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April 16, 2024

Kentucky plans tax incentives for racetrack, gaming parlor

3 min read

A proposed harness racetrack and an affiliated gaming parlor slated for two southeastern Kentucky communities received preliminary approval for $23.5 million in state tax incentives last week.

The Kentucky Tourism Development Finance Authority met to review an application from ECL Corbin LLC. ECL Corbin is a joint venture between Lexington thoroughbred track Keeneland and the majority owners of Kentucky Downs, a thoroughbred track in Franklin.

Keeneland along with Ron Winchell and Marc Falcone, the Kentucky Downs majority stakeholders, announced plans last September to build a harness track in Corbin and a satellite facility in Williamsburg. Corbin is about 75 miles south of Lexington. Williamsburg is 15 miles south of Corbin and about 10 miles north of the Tennessee border. 

Both facilities would house historical horse racing (HHR) machines, gaming devices that look like slot machines but use the outcomes of previously run horse races to determine if a player’s wager wins. As with other tracks that operate HHR machines, the Corbin track would use proceeds from them to fund purses for live racing.

The authority’s board went into closed session to review the application and after returning voted unanimously to approve without providing details of the amount approved.

On Friday, Danielle Jones, the executive director for the Kentucky Tourism, Arts and Heritage Cabinet’s Office of Public Affairs and Constituent Services, confirmed to The Center Square the project received preliminary approval for $23.5 million in incentives through the Kentucky Tourism Development Act. The incentives would cover both venues. 

The incentive program allows tourism projects with at least a $1 million investment to recover a quarter of the development costs over a 10-year period. According to the tourism cabinet site, eligible projects include such developments as cultural or historical sites, entertainment facilities and centers and theme restaurant destinations. Incentives are also available for certain lodging projects. 

Interested applicants submit projects to the tourism cabinet secretary for consideration. At the secretary’s recommendation, projects go before the authority for further consideration.

If a project is approved, developers sign an agreement with the state that allows the project to receive the incentives by recovering sales tax receipts. 

In fiscal year 2020, participating developments received nearly $6.3 million in sales tax refunds, and since 2000, the amount refunded totals more than $99 million.

According to cabinet records, other racing and gaming venues have been approved for tourism incentives. That includes Kentucky Downs and Churchill Downs in Louisville.

Representatives from Keeneland referred questions about the project and application to Casey Bolton, a partner with Commonwealth Economics. The Lexington-based advisory firm works with clients to review projects and assist with receiving incentives or tax credits.

Bolton told The Center Square there would not be any public announcements yet as plans were still being finalized.

In April, Keeneland COO Vince Gabbert spoke to the Southern Kentucky Chamber of Commerce about the project. According to the Corbin Times-Tribune, he said the two facilities would create about 250 jobs. Both would also feature restaurants with hotels possible at both sites as well.

The Williamsburg facility, which would be off the first Interstate 75 exit coming from Tennessee, would have 400 HHR machines, according to Gabbert. The Times-Tribune noted that Gabbert also talked about other entertainment options that were being considered there, too.

“It won’t be quite the size of a Dave and Busters but (it may feature) some of the elements of a Dave and Busters type family atmosphere to capture off some of that tourism that’s coming tothe city’s Kentucky Splash Waterpark at the Hal Rogers Family Entertainment Center, Gabbert said.

While there’s no racing happening in Corbin yet, the Kentucky Horse Racing Commission has approved the racing license for the project. It’s holding its first meet this month at The Red Mile in Lexington. The meet is set to conclude on Tuesday.

Now that the project has received preliminary approval, Jones told The Center Square an independent consultant will review the project and draft a study for the authority. That typically takes between six to eight weeks and is paid for by the applicant. Once that’s completed, the project can request final approval.

This article was originally posted on Kentucky plans tax incentives for racetrack, gaming parlor

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