Bill Text: CA AB1347 | 2013-2014 | Regular Session | Amended
Bill Title: Horse racing: out-of-state thoroughbred races.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Engrossed - Dead) 2013-09-11 - Withdrawn from committee. Ordered to inactive file at the request of Senator Emmerson. [AB1347 Detail]
Download: California-2013-AB1347-Amended.html
BILL NUMBER: AB 1347 AMENDED
BILL TEXT
AMENDED IN SENATE SEPTEMBER 6, 2013
AMENDED IN ASSEMBLY MAY 24, 2013
AMENDED IN ASSEMBLY APRIL 16, 2013
INTRODUCED BY Assembly Member Gray
FEBRUARY 22, 2013
An act to amend Section Sections
19596.2 and 19604 of the Business and Professions Code,
relating to horse racing.
LEGISLATIVE COUNSEL'S DIGEST
AB 1347, as amended, Gray. Horse racing: out-of-state thoroughbred
races.
Existing law authorizes a thoroughbred racing association or fair
to distribute the audiovisual signal and accept wagers on the results
of out-of-state thoroughbred races conducted in the United States
during the calendar period the association or fair is conducting a
race meeting, including days on which there is no live racing being
conducted by the association or fair, without the consent of the
organization that represents horsemen and horsewomen participating in
the race meeting and without regard to the amount of purses. Under
existing law, the total number of thoroughbred races imported by
associations or fairs on a statewide basis under these provisions
shall may not exceed 50 per day on days
when live thoroughbred or fair racing is being conducted in the
state, with the exception of prescribed races, including races
imported that are part of the race card of the Kentucky Derby, the
Kentucky Oaks, the Preakness Stakes, the Belmont Stakes, the Jockey
Club Gold Cup, the Travers Stakes, the Arlington Million, the
Breeders' Cup, the Dubai Cup, the Arkansas Derby, or the Haskell
Invitational.
This bill would also exempt from the 50 race per day limitation,
races imported that are part of the race card of the Wood Memorial.
Existing law authorizes advance deposit wagering to be conducted,
with the approval of the California Horse Racing Board, in accordance
with specified provisions of law. Existing law requires a certain
percentage of wagers on out-of-state and out-of-country thoroughbred
races conducted after 6 p.m., Pacific time, together with the total
amount remaining from advance deposit wagering originating from
California out-of-state and out-of-country harness and quarter horse
races conducted at that time, to be distributed as commissions, as
specified, based on the amount handled in state on each breed's own
live races in the previous year by that association or its
predecessor association.
This bill would instead require the amount to be based on the
amount handled in state on each association's live races in the
previous year by that association or its predecessor association. The
bill would make other nonsubstantive changes.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 19596.2 of the Business and Professions Code is
amended to read:
19596.2. (a) Notwithstanding any other law and except as provided
in Section 19596.4, a thoroughbred racing association or fair may
distribute the audiovisual signal and accept wagers on the results of
out-of-state thoroughbred races conducted in the United States
during the calendar period the association or fair is conducting a
race meeting, including days on which there is no live racing being
conducted by the association or fair, without the consent of the
organization that represents horsemen and horsewomen participating in
the race meeting and without regard to the amount of purses.
Further, the total number of thoroughbred races imported by
associations or fairs on a statewide basis under this section shall
not exceed 50 per day on days when live thoroughbred or fair racing
is being conducted in the state. The limitation of 50 imported races
per day does not apply to any of the following:
(1) Races imported for wagering purposes pursuant to subdivision
(c).
(2) Races imported that are part of the race card of the Wood
Memorial, the Kentucky Derby, the Kentucky Oaks, the Preakness
Stakes, the Belmont Stakes, the Jockey Club Gold Cup, the Travers
Stakes, the Arlington Million, the Breeders' Cup, the Dubai Cup, the
Arkansas Derby, or the Haskell Invitational.
(3) Races imported into the northern zone when there is no live
thoroughbred or fair racing being conducted in the northern zone.
(4) Races imported into the combined central and southern zones
when there is no live thoroughbred or fair racing being conducted in
the combined central and southern zones.
