A new political action committee funded by sports betting companies like DraftKings and FanDuel is spending big on ads to support three Kentucky House incumbents in their GOP primaries, even though two of the lawmakers previously voted against their legalization in the state.
The candidates each expressed surprise and confusion about who was funding the ads, but had in common their vote against a wide-ranging gambling bill with provisions that some sports betting companies opposed. This year’s House Bill 904 raises the legal age to bet on sports from 18 to 21 and places new restrictions on such companies’ involvement in the growing prediction market industry.
“I feel like I’m living in the twilight zone,” said GOP Rep. Josh Calloway of Irvington, a staunch anti-gambling social conservative who voted against legalizing sports betting in Kentucky in 2023.
Kentucky Conservative Fund reported spending $350,000 on advertisements in April supporting Calloway and Republican incumbents Kim Holloway of Mayfield and Deanna Frazier Gordon of Richmond in their primary races. The PAC is registered as an “independent expenditure-only committee,” which can spend directly on advertisements for or against candidates without their coordination.
Though Kentucky Conservative Fund did not respond to a request for comment and has not yet revealed its donors in filings with the Kentucky Registry of Election Finance, it has the same address, executive and media production vendor as a new consortium of sports betting companies seeking to influence state legislative races across the country.
Win for America is a new super PAC that received $41 million this year from sports betting companies — mostly via DraftKings and FanDuel, which both have licenses to operate in Kentucky. Those funds have been directed to two other super PACs that plan to be involved in state legislative races: The similarly-named American Conservative Fund for GOP primaries and American Future in Democratic primaries.
Representatives of the PACs, DraftKings and FanDuel did not respond to requests for comment, but a Win for American spokesperson told Axios last month they seek to support “candidates who will thoughtfully approach regulation and ensure legal sports betting can continue to support communities through billions in tax revenue and jobs across America.”
The federal filings of the PACs and media reports show the sports betting industry plans to spend on primary races in states like Illinois, North Carolina, Pennsylvania and Ohio where sports betting is legal but facing legislative obstacles, as well as states like Texas, Alabama and Georgia, where lawmakers are still trying to legalize sports betting. The latest April filing from American Conservative Fund shows it gave $3.5 million this year to another similarly-named PAC, Texas Conservative Fund.
Kentucky candidates welcome support, but don’t quite understand it
Over the past month, Kentucky Conservative Fund has spent more than $100,000 each on video advertisements for Calloway, Holloway and Gordon, as well as $16,000 on mailed ads.
Just like their ads in other states, the videos, mailers and digital ads do not mention anything about sports betting or gambling, instead touting the Republican candidates’ records of supporting President Donald Trump, opposing abortion and other conservative positions.
Calloway said he had no idea who was behind the group and why they were supporting him, but remains anti-gambling and only beholden to his district and the principles he campaigned on.
“I have never supported the expansion of gambling,” Calloway said. “I feel like it's an irresponsible way to increase revenue, by preying on people. I just was hoping they didn't start running ads saying I was pro gambling, because I'm not, and my vote record says that.”
Gordon was also surprised by who is funding the PAC supporting her, as she also voted against legalizing sports betting in 2023.
“I'm grateful for any support,” Gordon said. “But I truly didn't know the nature behind this PAC.”
Holloway was not in office in 2023 when sports wagering was legalized, but also wasn’t sure why the industry was spending so much to support her reelection to a second term — correctly noting it has spent more on advertisements for her than her campaign has spent running for the seat over the past three election cycles.
“It's an obscene amount of money,” Holloway said. “And I'm not sure exactly what is going on with that, but nonetheless, they're sending out nice things, so I'll take it.”
Holloway recently posted a photo of the group’s mailers supporting her on social media, but said that there was no coordination and she previously did not know anything about who was behind it.
“They sent one out today, and I thought, I don't even own a red shirt,” Holloway said with a laugh. “Who dressed me in these clothes? I've never worn that outfit.”
Adding to the confusion of the candidates is that they typically are in different ideological factions of the GOP caucus. In past primary cycles, PACs pitted more establishment Republicans against those in the small government “liberty” wing of the party that sometimes bucks the direction of party leaders. Holloway and Calloway usually vote with this liberty faction, whereas Gordon typically sides with GOP leadership.
Kentucky incumbents voted against bill that some in industry opposed
Besides their party affiliation, one thing that Calloway, Holloway and Gordon have in common is that they all voted against HB 904 twice on the House floor this past session.
The wide-ranging gambling bill touched on several different gambling industries in Kentucky, including horse racing, charitable gaming, prediction markets and sports betting. The horse industry supported its legalization of fixed-odds wagering, allowing odds locked in at the time of a wager, as opposed to the current pari-mutuel system.
It also touched on the growing prediction market industry of companies like Kalshi, which allow people to win money by trading on the future outcome of real-world events, whether they involve politics, economics or even sports. The bill sponsors noted that the federal government has the sole ability to regulate such prediction markets, but included provisions to institute a new tax on such wagers and limit the ability of Kentucky sports betting licensees to participate in prediction market activity.
In addition to raising the legal age to bet on sports from 18 to 21, this restriction on sports betting companies being involved in prediction markets drew some opposition from the industry. Some companies like DraftKings, FanDuel and Fanatics — which each have a license in Kentucky and funded Win for America — have launched their own prediction market platforms in other states, including ones like California that have not yet legalized sports betting.
The original version of HB 904 that the GOP incumbents voted against was strongly opposed by these companies, as it would have prevented them from offering prediction market services anywhere in the country in order to maintain their sports betting license in Kentucky.
The bill passed the House by a wide 79-15 margin, but was amended in the Senate to instead only prohibit these companies from offering prediction market services within Kentucky. When it returned to the House for final passage, Calloway, Holloway and Gordon remained among the 19 lawmakers to vote against it.
Joe Maloney, the president of the Sports Betting Alliance that lobbies for the industry across the country, said the companies who form its coalition were split on aspects of the bill in Kentucky, as some are not involved in prediction markets and some already prohibit those under 21 years old from betting on their platforms. For example, FanDuel already has a set minimum age of 21, whereas DraftKings allows those aged 18 to place bets in states where that is legal.
Maloney said his group is pleased that the final version of HB 904 did nothing to dissuade sports betting companies “from continuing to invest in Kentucky, continuing to support the strong legal and regulatory frameworks in place and serve of age consumers in the state of Kentucky with a way to increase their engagement and their level of support.”
Calloway, Holloway and Gordon said they weren’t personally lobbied on HB 904 by any sports betting companies and noted that their opposition to the bill had nothing to do with that industry.
“In my view, I saw that bill as expansion because we were adding another way of gambling by allowing the fixed odds,” Calloway said. “Fixed odds are the most addictive type of gambling.”
Gordon noted the unusual split of votes on HB 904 due to the wide-ranging nature of the bill, as some anti-gambling social conservatives opposed it as an unconstitutional expansion of gambling with fixed-odds horse wagering, but others voted for it because it raises the legal age to bet on sports.
“Our pastors, a lot of them were voting for it,” Gordon said. “And I think it was because of raising the age limits on sports betting. So there were multiple factions going on in that piece of legislation.”
Holloway said she voted against the bill because she viewed it as “picking winners and losers,” which the state should refrain from doing for private businesses.
The changes implemented in HB 904 go into effect in July.
Kentucky’s primary election is on May 19. While several independent PACs have purchased ads supporting and opposing candidates in GOP primaries for the Kentucky legislature, none have spent even remotely close to the $350,000 of ads purchased so far by Kentucky Conservative Fund.
