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Horse Racing Betting on the Internet in the United States – How Legal Is It?

The Legality of Horse Betting in the US

Online gambling is all the rage lately, and between poker, casino games, and sports betting, you can wager on pretty much anything through your laptop or smartphone.

Even so, outside of the legal states of Nevada, New Jersey, and Delaware, the vast majority of those bets are placed through offshore websites operating illegally – unless you bet on horse racing that is.

While the federal government was waging war on major online betting sites like PokerStars and Bovada, playing the ponies over the internet was explicitly legalized on the federal level. But as is usually the case with the American legal system, understanding where and how you can place an online horse racing bet involves a tangled web of local statutes.

If you’re looking to legally bet on horse races from the comfort of home, the following primer includes everything you need to know on the subject.

You’ll learn about the history of horse racing law and how it’s been adapted for the internet age, complete with a detailed dive into the various Congressional acts that got us where we are today.

From there, look for the most current listings of the states where online horse betting is banned, and more importantly, the states where you can bet to your heart’s content from any internet-connected device.

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Finally, to point you in the right direction, you’ll find a few of the most reputable online racebooks in the industry – including NASDAQ-listed companies and state-licensed sites.

Intro to the Interstate Horseracing Act of 1978

Long before the issue of internet gambling could be envisioned, lawmakers on Capitol Hill were confronted with a precursor to the concept – interstate off-track betting.

Up until 1970, Nevada was the only state to allow off-track betting, which occurs when bettors in one location wager on races taking place at a separate track. Television streams broadcast live footage of faraway races, enabling audiences in an off-track betting facility to bet and sweat the action without ever stepping foot inside the racetrack.

That all changed when New York moved to legalize off-track betting parlors in 1970, creating a big business in the Empire State by connecting residents to racetracks all over the country.

Soon enough, hundreds of off-track betting parlors – commonly known as OTBs in the industry – were sprouting up throughout New York City and the upstate area.

Before the dawn of the internet age, interstate off-track betting was the next best thing to an online racebook. Sure, you had to hoof it down to the nearest OTB parlor, but once you were there, you could wager on the morning race at Pimlico in Maryland, the noon event at Dover Downs in Delaware, and the nightcap from Monmouth Park in neighboring New Jersey.

Eventually, though, the local operators began to cry foul, claiming that interstate wagering siphoned money away from their racetracks and into the coffers of off-track betting facilities.

To address the increasingly rancorous debate, Congress stepped in by passing the Interstate Horseracing Act of 1978. This law aimed to clarify how proceeds generated from OTB wagers would be divided, and more importantly, whether or not individual states were obligated to allow interstate betting in the first place.

The Interstate Horseracing Act – which falls under Title 15’s regulation of trade and commerce within the United States Code – offers the following justification for Congressional oversight:

(1) the States should have the primary responsibility for determining what forms of gambling may legally take place within their borders;
(2) the Federal Government should prevent interference by one State with the gambling policies of another, and should act to protect identifiable national interests; and
(3) in the limited area of interstate off-track wagering on horse races, there is a need for Federal action to ensure States will continue to cooperate with one another in the acceptance of legal interstate wagers.

As the passage above makes clear, the Act was introduced to prevent one state from “interfering” with the gambling policies of another. In other words, when a state like New York opts to allow interstate off-track betting, other states do not necessarily have to allow New Yorkers to wager on local races.

Crucially, the Act also provided a concrete definition for what the term “interstate off-track bet” really means:

(3) ‘Interstate off-track wager’ means a wager placed or accepted in one State with respect to the outcome of a horserace taking place in another state.

At the time, with the internet still nothing but a twinkle in Al Gore’s eye, the Act and its definition was enough to regulate interstate off-track betting effectively. If two states both allow horse racing, and off-track betting along with it, residents of those states are free to place interstate wagers at licensed facilities – that’s fairly cut and dry.

But as we all know, the digital revolution changed everything in the late 1990s and beyond, connecting people from every state – and worldwide for that matter – along the information superhighway.

Amendment to the Interstate Horse Racing Act Paves the Way for Online Betting

By the year 2000, with the Googles and eBays of the world rapidly transforming how society works, Congress was faced with yet another horse racing debate.

Bettors were logging online to place wagers on horse races everywhere, even in states that didn’t participate in off-track betting. Online racebooks based offshore were able to undercut their regulated competitors, offering rebates on losses to keep regular bettors coming back for more.

