BILL NUMBER: AB 471 CHAPTERED
BILL TEXT
CHAPTER 198
FILED WITH SECRETARY OF STATE AUGUST 13, 2001
APPROVED BY GOVERNOR AUGUST 12, 2001
PASSED THE ASSEMBLY JULY 20, 2001
PASSED THE SENATE JULY 18, 2001
AMENDED IN SENATE JULY 11, 2001
AMENDED IN SENATE JULY 2, 2001
AMENDED IN SENATE JUNE 7, 2001
INTRODUCED BY Assembly Members Hertzberg, Wesson, Aroner, and
Briggs
(Coauthors: Senators Burton and Vincent)
FEBRUARY 21, 2001
An act to amend Sections 19461 and 19481.5 of, to add Sections
19461.5, 19526, 19613.8, and 19641.2 to, to add Article 2.5
(commencing with Section 19455) to Chapter 4 of Division 8 of, to
amend, repeal, and add Sections 19411, 19590, 19595, and 19613 to,
and to add and repeal Section 19601 of, the Business and Professions
Code, relating to horse racing.
LEGISLATIVE COUNSEL'S DIGEST
AB 471, Hertzberg. Horse racing.
(1) Existing law authorizes wagering on the result of live and
simulcast horse races, subject to the regulation and oversight of the
California Horse Racing Board, and requires the licensure of various
persons and entities associated with this industry. Existing law
also imposes specified requirements on the operation of racetracks,
backstretch facilities, and stabling and vanning services, and
establishes pension funds and welfare funds for the benefit of
backstretch personnel and horsemen.
This bill would state findings and declarations of the Legislature
regarding the employment rights of racetrack backstretch employees,
and direct the California Horse Racing Board to oversee the conduct
of a union and multiemployer collective bargaining agent recognition
procedure subject to specified conditions and procedures, provide for
resultant labor agreements to be binding on the parties, and
establish reasonable rules to regulate the time, place, and manner of
representational meetings within the racetrack enclosure. This bill
would also authorize individual trainers to opt out of the
multiemployer bargaining process, subject to specified conditions,
and require each trainer to keep accurate payroll records for all of
his or her employees, subject to audit by the Labor Commissioner as
specified, containing specified information which would be available
for inspection by, or furnished to, the employee, his or her
authorized representative, the board, the administrators of specified
pension and health and welfare funds, or the Division of Labor
Standards Enforcement of the Department of Industrial Relations.
(2) Existing law provides that every license granted under the
Horse Racing Law is subject to suspension or revocation in any case
where the board has reason to believe that any condition regarding
the license has not been complied with, or that any provision of law
or any rule or regulation of the board affecting it has been broken
or violated.
This bill would expand this suspension and revocation authority to
expressly include violations of the Labor Code and regulations
adopted thereunder. This bill would also provide that upon a finding
by the Labor Commissioner that a violation of any provision of the
Labor Code under his or her jurisdiction has been committed by a
person licensed under the Horse Racing Law, that upon expiration of
the applicable period for appeal he or she shall notify the board of
that finding.
(3) Existing law provides that no license to conduct a horse
racing meeting shall be issued unless the track has been inspected
and approved by the board as to specified racetrack safety standards
within 30 days prior to the date of application.
This bill would additionally provide that the board shall, within
120 days of the effective date of this act, adopt emergency
regulations, as specified, to establish employee housing standards at
licensed racetracks, which shall be replaced by final, permanent
regulations with 18 months thereafter, which racing associations
shall be in compliance with by January 1, 2004, and as of that date
would require the board, in conjunction with the Department of
Housing and Community Development or a local housing authority in
that jurisdiction, to annually inspect the living conditions of
backstretch employee housing and submit these findings to the board.
The bill would provide that no license to conduct a horse racing
meeting shall be issued to a racing association unless the board has
inspected the housing conditions that exist on that track's
backstretch and determined them to be in compliance with these
standards.
(4) Existing law permits any racing association in this state,
with the approval of the California Horse Racing Board, to accept
out-of-state wagers on a race or races conducted by or disseminated
by that association and to transmit live audiovisual signals of the
race or races to locations out of state. Existing federal law, the
Federal Interstate Wire Act, generally prohibits the transmission in
interstate commerce of wagers using a wire communication facility,
but allows for the transmission of wagering information as specified.