(b) Any thoroughbred association or fair accepting wagers pursuant
to subdivision (a) shall conduct the wagering in accordance with the
applicable provisions of Sections 19601, 19616, 19616.1, and
19616.2.
(c) No thoroughbred association or fair may accept wagers pursuant
to this section on out-of-state races commencing after 7 p.m.,
Pacific standard time, without the consent of the harness or quarter
horse racing association that is then conducting a live racing
meeting in the Counties of Orange or Sacramento.
SEC. 2. Section 19604 of the Business
and Professions Code is amended to read:
19604. The board may authorize any racing association, racing
fair, betting system, or multijurisdictional wagering hub to conduct
advance deposit wagering in accordance with this section. Racing
associations, racing fairs, and their respective horsemen's
organizations may form a partnership, joint venture, or any other
affiliation in order to further the purposes of this section.
(a) As used in this section, the following definitions apply:
(1) "Advance deposit wagering" (ADW) means a form of parimutuel
wagering in which a person residing within California or outside of
this state establishes an account with an ADW provider, and
subsequently issues wagering instructions concerning the funds in
this account, thereby authorizing the ADW provider holding the
account to place wagers on the account owner's behalf.
(2) "ADW provider" means a licensee, betting system, or
multijurisdictional wagering hub, located within California or
outside this state, that is authorized to conduct advance deposit
wagering pursuant to this section.
(3) "Betting system" means a business conducted exclusively in
this state that facilitates parimutuel wagering on races it
simulcasts and other races it offers in its wagering menu.
(4) "Breed of racing" means as follows:
(A) With respect to associations and fairs licensed by the board
to conduct thoroughbred, fair, or mixed breed race meetings, "breed
of racing" shall mean thoroughbred.
(B) With respect to associations licensed by the board to conduct
quarter horse race meetings, "breed of racing" shall mean quarter
horse.
(C) With respect to associations and fairs licensed by the board
to conduct standardbred race meetings, "breed of racing" shall mean
standardbred.
(5) "Contractual compensation" means the amount paid to an ADW
provider from advance deposit wagers originating in this state.
Contractual compensation includes, but is not limited to, hub fee
payments, and may include host fee payments, if any, for out-of-state
and out-of-country races. Contractual compensation is subject to the
following requirements:
(A) Excluding contractual compensation for host fee payments,
contractual compensation shall not exceed 6.5 percent of the amount
wagered.
(B) The host fee payments included within contractual compensation
shall not exceed 3.5 percent of the amount wagered. Notwithstanding
this provision, the host fee payment with respect to wagers on the
Kentucky Derby, Preakness Stakes, Belmont Stakes, and selected
Breeders' Cup Championship races may be negotiated by the ADW
provider, the racing associations accepting wagers on those races
pursuant to Section 19596.2, and the horsemen's organization.
(C) In order to ensure fair and consistent market access fee
distributions to associations, fairs, horsemen, and breeders, for
each breed of racing, the percentage of wagers paid as contractual
compensation to an ADW provider pursuant to the terms of a hub
agreement with a racing association or fair when that racing
association or fair is conducting live racing shall be the same as
the percentage of wagers paid as contractual compensation to that ADW
provider when that racing association or fair is not conducting live
racing.
(6) "Horsemen's organization" means, with respect to a particular
racing meeting, the organization recognized by the board as
responsible for negotiating purse agreements on behalf of horsemen
participating in that racing meeting.
(7) "Hub agreement" means a written agreement providing for
contractual compensation paid with respect to advance deposit wagers
placed by California residents on a particular breed of racing
conducted outside of California. In the event a hub agreement exceeds
a term of two years, then an ADW provider, one or more racing
associations or fairs that together conduct no fewer than five weeks
of live racing for the breed covered by the hub agreement, and the
horsemen's organization responsible for negotiating purse agreements
for the breed covered by the hub agreement shall be signatories to
the hub agreement. A hub agreement is required for an ADW provider to
receive contractual compensation for races conducted outside of
California.
