Three Kentucky non-profits have filed a lawsuit against the Kentucky Horse Racing and Gaming Commission (KHRG) following an order to disable gaming machines from two manufacturers. The order, issued due to alleged illegal "fishing" activities resulting in significant financial theft, has halted charitable fundraising efforts across the state just before a critical fundraising weekend. Charities argue the shutdown unfairly punishes them and jeopardizes vital community programs.
Key Takeaways
- Three Kentucky charities have sued the KHRG over an order to shut down gaming machines.
- The shutdown is attributed to an illegal "fishing scam" that led to tens of thousands of dollars in theft.
- Non-profits claim the order halts essential fundraising for food assistance, disability support, cancer aid, and more.
- New regulations regarding machine supervisors are also cited as a major obstacle to charitable gaming operations.
The Lawsuit and Its Rationale
The lawsuit, filed by Shirley’s Way, Southwest Center for Developmentally Disabled, and Educational Justice, contends that the KHRG’s order is unlawful and exceeds the commission’s authority. The charities assert that the shutdown disproportionately impacts their ability to raise funds, affecting hundreds of community programs that rely on this revenue stream. They are seeking immediate injunctive relief to allow lawful gaming to resume.
Impact on Charitable Operations
Charitable gaming is a primary source of revenue for numerous non-profits in Kentucky. Shirley’s Way, for instance, reported that nearly 90% of its games were affected, leading to immediate consequences such as the inability to provide meals for approximately 3,500 schoolchildren, canceled financial assistance for cancer patients, and the postponement of a major Christmas Toy Drive. The shutdown also threatens the development of affordable housing for adults with disabilities.
New Regulations Pose Additional Challenges
Beyond the machine shutdown, new regulations from the KHRG are creating further obstacles. A key rule prohibits on-duty employees of businesses housing the gaming machines from serving as supervisors, often referred to as "chairpersons." This change makes it exceedingly difficult for charities to find volunteers to oversee the machines for extended periods, potentially rendering operations impossible even if the machines are reactivated.
Broader Implications for Businesses
The shutdown not only impacts the charities but also the businesses that host the gaming machines. These establishments often rely on rental fees paid by charitable organizations, and the sudden cessation of income could lead to financial difficulties for them as well.
