BILL NUMBER: AB 650 AMENDED
BILL TEXT
AMENDED IN SENATE SEPTEMBER 4, 2015
INTRODUCED BY Assembly Member Perea
FEBRUARY 24, 2015
An act to amend Section 19596.2 Sections
19607.2 and 19607.3 of the Business and Professions Code,
relating to horse racing. racing, and
declaring the urgency thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 650, as amended, Perea. Horse racing: out-of-state
thoroughbred races: Blue Grass Stakes. Horse racing:
thoroughbred racing: northern zone: auxiliary offsite stabling,
training, and vanning.
(1) The Horse Racing Law requires, when satellite wagering is
conducted on thoroughbred races at associations or fairs in the
northern zone, that an amount not to exceed 1.25% of the total amount
handled by all of those satellite wagering facilities be deducted
from the funds otherwise allocated for distribution as commissions,
purses, and owners' premiums and instead distributed to an
organization formed and operated by thoroughbred racing associations,
fairs conducting thoroughbred racing, and the organization
representing thoroughbred horsemen, to administer a fund to provide
reimbursement for offsite stabling at California Horse Racing
Board-approved auxiliary training facilities for additional stalls
beyond the number of usable stalls the association or fair is
required to make available and maintain, and for the vanning of
starters from these additional stalls on racing days for thoroughbred
horses.
This bill would increase the amount that is required to be
deducted to an amount not to exceed 2% and would provide that this
amount, if adjusted by the board, may be a different percentage of
the handle for different associations and fairs but only if all the
associations and fairs agree to the differing percentages. The bill
would establish an auxiliary offsite stabling and training facility
and vanning program for thoroughbred races in the northern zone. The
bill would revise and recast the provisions governing the
organization formed and operated to administer the fund to include,
among other things, a 50-50 percentage allocation of specified voting
interests on the board of the organization, the use of funds to pay
the organization's expenses and compensate the provider of a
board-approved auxiliary facility for offsite stabling and training
of thoroughbred horses in the northern zone, and the requirement that
the organization submit its proposed financial and operational plans
for the upcoming calendar year to the board for review no later than
November 1 of the preceding year.
The bill would also require that the funds be used to cover all or
part of the cost of vanning thoroughbred horses in the northern zone
from a board-approved auxiliary offsite stabling and training
facility and would authorize the organization to enter into multiyear
contracts for auxiliary facilities in the northern zone subject to
specified conditions. The bill would authorize the organization to
use the funds to pay back commissions, purses, and owners' premiums
to the extent that the deductions made exceed in any year the amount
of the funds necessary to achieve the objectives of the organization.
The bill would also authorize a thoroughbred racing association or
fair in the northern zone to opt out of the auxiliary offsite
stabling and training facility and vanning program, as specified. The
bill would provide that the board shall reserve the right to
adjudicate any disputes that arise regarding costs, or other matters,
relating to the furnishing of offsite stabling, training, or
vanning, as specified.
(2) By expanding the provisions of the Horse Racing Law, a
violation of which is a crime, the bill would create new crimes and
would thereby impose a state-mandated local program.
(3) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
(4) This bill would declare that it is to take effect immediately
as an urgency statute.
The Horse Racing 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 that law, the total number of thoroughbred races
imported by associations or fairs on a statewide basis under these
provisions are required to 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, the Apple Blossom Handicap, or the Haskell
Invitational.
This bill would exempt from the 50 imported race per day
limitation, races imported that are part of the race card of the Blue
Grass Stakes.
Vote: majority 2/3 . Appropriation:
no. Fiscal committee: no yes .
State-mandated local program: no yes .
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 19607.2 of the
Business and Professions Code is amended to read:
19607.2. Notwithstanding Section 19605.8, when satellite wagering
is conducted on thoroughbred races at associations or fairs in the
northern zone, an amount not to exceed 1.25 2
percent of the total amount handled by all of those satellite
wagering facilities, shall be deducted from the funds otherwise
allocated for distribution as commissions, purses, and owners'
premiums and instead distributed to an organization formed and
operated by thoroughbred racing associations, fairs conducting
thoroughbred racing, and the organization representing thoroughbred
horsemen, with each party having meaningful representation
horsemen and horsewomen, for use pursuant to Section
19607.3. A vote of the organization representing thoroughbred
horsemen and horsewomen shall constitute 50 percent of all voting
interests on the board of the organization, to
administer, pursuant organization formed and operated
to supervision of administer the
board, a fund to provide reimbursement for offsite stabling
at board-approved auxiliary training facilities of
fund. The other 50 percent of all voting interests shall be allocated
among thoroughbred racing associations or
and fairs for additional stalls beyond the number
of usable stalls the association is required to make available and
maintain pursuant to Section 19535, conducting
thoroughbred racing in a manner that provides meaningful
representation on the governing board of the organization for
starter fees thoroughbred racing associations
and for the vanning of starters from these additional
stalls on race days for thoroughbred horses. fairs
conducting thoroughbred racing, except as provided in subdivision (h)
of Section 19607.3.
SEC. 2. Section 19607.3 of the Business
and Professions Code is amended to read:
19607.3. (a) The Notwithstanding Section
19535, the funds distributed to the organization formed
pursuant to Section 19607.2 shall be used to reimburse
racing associations that are operating offsite stabling providing
additional stalls pay the organization's expenses and
compensate the provider of a board-approved auxiliary offsite
facility for stabling, training, and vanning of thoroughbred horses
in the northern zone. The organization administering the auxiliary
offsite stabling and training facility and vanning program
shall submit its proposed financial and operational plans for
the incremental increase in operating costs directly
resulting from providing the stabling. upcoming
calendar year to the board for review no later than November 1 of the
preceding year. Neither the organization administering the
auxiliary offsite stabling and training facility and
vanning program nor any of the entities forming and operating
the organization, except the entity operating the auxiliary
offsite stabling and training facility where the
injury occurred, shall be liable for any injury to any jockey,
exercise person, owner, trainer, or any employee or agent thereof, or
any horse occurring at any auxiliary offsite stabling
and training facility.
