Twin Spires OTB App Attracts Heat from New Hampshire AG’s Office

Posted on: April 15, 2022, 01:36h. 

Last updated on: April 15, 2022, 02:30h.

The New Hampshire Attorney General’s Office is examining the legality of Churchill Downs Inc.’s Twin Spires app, which offers pari-mutuel horse racing wagers to state residents.

hurchill Downs
Churchill Downs Racetrack in Louisville, Ky. Its iconic twin spires inspired the pari-mutuel betting app that is suddenly causing a stir in New Hampshire. (Image: Churchill Downs Inc.)

That’s after gambling regulator the New Hampshire Lottery Commission (NHLC) expressed concern that the app is unlicensed in the state and alleges it “does not conform to state law.”

It is a gray area of concern for us because all of the gambling in this state happens through us. We license or regulate it. In this case, neither,” NHLC executive director Charlie McIntyre told WMUR9 this week.

The State Attorney General’s Office said it took “potential illegal activities related to gambling in the state very seriously,” and was reviewing the situation.

Churchill Downs says Twin Spires’ off-track betting (OTB) operations in New Hampshire are legal and compliant with the federal Interstate Horse Racing Act, 1978 (IHRA).

DraftKings Monopoly

New Hampshire legalized sports betting in 2019, effectively handing an online monopoly to DraftKings. Twin Spires offers only pari-mutuel betting on horse races, which has always been given an easier ride in America than fixed-odds wagering.

But McIntyre says that taxpayers are losing “hundreds of thousands of dollars annually” because the state is not collecting the revenue it would generate from a licensed fixed-odds sports betting app. McIntyre said he had approached Churchill Downs to find a workaround, unsuccessfully. He did not elaborate.

Churchill Downs has a case when it says it is operating legally under IHRA. The federal law was enacted to legalize and regulate OTBs and interstate horse betting, and protects revenue for racetracks and the states in which they’re located.

What’s IHRA?

While the rise of OTB outlets in the 1970s increased horse betting, it also damaged gate receipts at tracks. IHRA provided a federal framework that ensured legal OTBs would share revenues with the tracks, racehorse owners, and states in which they operated.  To offer bets on its races, all OTBs would have to receive specific approval from any track within 60 miles.

IHRA also said that states “should have the primary responsibility for determining what forms of gambling may legally take place within their borders.”

That means individual states are free to levy tax rates on OTBs as they see fit, or they can ban them outright and opt-out of the interstate horse racing industry altogether.

Since New Hampshire has not enacted any specific laws banning OTBs, it will need to legislate appropriately if it wants to squeeze more money out of the Twin Spires app.