(8) "Hub agreement arbitration" means an arbitration proceeding
pursuant to which the disputed provisions of the hub agreement
pertaining to the hub or host fees from wagers on races conducted
outside of California provided pursuant to paragraph (2) of
subdivision (b) are determined in accordance with the provisions of
this paragraph. If a hub agreement arbitration is requested, all of
the following shall apply:
(A) The ADW provider shall be permitted to accept advance deposit
wagers from California residents.
(B) The contractual compensation received by the ADW provider
shall be the contractual compensation specified in the hub agreement
that is the subject of the hub agreement arbitration.
(C) The difference between the contractual compensation specified
in subparagraph (B) and the contractual compensation determined to be
payable at the conclusion of the hub agreement arbitration shall be
calculated and paid within 15 days following the arbitrator's
decision and order. The hub agreement arbitration shall be held as
promptly as possible, but in no event more than 60 days following the
demand for that arbitration. The arbitrator shall issue a decision
no later than 15 days following the conclusion of the arbitration. A
single arbitrator jointly selected by the ADW provider and the party
requesting a hub agreement arbitration shall conduct the hub
agreement arbitration. However, if the parties cannot agree on the
arbitrator within seven days of issuance of the written demand for
arbitration, then the arbitrator shall be selected pursuant to the
Streamlined Arbitration Rules and Procedures of the Judicial
Arbitration and Mediation Services, or pursuant to the applicable
rules of its successor organization. In making the hub agreement
arbitration determination, the arbitrator shall be required to choose
between the contractual compensation of the hub agreement agreed to
by the ADW provider or whatever different terms for the hub agreement
were proposed by the party requesting the hub agreement arbitration.
The arbitrator shall not be permitted to impose new, different, or
compromised terms to the hub agreement. The arbitrator's decision
shall be final and binding on the parties. If an arbitration is
requested, either party may bring an action in state court to compel
a party to go into arbitration or to enforce the decision of the
arbitrator. The cost of the hub agreement arbitration, including the
cost of the arbitrator, shall be borne in equal shares by the parties
to the hub agreement and the party or parties requesting a hub
agreement arbitration. The hub agreement arbitration shall be
administered by the Judicial Arbitration and Mediation Services
pursuant to its Streamlined Arbitration Rules and Procedures or its
successor organization.
(9) "Incentive awards" means those payments provided for in
Sections 19617.2, 19617.7, 19617.8, 19617.9, and 19619. The amount
determined to be payable for incentive awards under this section
shall be payable to the applicable official registering agency and
thereafter distributed as provided in this chapter.
(10) "Licensee" means any racing association or fair licensed to
conduct a live racing meet in this state, or affiliation thereof,
authorized under this section.
(11) "Market access fee" means the amount of advance deposit
wagering handle remaining after the payment of winning wagers, and
after the payment of contractual compensation, if any, to an ADW
provider. Market access fees shall be distributed in accordance with
subdivision (f).
(12) "Multijurisdictional wagering hub" means a business conducted
in more than one jurisdiction that facilitates parimutuel wagering
on races it simulcasts and other races it offers in its wagering
menu.
(13) "Racing fair" means a fair authorized by the board to conduct
live racing.
(14) "Zone" means the zone of the state, as defined in Section
19530.5, except as modified by the provisions of subdivision (f) of
Section 19601. For these purposes, the central and southern zones
shall together be considered one zone.
(b) Wagers shall be accepted according to the procedures set forth
in this subdivision.
(1) No ADW provider shall accept wagers or wagering instructions
on races conducted in California from a resident of California unless
all of the following conditions are met:
(A) The ADW provider is licensed by the board.
(B) A written agreement allowing those wagers exists with the
racing association or fair conducting the races on which the wagers
are made.
(C) The agreement referenced in subparagraph (B) shall have been
approved in writing by the horsemen's organization responsible for
negotiating purse agreements for the breed on which the wagers are
made in accordance with the Interstate Horseracing Act (15 U.S.C.
