Kentucky officials report sports-wagering revenue, outline uses for problem-gambling fund

Kentucky Horse Racing and Gaming Corporation officials and state behavioral-health staff told a legislative subcommittee on Tuesday that sports wagering has generated millions for state accounts and that the state's problem-gambling assistance fund is being used primarily to build treatment capacity and public education rather than to directly reimburse Medicaid.

Hannah Sims, director for sports wagering at the Kentucky Horse Racing and Gaming Corporation, told the Budget Subcommittee on Economic Development, Protection, Tourism and Energy that sports wagering activity from the launch in September 2023 through fiscal-year 2024 drove $34,840,000 into the state pension fund and about $9,931,000 into the problem-gambling assistance fund. Sims said fiscal-year 2025 deposits to date include roughly $18,500,000 to the pension fund and $556,000 to the problem-gambling fund, bringing all-time totals to about $53.34 million for the pension account and $1.48 million for the problem-gambling assistance account.

The subcommittee heard that the state’s total amount wagered from September 2023 through late 2024 was about $3.5 billion, with approximately $3.39 billion wagered online. Sims gave the adjusted gross revenue figure for the current fiscal year as about $136.5 million and said that 2.5% of taxable gaming revenue is allocated to the problem-gambling assistance fund.

Patty Clark, director of the Division of Mental Health in the Department for Behavioral Health, Developmental and Intellectual Disabilities, said the assistance fund is intended to "address the consequences that individuals may experience as a result of their engagement in online sports wagering," and to support education, certification, training and program monitoring. Clark said the account pays $50,000 for administrative expenses and is being used largely to expand workforce capacity and public-awareness efforts rather than to directly pay for treatment services that are billed to Medicaid or private insurers.

Clark told lawmakers the department issued a notice of funding opportunity in October. On the workforce-development NOFO the department received five proposals, awarded one, denied one and has three still under review. On a public-awareness NOFO, the department received four proposals and has awarded two, with two pending. Clark identified awardees that included the Kentucky Council on Problem Gambling (to expand access to a conference through streaming), Project Ricochet in Lexington (a $100,000 public-awareness award) and a partnership with a youth coalition for school-based outreach. The department also described a problem-gambling resource kit, a helpline and a website with educational resources.

Clark said helpline volume rose to about 3,240 calls in 2024, more than double the prior year, though she said most of those calls were requests for information rather than direct requests for treatment. Clark said fewer than 10 clinicians in Kentucky are certified specifically for problem-gambling treatment and that the department is working to expand that workforce. She told the panel the helpline is answered through River Valley Behavioral Health in Owensboro and operates 24/7.

Members of the committee pressed both agencies on how the money is tracked and how outcomes are measured. Representative Whitten asked whether the department or the gaming corporation received detailed information about who called the helpline or whether callers identified which venue or platform—the track, a sportsbook or an online operator—was involved. Clark replied that helpline calls are handled by counselors who collect only the information the caller provides and that, unless a caller volunteers the detail, the department does not have a reliable breakdown by venue or platform.

Committee members also questioned whether funds from the problem-gambling account should be used to reimburse Medicaid for treatment costs. Clark said the current approach is to build provider capacity and awareness so that community mental-health centers and other providers can screen and treat problem gambling, with many treatment services paid through Medicaid or private insurance. Several members said they wanted further information about how many callers referred to treatment actually engage in services and what the per-person treatment cost is; Clark said the department is working to improve data collection and could provide additional figures later.

No formal votes were taken during the hearing. Chair Figuette closed the session by noting the committee lacked a quorum for minute approval and that the group would reconvene on Feb. 26.