At the time, a federal law known as the Interstate Wire Act of 1961 still held sway over gambling activities. Under the Wire Act, bettors and bookmakers were prohibited from conducting business over the telephone, as this allowed for interstate wagering. Given the use of dial-up internet connections at the turn of the century, most legal scholars and lawmakers alike viewed the Wire Act as being applicable to online wagering as well.

But with racetracks and off-track betting parlors rapidly losing financial ground to offshore racebooks, Congress sought a remedy by clarifying the Interstate Horseracing Act of 1978.

In 2000, a short but powerful amendment (passage bolded below) was added to the Act’s definition of “interstate off-track betting,” expanding the activity to include pari-mutuel wagers placed via the internet:

(3) ‘Interstate off-track wager’ means a legal wager placed or accepted in one State with respect to the outcome of a horserace taking place in another State and includes pari-mutuel wagers, where lawful in each State involved, placed or transmitted by an individual in one State via telephone or other electronic media and accepted by an off-track betting system in the same or another State, as well as the combination of any pari-mutuel wagering pools.

And while the typically opaque legal language used doesn’t specifically mention “the internet” or “online” – opting for the vague “electronic media” instead – then Congressman Frank R. Wolf (R-VA) clarified the amendment’s intent. Wolf was a vocal critic of internet gambling during his tenure in Congress, and before the amendment (known as Section 629) was officially ratified, he warned colleagues that they were significantly expanding Americans’ right to wager on horseracing while online:

I want Members of this body to be aware that section 629 of the conference report would legalize interstate pari-mutual gambling over the Internet.
Under the current interpretation of the Interstate Horse Racing Act in 1978, this type of gambling is illegal, although the Justice Department has not taken steps to enforce it.
This provision would codify legality of placing wages over the telephone or other electronic media like the Internet.

Wolf’s opposition wasn’t enough to sink the amendment, however, and it was officially added to the Interstate Horseracing Act that year.

From that point forward, there has been no doubt that playing the ponies over the internet is completely legal within the United States – provided the individual state already allows interstate off-track betting.

How the UIEGA Exemption Helped to Keep Online Horse Betting Legal

Between 2000 and 2006, internet gambling transitioned from an emerging concept into a multibillion-dollar industry.

Chris Moneymaker parlayed a PokerStars qualifier into $2.5 million at the 2003 World Series of Poker (WSOP) Main Event, while online sportsbooks like Bodog were rapidly expanding their reach to compete with Las Vegas’ legal action. And for millions of players from coast to coast, online casinos offered a quick and easy alternative to making that annual sojourn to The Strip.

By 2006, with massive amounts of money flowing from American wallets to offshore online gambling operations, Congress was compelled to act once more. With the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006, federal lawmakers officially criminalized the operation of online casinos, poker rooms, and sportsbooks. Actually placing bets wasn’t a crime, but accepting those bets was now illegal – a move which forced reputable operators like PartyPoker to withdraw from the American market altogether.

Fortunately for the online horseracing industry, however, the prodding of lobbyists combined with a few sympathetic legislators representing racetrack-dense districts combined to create a carveout in the UIGEA.

The following passage from the UIGEA specifically exempts horseracing from the Act’s prohibition of online gambling:

(D) INTERSTATE HORSERACING. – ”(i) IN GENERAL. – The term ‘unlawful Internet gambling’ shall not include any activity that is allowed under the Interstate Horseracing Act of 1978 (15 U.S.C. 3001 et seq.).

To strengthen that passage, Congress included a separate entry outlining the body’s “sense” on how online horse racing should be treated separately than other forms of gambling:

(iii) SENSE OF CONGRESS. – It is the sense of Congress that this subchapter shall not change which activities related to horse racing may or may not be allowed under Federal law.
This subparagraph is intended to address concerns that this subchapter could have the effect of changing the existing relationship between the Interstate Horseracing Act and other Federal statutes in effect on the date of the enactment of this subchapter. This subchapter is not intended to change that relationship.

Thus, while online poker players, sports bettors, and casino game enthusiasts saw their favorite pastime criminalized by the UIGEA, online horse bettors were in the clear.