Sec. 3001 et seq.), regardless of the location of the ADW provider,
whether in California or otherwise, including, without limitation,
any and all requirements contained therein with respect to written
consents and required written agreements of horsemen's groups to the
terms and conditions of the acceptance of those wagers and any
arrangements as to the exclusivity between the host racing
association or fair and the ADW provider. For purposes of this
subdivision, the substantive provisions of the Interstate Horseracing
Act shall be taken into account without regard to whether, by its
own terms, that act is applicable to advance deposit wagering on
races conducted in California accepted from residents of California.
(2) No ADW provider shall accept wagers or wagering instructions
on races conducted outside of California from a resident of
California unless all of the following conditions are met:
(A) The ADW provider is licensed by the board.
(B) There is a hub agreement between the ADW provider and one or
both of (i) one or more racing associations or fairs that together
conduct no fewer than five weeks of live racing on the breed on which
wagering is conducted during the calendar year during which the
wager is placed, and (ii) the horsemen's organization responsible for
negotiating purse agreements for the breed on which wagering is
conducted.
(C) If the parties referenced in clauses (i) and (ii) of
subparagraph (B) are both signatories to the hub agreement, then no
party shall have the right to request a hub agreement arbitration.
(D) If only the party or parties referenced in clause (i) of
subparagraph (B) is a signatory to the hub agreement, then the
signatories to the hub agreement shall, within five days of execution
of the hub agreement, provide a copy of the hub agreement to the
horsemen's organization responsible for negotiating purse agreements
for the breed on which wagering is conducted for each race conducted
outside of California on which California residents may place advance
deposit wagers. Prior to Before
receipt of the hub agreement, the horsemen's organization shall sign
a nondisclosure agreement with the ADW provider agreeing to hold
confidential all terms of the hub agreement. If the horsemen's
organization wants to request a hub agreement arbitration, it shall
send written notice of its election to the signatories to the hub
agreement within 10 days after receipt of the copy of the hub
agreement, and shall provide its alternate proposal to the hub and
host fees specified in the hub agreement with that written notice. If
the horsemen's organization does not provide that written notice
within the 10-day period, then no party shall have the right to
request a hub agreement arbitration. If the horsemen's organization
does provide that written notice within the 10-day period, then the
ADW provider shall have 10 days to elect in writing to do one of the
following:
(i) Abandon the hub agreement.
(ii) Accept the alternate proposal submitted by the horsemen's
organization.
(iii) Proceed with a hub agreement arbitration.
(E) If only the party referenced in clause (ii) of subparagraph
(B) is a signatory to the hub agreement, then the signatories to the
hub agreement shall, within five days of execution of the hub
agreement, provide written notice of the host and hub fees applicable
pursuant to the hub agreement for each race conducted outside of
California on which California residents may place advance deposit
wagers, which notice shall be provided to all racing associations and
fairs conducting live racing of the same breed covered by the hub
agreement. If any racing association or fair wants to request a hub
agreement arbitration, it shall send written notice of its election
to the signatories to the hub agreement within 10 days after receipt
of the notice of host and hub fees. It shall also provide its
alternate proposal to the hub and host fees specified in the hub
agreement with the notice of its election. If more than one racing
association or fair provides notice of their request for hub
agreement arbitration, those racing associations or fairs, or both,
shall have a period of five days to jointly agree upon which of their
alternate proposals shall be the official proposal for purposes of
the hub agreement arbitration. If one or more racing associations or
fairs that together conduct no fewer than five weeks of live racing
on the breed on which wagering is conducted during the calendar year
during which the wager is placed does not provide written notice of
their election to arbitrate within the 10-day period, then no party
shall have the right to request a hub agreement arbitration. If a
valid hub agreement arbitration request is made, then the ADW
provider shall have 10 days to elect in writing to do one of the
following:
(i) Abandon the hub agreement.
(ii) Accept the alternate proposal submitted by the racing
associations or fairs.
(iii) Proceed with a hub agreement arbitration.
The results of any hub agreement arbitration elected pursuant to
this subdivision shall be binding on all other associations and fairs
conducting live racing on that breed.
