The Colorado Limited Gaming Control Commission unanimously approved a rule change Thursday that clears the way for fixed-odds horse wagering to finally be made available to Colorado bettors.

The amended rule eliminates all mention of greyhound racing and initiates a 24-month pilot period to allow stakeholders — namely Arapahoe Park and the state’s horsemen, as well as sports betting operators and content providers — to collect and assess data once wagering begins and determine whether fixed odds are to become a permanent fixture in the Centennial State.

To simply get to this juncture was a longer time coming than many had hoped. The approved pilot period comes as a previous 18-month pilot came to a close. It was expected that the state would have taken and studied the impact of its first fixed-odds wagers by now, but various concerns held by some of the aforementioned stakeholders made consensus-building difficult.

Chief among them was how fixed-odds betting would impact purse money at Arapahoe Park, Colorado’s lone racetrack, as well as whether it would cannibalize parimutuel wagering, where odds can fluctuate right up until the start of a race. But in a letter presented to the commission in advance of Thursday’s meeting, Bally’s, which owns and operates Arapahoe Park, made it clear that it had gotten over such misgivings.

“We believe the ability to offer a fixed-odds horse racing product in Colorado will allow Bally’s and the horse racing industry to capture a new and broader audience, could increase purse sizes, and add to Colorado’s tax revenue stream,” wrote Elizabeth Suever, Bally’s vice president of government relations. “The 24-month trial period will allow regulators, operators, the horse racing industry, and other stakeholders to review data on fixed-odds wagering and establish the viability as a product offering moving forward.

“A fixed-odds horse racing product would also be taxed as a sports wager, at a rate of ten percent, which is significantly higher than a horse racing wager.”

Process took longer than expected

The public comment phase of the meeting included testimony from Michele Fischer of SIS Content Services. She described her employer as “the largest provider globally of fixed odds for horse racing” and shared that SIS had reached an agreement with Arapahoe and its horsemen to distribute fixed-odds content to licensed sportsbooks in Colorado, acknowledging that it “took a little longer than anticipated.”

In explaining the appeal of fixed odds, which mimic those in traditional sports betting, Fischer said she viewed them as a way to attract new bettors to a sport they might not otherwise wager on, thus insinuating that significant cannibalization of parimutuel pools is unlikely.

“Folks that wager on a sportsbook, they just don’t want to bet on parimutuel wagering because the odds change,” she said, noting that fixed-odds horse betting, which has long been commonplace in foreign markets, is viewed as a way to establish a new revenue stream for an industry that is struggling in certain parts of the United States.

As for how long Coloradans may have to wait to take advantage of this new betting option, an industry source told US Bets that early 2024 could be a reasonable timeline for the state to take its first fixed-odds horse wager.

“We have one sportsbook committed from day one and we have several others waiting for this meeting to end so they can put this product into their roadmap to add it,” Fischer said during the meeting (she declined to name the sportsbook). Later, she added, “How quickly each one can do the work will have to be determined by them.”

The only other state where fixed-odds betting is currently available for horse racing is New Jersey.

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