On a final note regarding the UIGEA, the following passage does clarify that the exemption only applies to states where horseracing and interstate off-track betting is already legal:

(ii) RULE OF CONSTRUCTION REGARDING PREEMPTION.— Nothing in this subchapter may be construed to preempt any State law prohibiting gambling.

In other words, states that don’t allow interstate wagering on horse races aren’t compelled to offer online wagering based on the UIGEA’s exemption.

Even so, with the horseracing industry already well-established throughout much of the country, American bettors now have plenty of options to choose from when it comes to online wagering.

States Where Online Horse Betting Is Banned

Before we dive into the dozens of states where you can bet horses legally online, let’s get the 11 states (plus the nation’s capital) where the industry is illegal out of the way:

  • Alaska
  • Georgia
  • Hawaii
  • Mississippi
  • Missouri
  • Nebraska
  • Nevada
  • North Carolina
  • South Carolina
  • Texas
  • Utah
  • Washington D.C.

These states may seem like an eclectic bunch with little in common, but you can find a few themes uniting them.

In 1959 – when Alaska and Hawaii became the 49th and 50th states, respectively, admitted to the Union – the ethical questions surrounding horse and dog racing at the time made the industry a non-starter during the statehood debate.

Utah’s longstanding influence by the Mormon Church has made the state a no-go zone for any sort of gambling, while religious conservatism in Southern states like Georgia, Mississippi, and Texas had the same effect.

And of course, Nevada had a monopoly on land-based gambling for several decades, so while interstate off-track betting is permitted, the state’s Gaming Control Board has kept online wagers illegal to shepherd customers to casinos.

States Where Online Horse Betting is Legal

Fortunately, the list of locales where online horse betting is banned is quite short compared to the 39 states where the industry is legal:

  • Alabama
  • Arizona*
  • Arkansas
  • California
  • Colorado
  • Connecticut
  • Delaware
  • Florida
  • Idaho
  • Illinois
  • Indiana
  • Iowa
  • Kansas
  • Kentucky
  • Louisiana
  • Maine
  • Maryland
  • Massachusetts**
  • Michigan
  • Minnesota
  • Montana
  • New Hampshire
  • New Jersey
  • New Mexico***
  • New York
  • North Dakota
  • Ohio
  • Oklahoma****
  • Oregon
  • Pennsylvania*****
  • Rhode Island
  • South Dakota
  • Tennessee
  • Vermont
  • Virginia
  • Washington
  • West Virginia******
  • Wisconsin
  • Wyoming
*Online betting in Arizona is limited to the following cities and racetracks: Albuquerque, Aqueduct, Arapahoe, Arlington, Assiniboia, Australia A, B, C & D, AUS-Melbourne RC, Belmont, Belmont Advance, Belmont Penn Pick 4, Belmont/Santa Anita Double, Belterra Park, Breeders Cup Advanced, Breeders Cup Double, Canterbury, Century Downs (TB), Charles Town, Churchill Downs, Cross Country P4, Del Mar, Delaware, Delta Downs, Dubai, Ellis Park, Emerald, Evangeline Downs, Fair Grounds, Fair Meadows, Fairmount, Ferndale, Finger Lakes, Fort Erie, Fonner Park, Fresno, Gold Cup/Belmont Double, Golden Gate, Gulfstream, Gulfstream West, Hastings, Hawthorne TB Only, Hialeah, Indiana Downs, Japan, Keeneland, Kentucky Derby Advance Wagering, Kentucky Derby Futures, Kentucky Derby Pick 3, Kentucky Downs, Kentucky Oaks Futures, KOR-BNG Busan, KOR-SEO Seoul, Las Piedras, Laurel, Lone Star, Los Alamitos (QH), Los Alamitos (TB), Louisana Downs, Mahoning Valley, Maronas, Monmouth, Monmouth @ Meadowlands, Mountaineer, Northlands TB Only, Oaklawn, Oaks Derby Double, Parx Racing, Penn National, Pimlico, Portland Meadows, Prairie Meadows, Preakness Advance, Preakness Double, Presque Isle, Remington, Retama, Rillito Park, Ruidoso, Sacaramento, Sam Houston, Santa Anita, Saratoga TB, Suffolk Downs, Sunland, Sunray, Tampa Bay, Thistledown, Timonium, True North/Met Double, Turf Paradise, Turfway Park, Will Rogers Downs, Woodbine TB, Zia Park
**Massachusetts is limited to the following racetracks: Grants Pass Downs, Las Piedras URU, Lethbridge, Maronas URU
***New Mexico is open to online wagers everywhere except for the following racetracks: Albuquerque, Ruidoso Downs, Sam Houston, Sunland Park, Sunray Park and Zia Park
****Oklahoma does not allow online wagers at Fair Meadows, Remington Park, Will Rogers Downs
*****Pennsylvania is only open to thoroughbred and harness racing, and the following racetracks are not allowed: Ajax Downs, Albuquerque, Arapahoe, Assiniboia QH Meet, Batavia, California Racing Fairs, Canterbury, Delta Downs QH Meet, Evangeline Downs QH Meet, Fair Grounds QH Meet, Fair Meadows, Fairmount, Hialeah Park, Indiana Downs QH Race Days, Lethbridge, Lone Star QH, Los Alamitos QH, Louisiana Downs QH Meet, Northlands Park QH Meet, Portland Meadows, Prairie Meadows QH Meet, Remington QH Meet, Retama Park, Rillito Park, Ruidoso Downs, Sam Houston QH Meet, Sandy Downs, Sunland Park, Sunray Park, Turf Paradise, Will Rogers QH Meet, or Zia Park
******West Virginia does not allow online wagers at Charles Town or Mountaineer