(F) The acceptance thereof is in compliance with the provisions of
the Interstate Horseracing Act (15 U.S.C. Sec. 3001 et seq.),
regardless of the location of the ADW provider, whether in California
or otherwise, including, without limitation, any and all
requirements contained therein with respect to written consents and
required written agreements of horsemen's groups to the terms and
conditions of the acceptance of the wagers and any arrangements as to
the exclusivity between the host racing association or fair and the
ADW provider.
(c) An advance deposit wager may be made only by the ADW provider
holding the account pursuant to wagering instructions issued by the
owner of the funds communicated by telephone call or through other
electronic media. The ADW provider shall ensure the identification of
the account's owner by using methods and technologies approved by
the board. Any ADW provider that accepts wagering instructions
concerning races conducted in California, or accepts wagering
instructions originating in California, shall provide a full
accounting and verification of the source of the wagers thereby made,
including the postal ZIP Code and breed of the source of the wagers,
in the form of a daily download of parimutuel data to a database
designated by the board. The daily download shall be delivered in a
timely basis using file formats specified by the database designated
by the board, and shall include any and all data necessary to
calculate and distribute moneys according to the rules and
regulations governing California parimutuel wagering. Any and all
reasonable costs associated with the creation, provision, and
transfer of this data shall be borne by the ADW provider.
(d) (1) (A) The board shall develop and adopt rules to license and
regulate all phases of operation of advance deposit wagering for ADW
providers operating in California, including advance deposit
wagering activity that takes place within a minisatellite wagering
facility. The board may recover any costs associated with the
licensing or regulation of advance deposit wagering activities in a
minisatellite wagering facility either directly from the ADW provider
or through an appropriate increase in the funding formula devised by
the board pursuant to paragraph (1) of subdivision (a) of Section
19616.51.
(B) The board shall not approve an application for an original or
renewal license as an ADW provider unless the entity, if requested in
writing by a bona fide labor organization no later than 90 days
prior to before licensing, has entered
into a contractual agreement with that labor organization that
provides all of the following:
(i) The labor organization has historically represented employees
who accept or process any form of wagering at the nearest horse
racing meeting located in California.
(ii) The agreement establishes the method by which the ADW
provider will agree to recognize and bargain in good faith with a
labor organization which that has
demonstrated majority status by submitting authorization cards signed
by those employees who accept or process any form of wagering for
which a California ADW license is required.
(iii) The agreement requires the ADW provider to maintain its
neutrality concerning the choice of those employees who accept or
process any form of wagering for which a California ADW license is
required whether or not to authorize the labor organization to
represent them with regard to wages, hours, and other terms and
conditions of employment.
(iv) The agreement applies to those classifications of employees
who accept or process wagers for which a California ADW license is
required whether the facility is located within or outside of
California.
(C) (i) The agreement required by subparagraph (B) shall not be
conditioned by either party upon the other party agreeing to matters
outside the requirements of subparagraph (B).
(ii) The requirement in subparagraph (B) shall not apply to an ADW
provider which that has entered into a
collective bargaining agreement with a bona fide labor organization
that is the exclusive bargaining representative of employees who
accept or process parimutuel wagers on races for which an ADW license
is required whether the facility is located within or outside of
California.
(D) Permanent state or county employees and nonprofit
organizations that have historically performed certain services at
county, state, or district fairs may continue to provide those
services.
(E) Parimutuel clerks employed by racing associations or fairs or
employees of ADW providers who accept or process any form of wagers
who are laid off due to lack of work shall have preferential hiring
rights for new positions with their employer in occupations whose
duties include accepting or processing any form of wagers, or the
operation, repair, service, or maintenance of equipment that accepts
or processes any form of wagering at a racetrack, satellite wagering
facility, or ADW provider licensed by the board. The preferential
hiring rights established by this subdivision shall be conditioned
upon the employee meeting the minimum qualification requirements of
the new job.
(2) The board shall develop and adopt rules and regulations
requiring ADW providers to establish security access policies and
safeguards, including, but not limited to, the following:
(A) The ADW provider shall use board-approved methods to perform
location and age verification confirmation with respect to persons
establishing an advance deposit wagering account.
