Kentucky Shuts Poker Room and May Put Online Poker on Hold
The legalization of online poker in the Commonwealth of Kentucky was going so well…until it changed course. Not only were lawmakers quick with a bill to legalize online poker in the 2023 state legislative session, Chris Moneymaker opened a membership-only poker room in Kentucky. That was all happening in early January of 2023.
Fast-forward just a few weeks, and everything appears to have changed.
Moneymaker shuttered his room due to threats of criminal prosecution. And the online poker portion of gambling expansion in Kentucky may be tossed out in favor of pushing solely for sports betting.
How We Got Here
After years of lawmakers and Kentucky Governor Andy Beshear pushing for legalized online poker, there was progress in 2022.
A set of bipartisan bills worked their way through the legislature, and the House version took on amendments before it passed and moved to the Senate. But along the way, the proposed changes confused the matter too much. Though there was talk of sports betting moving on without online poker, it turned out that committees killed the bills entirely.
Enter 2023.
Previous online poker champion Republican Representative Adam Koenig lost his primary in 2022, so he couldn’t push another bill this year. Several Democratic members of the state legislature took up the banner, though.
Democratic Representatives Derrick Graham introduced HB106 on January 5, with Representatives Cherlynn Stevenson and Rachel Roberts signing on as cosponsors. The bill proposed the legalization and regulation of online poker, sports wagering, and fantasy contests.
Over on the Senate side, it was another Democratic effort as State Senator David Yates introduced SB73. It would serve as a companion bill to HB106.
Movement or Lack Thereof
Yates’ bill – SB73 – started in the Committee on Committees and moved quickly to Licensing & Occupations, where it has been since February 9.
HB106 is the one that moved. First, it attracted two new sponsors in Democratic Representatives Chad Aull, Alan Gentry, and George Brown. Second, after more than a month in the Committee on Committees, it saw action on February 15 in the form of a floor amendment. The extra wording related to funds raised by igaming and sportsbetting, as any funds remaining after expenses are paid from the state’s proceeds – approximately 5% – will go to a problem gambling assistance fund. The Kentucky Director of Behavior Health will administer the money to handle responsible gambling and address problems and the need for help.
That amendment sent HB106 to the Appropriations & Revenue Committee on February 23.
It is not yet scheduled for a hearing, though that committee will hold one on February 28. It is unclear if HB106 can make it to that docket.
Sports Betting Strikes Again
Word was that the legislature is not yet ready to tackle daily fantasy sports (DFS) and online poker, as many had expressed in 2022. The action of Representative Michael Meredith gave that some credence when he filed HB551 for sports betting only. His bill specifically removed DFS and online poker. And it put the Kentucky Horse Racing Commission in charge of retail betting.
The sports betting bill has been filed. Rep. Michael Meredith, the primary sponsor, tells @LEX18News the bill would only legalize wagering on sporting events.
Online poker and fantasy have been removed to give the bill a better shot at becoming law. pic.twitter.com/AI94uOv4Yh
— Karolina Buczek (@Karolina_Buczek) February 22, 2023
Despite movement on HB106, it appears that some lawmakers are much more prepared to support a sportsbetting-only bill than one that includes online poker.
The last two days in February may signal what happens next.
Moneymaker Social Club
Meanwhile, pertaining to the creation of a live poker scene in Kentucky…
Chris Moneymaker is best known as the 2003 World Series of Poker Main Event champion, the man who prompted the poker boom and whose “Moneymaker effect” expanded poker in ways never before imagined.
Of course, the United States has done everything possible to diminish that effect, at least in the online realm. Live poker thrives and has ballooned in the past few years, especially since the end of pandemic restrictions.
Membership-only poker clubs have been growing in popularity all over Texas, especially in recent years, due to the unavailability of live poker in casinos or racinos. Moneymaker looked at Kentucky – next to his home state of Tennessee – and saw the opportunity to offer live poker to players there. He created Moneymaker Social Club, a game room with a focus on poker and based on membership fees. That incoming money allowed the club to operate without the need to collect rake. And the rake is what most anti-gambling laws prohibit.
Moneymaker opened his club in September 2022 in Paducah, Kentucky. He did so with transparency, speaking about it on his social media and obtaining approval from McCracken County Attorney Sam Clymer.
Was asked by my buddy @CMONEYMAKER to come check out his room and help run this $50k guarantee event leading up to the game on Sunday. First time in Kentucky but having a blast so far and this room is nice. Will give some updates here as it goes for anyone interested. pic.twitter.com/gV4Xu5AbtR
— Justin Hammer (@TheJustinHammer) February 8, 2023
Social Club Ends Poker
In the November 2022 election, Clymer lost, and replacement County Attorney Cade Foster took over. And Foster had plans before he even took the oath of office in mid-December 2022. That led Clymer to step down early and allow Foster to take on the new role in mid-December.
One of the first things Foster did in the new year, then, was to reverse the decision about Moneymaker Social Club. It wasn’t without prompting, though, from the Kentucky Department of Alcohol Beverage Control. That governmental body first denied Moneymaker a liquor license when he applied in 2022. And it was that department that contacted Foster to ask him to look into the legality of the club. Despite Foster previously telling Moneymaker that he would support Clymer’s letter of authority regarding the club, Foster changed his tune upon talking to the ABC.
With that, speculation grew that there may be criminal charges filed against Moneymaker and his staff. For that reason, Moneymaker stopped offering poker.
Unfortunate situation. https://t.co/aGATzmUtJa
— Chris Moneymaker ⭕ (@CMONEYMAKER) February 15, 2023
Moneymaker spoke to Jesse Fullen on the PokerNews Podcast about the situation. He revealed that he was also prepared to go to the local authorities and turn himself in for misdemeanor (and one felony) gambling charges. However, when Moneymaker’s lawyer arranged for the poker pro to simply remove poker from the club, the county officials would not press charges.
In the meantime, Moneymaker is trying to determine a business model that will keep his employees working. He will continue to pursue the right to host poker games, but he is also considering everything from a sports bar to pool hall. And the employees he keeps paying have a month or so to learn new skills or improve themselves while he pays them and tries to figure out what happens next. He also promises to find new employment for them should nothing else work out.
With that said, the likelihood of being able to reopen Moneymaker Social Club as a poker room is not good at this time.
What remains to be seen in the coming days and weeks is if Kentucky lawmakers will fight for poker online or leave those players out of the gambling industry conversations as well.
