hobby generated, in the 2023 fiscal year, $1.8 billion in total sales, representing a 9.8% rise compared to the previous year. Over $380 million were awarded scholarships to Kentucky college students via grant funding.

While officially regulated lotteries started running in 1989 in Kentucky, the pastime has a two-century-long history. Like with horse racing, evidence of the initial lotteries can be dated to the 18th century and used to gather funds for constructing bridges, roads, and public buildings. The initial authorized one happened in 1792 and was used to raise money for the building of a churn in Lexington.

In the 1820s, the state legislature banned them because of public social and economic concerns. Still, those restrictions were enforced only in a few places, allowing illegal draws to operate in the state. Nowadays, the Kentucky Lottery is carefully regulated and has given out around $4 billion in grants and scholarships to students, dramatically helping education in the state.