(B) The ADW provider shall use personal identification numbers
(PINs) or other technologies to assure that only the accountholder
has access to the advance deposit wagering account.
(C) The ADW provider shall provide for withdrawals from the
wagering account only by means of a check made payable to the
accountholder and sent to the address of the accountholder or by
means of an electronic transfer to an account held by the verified
accountholder or the accountholder may withdraw funds from the
wagering account at a facility approved by the board by presenting
verifiable account identification information.
(D) The ADW provider shall allow the board access to its premises
to visit, investigate, audit, and place expert accountants and other
persons it deems necessary for the purpose of ensuring that its rules
and regulations concerning credit authorization, account access, and
other security provisions are strictly complied with. To ensure that
the amounts retained from the parimutuel handle are distributed
under law, rules, or agreements, any ADW provider that accepts
wagering instructions concerning races conducted in California or
accepts wagering instructions originating in California shall provide
an independent "agreed-upon procedures" audit for each California
racing meeting, within 60 days of the conclusion of the race meeting.
The auditing firm to be used and the content and scope of the audit,
including host fee obligations, shall be set forth in the applicable
agreement. The ADW provider shall provide the board, horsemen's
organizations, and the host racing association with an annual
parimutuel audit of the financial transactions of the ADW provider
with respect to wagers authorized pursuant to this section, prepared
in accordance with generally accepted auditing standards and the
requirements of the board. Any and all reasonable costs associated
with those audits shall be borne by the ADW provider.
(3) The board shall prohibit advance deposit wagering advertising
that it determines to be deceptive to the public. The board shall
also require, by regulation, that every form of advertising contain a
statement that minors are not allowed to open or have access to
advance deposit wagering accounts.
(e) In order for a licensee, betting system, or
multijurisdictional wagering hub to be approved by the board as an
ADW provider, it shall meet both of the following requirements:
(1) All wagers thereby made shall be included in the appropriate
parimutuel pool under a contractual agreement with the applicable
host track.
(2) The amounts deducted from advance deposit wagers shall be in
accordance with the provisions of this chapter.
(f) After the payment of contractual compensation, the amounts
received as market access fees from advance deposit wagers, which
shall not be considered for purposes of Section 19616.51, shall be
distributed as follows:
(1) An amount equal to 0.0011 multiplied by the amount handled on
advance deposit wagers originating in California for each racing
meeting shall be distributed to the Center for Equine Health to
establish the Kenneth L. Maddy Fund for the benefit of the School of
Veterinary Medicine at the University of California at Davis.
(2) An amount equal to 0.0003 multiplied by the amount handled on
advance deposit wagers originating in California for each racing
meeting shall be distributed to the Public Employment Relations Board
to cover costs associated with audits conducted pursuant to Section
19526 and for the purposes of reimbursing the State Mediation and
Conciliation Service for costs incurred pursuant to this section.
However, if that amount would exceed the costs of the Public
Employment Relations Board, the amount distributed to that board
shall be reduced, and that reduction shall be forwarded to an
organization designated by the racing association or fair described
in subdivision (a) for the purpose of augmenting a compulsive
gambling prevention program specifically addressing that problem.
(3) An amount equal to 0.00165 multiplied by the amount handled on
advance deposit wagers that originate in California for each racing
meeting shall be distributed as follows:
(A) One-half of the amount shall be distributed to supplement the
trainer-administered pension plans for backstretch personnel
established pursuant to Section 19613. Moneys distributed pursuant to
this subparagraph shall supplement, and not supplant, moneys
distributed to that fund pursuant to Section 19613 or any other
provision of law.
(B) One-half of the amount shall be distributed to the welfare
fund established for the benefit of horsemen and backstretch
personnel pursuant to subdivision (b) of Section 19641.
Moneys distributed pursuant to this
subparagraph shall supplement, and not supplant, moneys distributed
to that fund pursuant to Section 19641 or any other
provision of law.
