FRANKFORT — Besides millions of dollars from operating slot machines, Kentucky's horse tracks could get a substantial cut in their tax bill under the legislation they have proposed.

        Churchill Downs president Alex Waldrop said this week the legislation would repeal the license tax and admission taxes paid by the racetracks to Kentucky's General Fund. Together, those taxes amount to more than $600,000 a year.

        Rep. Jim Callahan, D-Wilder, chief sponsor of the bill, said the loss of tax revenue is minimal when compared to what the state expects to get from the slot machines.

        According to the estimates of the tracks, the state could get $40 million in the first year of operation, $142 million in the second and more than $300 million in following years.

        “It's the only type of revenue you can look at and say each year it's going to get better,” Mr. Callahan said. “And it doesn't cost the taxpayer a penny.”

        Slot machines would also mean more than $500 million in revenue to the tracks each year.

        The license tax is paid by the racetracks based on the average daily amount of money bet at the tracks, called handle. Churchill pays $1,500 for each day it conducts racing, Mr. Waldrop said. Smaller tracks, such as Ellis Park near Henderson, which is owned by Churchill, pays $500 per day.

        Mr. Waldrop said all the tracks paid a total of about $395,000 in 1999.

        The legislation would repeal that tax altogether.

        Racetracks are also charged 15 cents for each patron, whether they pay an admission fee or not. That tax raised about $241,000.

        The proposal contained within the slot machine legislation would impose that tax only on paid admissions to racetracks. And most patrons who visit the slot machine casinos desired by the tracks would not pay for admission.

        When the bill was introduced last week, track officials said it made no changes in the taxes paid by thoroughbred tracks. Mr. Waldrop said this week he had been unfamiliar with that section of the 107-page bill when the initially asked if it cut any taxes for the tracks.

        Mr. Callahan said he was aware the bill eliminated the admission tax on patrons admitted for free but was not familiar with the repeal of the license tax.

        Mr. Callahan said the bill is undergoing some revisions, some of which could be substantial.

        “We're not going to get snookered,” Mr. Callahan said. “They (the tracks) have been very straightforward and up front with us.”

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