Gambling interests put big money on Kentucky governor’s race via party governors associations

By: - February 12, 2024 1:51 pm

Gov. Andy Beshear holds up his $20 parlay bet at Churchill Downs in Louisville on the first day of legal sports betting in Kentucky, Sept. 7, 2023. (Kentucky Lantern photo by McKenna Horsley)

FRANKFORT  – Gambling interests ponied up big to outside groups that spent more than $30 million on last year’s race for Kentucky governor.

Kentucky’s horse race tracks that have expanded into new forms of legalized gambling gave big to the Democratic Governors Association in 2023 which spent $19.2 million backing Democratic Gov. Andy Beshear’s reelection.

In reports filed with the Internal Revenue Service last week the DGA disclosed that it got $250,000 from Churchill Downs, $200,000 from Kentucky Downs, and $50,000 from Revolutionary Racing Kentucky during the second half of 2023.

Meanwhile, Pace-O-Matic, the Georgia-based manufacturer of gaming machines, and officials of the company gave at least $362,000 to the Republican Governors Association in 2023. The RGA, in turn, spent $12.7 million backing Republican Attorney General Daniel Cameron’s campaign for governor.

The DGA and RGA are big Washington-based political committees that exist to elect members of their party as governors of the 50 states. They are called “527 organizations” — groups organized under section 527 of the Internal Revenue Service Code that can accept contributions of unlimited amounts from people, corporations, unions and other groups.

By contributing to the two 527 organizations, people and groups were able to give as much as they wanted to support Beshear or Cameron. By contrast, state law limits the amount a person or traditional political action committee can give to a campaign to $2,100. Contributions from corporations are not allowed.

Kentucky was one of only three states that held its election for governor last year, and the only one of the three considered to be competitive.

And both the DGA and RGA made Kentucky a priority. Beshear won the election, capturing about 52.5 percent of the vote. 

The DGA and RGA must disclose names of donors and expenses with the IRS. On Saturday, an IRS website posted reports from each group which disclosed donors for the period between July 1 and Dec. 31. The vast majority of money contributed to each group came in large donations from corporations and individuals from across the country.Because Kentucky had the only competitive election for governor last year, many large donors during this period were from Kentucky or had financial interests in Kentucky.

In-person sports betting opened across Kentucky on Sept. 7. Churchill Downs in Louisville is one one of the nine racetracks eligible to operate retail locations and partner with operators of sports betting apps. (Kentucky Lantern photo by McKenna Horsley)

Here’s what the new reports show about Kentucky donors to each group in the last half of 2023:

Democratic Governors Association

The DGA reported raising $32.4 million during the six-month period.

Three large donors were owners or affiliates of horse racing tracks that hold Kentucky licenses as sports wagering operators. The legislature legalized sports gambling in Kentucky last year. The new law authorizes only race tracks to operate retail sports gambling sites. The law also allows each track to partner with up to three marketing platforms for mobile wagering.

Churchill Downs donated $250,000; Kentucky Downs, of Franklin, gave $200,000; and Revolutionary Racing, of Boston, gave $50,000.

Also, the Kentucky Thoroughbred Association, of Lexington is listed as giving $25,000

The health insurance giant Humana Inc. gave big to both governors associations: $110,000 to the DGA, and $165,500 to the RGA.

Another big donor to both groups was CoreCivic, the operator of privately-run prisons. CoreCivic is listed as giving $155,000 to the DGA and $285,000 to the RGA last year.

Two corporations based in Louisa and headed by Tim Robinson, best known as the chief executive and founder of Addiction Recovery Care, gave big to the DGA. According to the reports Pioneer Health Group gave $40,000; and London ValuRite Pharmacy gave $20,000. (London ValuRite Pharmacy Pharmacy also gave $50,000 to the DGA in the first half of 2023.)

A company called SK FL Investments, of Midway, contributed $50,000. Kentucky Secretary of State records show the owners of this company are Sandeep Kapoor and Frank Lassiter, who are former officials of the Kentucky Cabinet for Health and Family Services who founded the consulting firm HealthTech Solutions which previously contributed to the DGA.

Other Kentucky donors to the DGA in the second half of 2023 include:

  • Sazerac Company, Louisville, $25,000
  • Brown-Forman Corporation, Louisville, $25,000
  • Pace-O-Matic of Pennsylvania, $25,000
  • Southern Star Central Gas Pipeline, Owensboro, $25,000
  • LG&E and KU Services, Louisville, $20,000
  • New Day Recovery Center, Lexington, $20,000
  • John Ridley, Bowling Green, managing director, Stifel Financial, $15,000
  • Case Coal Sales, Louisa, $11,600
  • Seneca Place LLC, Louisville, $10,000
  • Gary L. Taylor, Berea, retired, $10,000
  • Southeast Construction Welding, Hazard, $10,000
  • Valley Stream Operator LLC, Richmond, $10,000

Republican Governors Association

The RGA reported raising $28.8 million in the second half of 2023.

Karmin A. Pace, the owner of Pace-O-Matic, from Duluth, Georgia, contributed $200,000 to the RGA during the period.

In addition, the Pace-O-Matic corporation is listed as making contributions during the period totaling $95,000.

And nine officials of Pace-O-Matic are listed as donors who, when combined, gave a total of $67,000 more to RGA during the period.

Pace-O-Matic is a manufacturer of video games with cash payouts. Critics call them “gray machines” because of their murky legal status, but supporters call them “games of skill.” The most heavily-lobbied bill of the 2023 General Assembly — and one that eventually was enacted into law — banned such machines from the state. That bill pitted Pace-O-Matic against Kentucky’s race tracks.

Pace-O-Matic has filed a lawsuit asking to strike down that law.

The RGA did get some donations from race tracks: Revolutionary Racing of Kentucky, Boston, Massachusetts, gave $25,000. Lexington Trots Breeders Association (the Red Mile), Lexington, gave $25,000.

Other donors to the RGA in the second half of 2023 include: ResCare, Louisville, $50,000; Cleary Construction, Tompkinsville, $25,000; Houchens PAC, Louisville, $10,000.

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Tom Loftus
Tom Loftus

Tom Loftus is a native of Cincinnati and a graduate of The Ohio State University. His long career in Kentucky journalism includes four years as Frankfort bureau chief for The Kentucky Post and 32 years as Frankfort bureau chief for The Courier Journal. He is a member of the Kentucky Journalism Hall of Fame and a freelance reporter for the Kentucky Lantern.

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