(4) With respect to wagers on each breed of racing that originate
in California, an amount equal to 2 percent of the first two hundred
fifty million dollars ($250,000,000) of handle from all advance
deposit wagers originating from within California annually, an amount
equal to 1.5 percent of the next two hundred fifty million dollars
($250,000,000) of handle from all advance deposit wagers originating
from within California annually, an amount equal to 1 percent of the
next two hundred fifty million dollars ($250,000,000) of handle from
all advance deposit wagers originating from within California
annually, and an amount equal to 0.50 percent of handle from all
advance deposit wagers originating from within California in excess
of seven hundred fifty million dollars ($750,000,000) annually, shall
be distributed as satellite wagering commissions. Satellite wagering
facilities that were not operational in 2001, other than one each in
the Cities of Inglewood and San Mateo, and two additional facilities
each operated by the Alameda County Fair and the Los Angeles County
Fair and their partners and other than existing facilities
which that are relocated, are not eligible for
satellite wagering commission distributions under this section. The
satellite wagering facility commissions calculated in accordance with
this subdivision shall be distributed to each satellite wagering
facility and racing association or fair in the zone in which the
wager originated in the same relative proportions that the satellite
wagering facility or the racing association or fair generated
satellite commissions during the previous calendar year. If there is
a reduction in the satellite wagering commissions pursuant to this
section, the benefits therefrom shall be distributed equitably as
purses and commissions to all associations and racing fairs
generating advance deposit wagers in proportion to the handle
generated by those associations and racing fairs. If a satellite
wagering facility is permanently closed other than for renovation or
remodeling, or if a satellite wagering facility is unwilling or
unable to accept all of the signals that are available to that
facility, the commissions otherwise provided for in this subdivision
that would be payable to that facility shall be proportionately
reduced to take into account the time that satellite wagering is no
longer conducted by that facility, or the payment of those
commissions shall be eliminated entirely if the facility is
permanently closed, and, in either case, the satellite wagering
commissions not paid shall be proportionately redistributed to the
other eligible satellite wagering facilities. For purposes of this
section, the purse funds distributed pursuant to Section 19605.72
shall be considered to be satellite wagering facility commissions
attributable to thoroughbred races at the locations described in that
section.
(5) After the distribution of the amounts set forth in paragraphs
(1) to (4), inclusive, the remaining market access fees from advance
deposit wagers originating in California shall be as follows:
(A) With respect to wagers on each breed of racing, the amount
remaining shall be distributed to the racing association or fair that
is conducting live racing on that breed during the calendar period
in the zone in which the wager originated. That amount shall be
allocated to that racing association or fair as commissions, to
horsemen participating in that racing meeting in the form of purses,
and as incentive awards, in the same relative proportion as they were
generated or earned during the prior calendar year at that racing
association or fair on races conducted or imported by that racing
association or fair after making all deductions required by
applicable law. Notwithstanding any other provision of
law, the distributions with respect to each breed of racing
set forth in this subparagraph may be altered upon the approval of
the board, in accordance with an agreement signed by the respective
associations, fairs, horsemen's organizations, and breeders
organizations receiving those distributions.
(B) If the provisions of Section 19601.2 apply, then the amount
distributed to the applicable racing associations or fairs shall
first be divided between those racing associations or fairs in direct
proportion to the total amount wagered in the applicable zone on the
live races conducted by the respective association or fair.
Notwithstanding this requirement, when the provisions of subdivision
(b) of Section 19607.5 apply to the 2nd District Agricultural
Association in Stockton or the California Exposition and State Fair
in Sacramento, then the total amount distributed to the applicable
racing associations or fairs shall first be divided equally, with 50
percent distributed to applicable fairs and 50 percent distributed to
applicable associations.
(C) Notwithstanding any provisions of this section to the
contrary, with respect to wagers on out-of-state and out-of-country
thoroughbred races conducted after 6 p.m., Pacific time, 50 percent
of the amount remaining shall be distributed as commissions to
thoroughbred associations and racing fairs, as thoroughbred and fair
purses, and as incentive awards in accordance with subparagraph (A),
and the remaining 50 percent, together with the total amount
remaining from advance deposit wagering originating from California
out-of-state and out-of-country harness and quarter horse races
conducted after 6 p.m., Pacific time, shall be distributed as
commissions on a pro rata basis to the applicable licensed quarter
horse association and the applicable licensed harness association,
based upon the amount handled in state, both on- and off-track, on
each breed's own association's live
races in the previous year by that association, or its predecessor
association. One-half of the amount thereby
received by each association shall be retained by that association as
a commission, and the other half of the money received shall be
distributed as purses to the horsemen participating in its current or
next scheduled licensed racing meeting.