As you can probably tell by scanning the long list of state-specific restrictions, regulating online horse betting is quite complex. States can legalize or criminalize interstate off-track betting at any time, while individual racetracks can formulate their own property-wide policies.

The result for horse racing enthusiasts is a constantly shifting legal landscape, one where your favorite track can be listed on a major online racebook one day, before vanishing into the ether shortly thereafter.

The Best Legal and Legitimate Online Horse Betting Sites

To help you keep track of the continually adapting industry, the best resources out there are the online racebooks that will be accepting your action.

But unlike the murky world of online sports betting, you don’t have to take the added risk of wagering with an unregulated operator.

You’ll find three major online racebooks that specialize in horse betting, and all three are fully licensed and regulated by state governments or on the federal level.

XpressBet:
Operates under a Multi-Jurisdictional Simulcasting and Interactive Wagering Totalizator Hub License issued by the Oregon Racing Commission, allowing the site to serve residents of 38 states. You can learn more about XpressBet by visiting their website here.
TwinSpires:
Is another nationally-facing online racebook based in Lexington, Kentucky. The site is owned and operated by Churchill Downs Incorporated, the company which oversees perhaps the most famous racetrack in all of America. As a NASDAQ-listed company, Churchill Downs Incorporated brings a certain level of legitimacy to TwinSpires. You can check out the TwinSpires website here to get better acquainted with the racebook and its various services.
BetAmerica:
Calls Fargo, North Dakota home, and the site holds a multi-jurisdictional license issued by the North Dakota Racing Commission. This platform is also owned and operated by Churchill Downs Incorporated, so bettors can rest assured that the host venue of the Kentucky Derby is running everything on the up and up. You can take a tour of the BetAmerica website here.

It doesn’t matter which of these online horse betting outlets you choose, as each offers a diverse collection of promotions and bonuses to bring bettors aboard. Each of the three sites listed above provides instant access to more than 400 racetracks, both in the States and around the world, so you’ll never lack for options when the itch to make a play arises.

And with mobile compatibility, this trio expands the action even further, providing endless opportunities to take your wagering with you on the go.

Another way that the regulated online racebooks differentiate themselves from their offshore rivals is accountability. As licensed entities beholden to state and federal law, sites like XpressBet, TwinSpires, and BetAmerica simply can’t afford to play things loose and fast when it comes to the rules.

As a result, every customer service inquiry is answered courteously and promptly, tech issues are subject to rigorous troubleshooting, and all aspects of the betting experience are customized to serve you more efficiently. Throw in a generous slate of Welcome Bonus offers, reload deposit matches, free bets, and other promotions, and unregulated sites just can’t compete with legal online horse racing.

Conclusion

It’s been a long road to get from New York’s first off-track betting parlors in 1970 to online racebooks in 2018. And thankfully, that road led to legalization rather than prohibition. Accordingly, horse racing enthusiasts enjoy an enviable position among American gamblers. While poker players, slot machine aficionados, and sports betting fanatics are forced to deal with unregulated operators, playing the ponies online has never been safer or more secure.