(b) The funds shall also be used to reimburse horsemen
for cover all or part of the cost of vanning
starting thoroughbred horses from a
board-approved auxiliary training facility operated by a
racing association or fair offsite stabling and
training facility to the track conducting the racing
meeting. Horsemen may use carriers of their own choice, except that
to start in a thoroughbred race at a thoroughbred or
fair racing meeting in the amount
northern zone. The organization shall determine the extent of
reimbursement to horsemen is limited to the amount
and manner in which compensation will be paid for thoroughbred
horses that the organization determines is generally
charged by carriers for vanning are vanned from
the auxiliary training facility to the track
or the fair conducting the thoroughbred or fair
racing meeting. Neither the organization administering the
auxiliary offsite stabling and training facility and
vanning program nor any of the entities forming and operating the
organization, except the an entity
actually engaged in vanning horses, is liable for any injury
occurring to any individual or horse during vanning from an offsite
stabling and training facility.
(c) The training auxiliary offsite
stabling and training facilities and the amenities
provided for offsite stabling and training purposes shall be
substantially equivalent in character to those provided
during by the thoroughbred racing
meetings of association or fair conducting
the association. racing meeting.
(d) In order to ensure the long-term availability of facilities
for offsite stabling and training, the organization may enter into
multiyear contracts for auxiliary facilities in the northern zone.
The organization shall submit to the board for its approval the
multiyear contracts that it enters into with providers of auxiliary
facilities for offsite stabling and training. Contracts not
disapproved by the board within 60 days of submittal to the board
shall be deemed to have been approved by the board.
(e) At the request of the board, the organization shall submit a
report detailing all of its receipts and expenditures over the prior
two fiscal years and, upon request of any party within the
organization, those receipts and expenditures shall be audited by the
board.
(d) Upon the request of any party within the organization, the
board shall adjudicate any dispute regarding costs, or other matters
relating
(f) In addition to the
furnishing uses of offsite stabling or
vanning. The board may, if necessary, appoint an independent auditor
to assist the funds described in the
resolution of disputes. The auditor shall be reimbursed from the
subdivisions (a) and (b), the organization may use the
funds for both of the organization.
following:
(e) The organization may maintain
(1) Maintain a reserve fund of up
to 10 percent of the total estimated annual vanning and
auxiliary offsite stabling and training facili
ty costs. In addition to the reserve fund, if the funds
generated for the auxiliary offsite stabling and
training facilities and vanning are insufficient to fully
reimburse racing associations or fairs for expenses incurred
during cover the offsite vanning and
stabling program, expenses incurred, the
organization may may, in the future,
accumulate sufficient funds to fully reimburse
cover those associations or fairs for those
expenses.
(2) Pay back commissions, purses, and owners' premiums to the
extent the deductions made pursuant to Section 19607.2 exceed in any
year the amount of funds necessary to achieve the objectives of the
organization.
(f)
(g) The amount initially deducted and distributed to
the organization shall be 0.5 percent of the total amount
handled by satellite wagering facilities authorized under this
article in the northern zone on thoroughbred racing, but that
allocation may pursuant to Section 19607.2 may, at the
request of the organization, be adjusted by the board, in its
discretion. However, the adjusted amount may not exceed 1.25
2 percent of the total amount handled by
satellite wagering facilities, facilities.
The amount deducted and distributed to pay expenses
the organization as adjusted by the board may be a
different percentage of the handle for different associations
and maintain fairs conducting thoroughbred
racing meetings in the reserve fund for
northern zone, but only if all the continuing support
of associations and fairs agree to the
program. differing percentages.
(h) A thoroughbred racing association or fair in the northern zone
that is able to provide the minimum number of stalls required by its
racing meeting license without the use of any auxiliary offsite
stabling and training facility and vanning program may opt out of
that program, in which case the deduction described in Section
19607.2 shall not apply during the live racing meeting conducted by
the association or fair until such time as the association or fair
opts back into the auxiliary offsite stabling and training facility
and vanning program. Any thoroughbred racing association or fair in
the northern zone that opts out of the auxiliary offsite stabling and
training facility and vanning program shall not have any voting
interest therein until such time as the association or fair opts back
into the program. The organization shall establish reasonable
procedures and timelines for the giving of notice to the organization
by a thoroughbred racing association or fair that elects to opt out
of the auxiliary offsite stabling and training facility and vanning
program.
(i) The board shall reserve the right to adjudicate any disputes
that arise regarding costs, or other matters, relating to the
furnishing of offsite stabling, training, or vanning. Notwithstanding
any other law, the board shall maintain all powers necessary and
proper to ensure that offsite stabling, training, and vanning, as
provided for in this article, is conducted in a manner that protects
the public and serves the best interests of horse racing.
SEC. 3. No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.
SEC. 4 . This act is an
urgency statute necessary for the immediate preservation of the
public peace, health, or safety within the meaning of Article IV of
the Constitution and shall go into immediate effect. The facts
constituting the necessity are:
At current levels, there are insufficient funds to maintain an
auxiliary offsite stabling and training facility and vanning program
at racing meetings of thoroughbred horses conducted by thoroughbred
racing associations or fairs. Therefore, in order to raise sufficient
funds before the winter thoroughbred horse racing season begins, it
is necessary that this act take effect immediately.
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 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, the Apple
Blossom Handicap, the Blue Grass Stakes, 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 Orange or Sacramento Counties.