(D) Notwithstanding any provisions of this section to the
contrary, with respect to wagers on out-of-state and out-of-country
nonthoroughbred races conducted before 6 p.m., Pacific time, 50
percent of the amount remaining shall be distributed as commissions
as provided in subparagraph (C) for licensed quarter horse and
harness associations, and the remaining 50 percent shall be
distributed as commissions to the applicable thoroughbred
associations or fairs, as thoroughbred and fair purses, and as
incentive awards in accordance with subparagraph (A).
(E) Notwithstanding any provision of this section to the contrary,
the distribution of market access fees pursuant to this subparagraph
may be altered upon the approval of the board, in accordance with an
agreement signed by all parties whose distributions would be
affected.
(g) A racing association, a fair, a satellite wagering facility,
or a minisatellite wagering facility may enter into an agreement with
an ADW provider to accept and facilitate the placement of any wager
from a patron at its facility that a California resident could make
through that ADW provider. Deductions from wagers made pursuant to
the agreement shall be distributed in accordance with the provisions
of this chapter governing wagers placed at that facility, except that
the board may authorize alternative distributions as agreed to by
the ADW provider, the operator of the facility accepting the wager,
the association or fair conducting that breed of racing in the zone
where the wager is placed, and the respective horsemen's
organization.
(h) Any issues concerning the interpretation or application of
this section shall be resolved by the board.
(i) Amounts distributed under this section shall be proportionally
reduced by an amount equal to 0.00295 multiplied by the amount
handled on advance deposit wagers originating in California for each
racing meeting, except for harness racing meetings, provided that the
amount of this reduction shall not exceed two million dollars
($2,000,000). The method used to calculate the reduction in
proportionate share shall be approved by the board. The amount
deducted shall be distributed as follows:
(1) Fifty percent of the money to the board to establish and to
administer jointly with the organization certified as the majority
representative of California-licensed jockeys pursuant to Section
19612.9, a defined contribution retirement plan for
California-licensed jockeys who retired from racing on or after
January 1, 2009.
(2) The remaining 50 percent of the money shall be distributed as
follows:
(A) Seventy percent shall be distributed to supplement the
trainer-administered pension plans for backstretch personnel
established pursuant to Section 19613. Moneys distributed pursuant to
this subparagraph shall supplement, and not supplant, moneys
distributed to that fund pursuant to Section 19613 or any other
provision of law.
(B) Thirty percent shall be distributed to the welfare fund
established for the benefit of horsemen and backstretch personnel
pursuant to subdivision (b) of Section 19641. Moneys distributed
pursuant to this subparagraph shall supplement, and not supplant,
moneys distributed to that fund pursuant to Section 19641 or any
other provision of law.
(j) Amounts distributed under this section shall be proportionally
reduced by an amount equal to 0.00295 multiplied by the amount
handled on advance deposit wagers originating in California for each
harness racing meeting, provided that the amount of this reduction
shall not exceed five hundred thousand dollars ($500,000). The method
used to calculate the reduction in proportionate share shall be
approved by the board. The amount deducted shall be distributed as
follows:
(1) First to the welfare fund established for the benefit of
horsemen and backstretch personnel, pursuant to subdivision (b) of
Section 19641, and administered by the organization representing the
horsemen participating in the race meeting, in the amount requested
by the welfare fund. Moneys distributed pursuant to this paragraph
shall supplement, and not supplant, moneys distributed to that fund
pursuant to Section 19641 or any other provision of
law.
(2) The amount remaining, if any, shall be utilized for the
benefit of the horsemen as specified in a written agreement between
the racing association that conducts the live harness race meeting
and the organization representing the horsemen participating in the
race meeting.