This bill would state findings and declarations of the Legislature
regarding online wagering and account wagering.
This bill would authorize any racing association or fair to accept
advance deposit wagers, or to allow these wagers through a betting
system or multijurisdictional wagering hub, during the calendar
period of its live racing meeting upon approval by the board, and to
form partnerships, joint ventures, or any other affiliation to
further this purpose. The bill would provide that an advance deposit
wager is a method of making a parimutuel wager in which a person in
California or elsewhere establishes an account with a licensee,
betting system, or multijurisdictional wagering hub, and subsequently
issues wagering instructions concerning the funds in this account,
thereby authorizing the entity holding the account to place wagers on
the account owner's behalf. The bill would provide that wagering
instructions may be communicated by telephone call or through other
electronic media, and that the entity holding the account shall
ensure the identification of the account's owner by utilizing methods
and technologies approved by the board. The bill would require
entities holding advance wagering accounts to provide a full
accounting of deposits and wagers, as specified, and after the
payment of winning wagers and the deduction of contractual
compensation and a host fee, where applicable, to pay the remaining
amount to various racing entities in California, with specified
percentages based on the amount handled on advance deposit wagers
that originate in California for each race meeting to be dedicated to
the Kenneth L. Maddy Fund for equine health, payment of auditing
costs incurred pursuant to (1), reimbursement of the State Mediation
and Conciliation Service for costs incurred pursuant to this act the
augmentation of compulsive gambling prevention programs, and the
augmentation of an existing welfare fund and existing pension plans
benefiting backstretch personnel, with the remaining funds to be
distributed as commissions, purses, and incentive awards, as
specified. The bill would require the board to develop and adopt
rules to regulate and license advance deposit wagering operations,
security, and advertising, and would require that entities conducting
advance deposit wagering conducted in California enter into
contractual agreements with labor organizations, as specified. This
bill would repeal these provision on January 1, 2008.
(5) Existing law defines "parimutuel wagering" as wagering where
bettors purchase tickets, and provides that lawful parimutuel
wagering shall only be conducted within the enclosure of a licensee.
This bill would provide that the term "parimutuel wagering"
includes the issuance of wagering instructions leading to the
placement of wagers, and that wagering instructions concerning funds
held in an advance deposit wagering account shall be deemed to be
issued within the licensee's enclosure, in accordance with (1).
This bill would repeal this provision on January 1, 2008.
(6) Existing law requires each licensed racing association to
designate a certain number of racing days to be conducted as charity
days for the purpose of the distribution of the net proceeds
therefrom to beneficiaries, and requires that at least 20% of the
distributions therefrom to be made to charities associated with the
horse racing industry.
This bill would specify that an existing specified backstretch
employee welfare fund shall be a health and welfare trust fund
administered without prejudice for the benefit of every eligible
person, that the fund and benefits shall be administered in
accordance with specified standards established in federal law,
subject to oversight and regulation of the board, and that the
welfare fund board be expanded, by March 1, 2002, to include 2
additional groom and stable employee licenses, also would be replaced
by designees of a labor union with 60 days of that union having been
chosen as the exclusive collective bargaining agent of a statewide
majority of backstretch workers.
(7) Existing law provides that racing associations and fairs shall
pay, from the portion deducted for purses, an amount equal to 1% of
that portion for a pension plan for backstretch personnel to be
administered by the respective trainers' organizations.
This bill would provide that within 60 days of a union having been
chosen as the exclusive collective bargaining agent for a statewide
majority of backstretch workers these funds shall instead be directed
to a pension plan for backstretch personnel established by a plan
submitted by trainers' organizations as specified which shall be
administered by a committee that shall include 2 representatives
designated by the bargaining agent.
(8) This bill would provide that its provisions are severable as
specified.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 19411 of the Business and Professions Code is
amended to read:
19411. "Parimutuel wagering" is a form of wagering in which
bettors either purchase tickets of various denominations, or issue
wagering instructions leading to the placement of wagers, on the
outcome of one or more horse races. When the outcome of the race or
races has been declared official, the association distributes the
total wagers comprising each pool, less the amounts retained for
purposes specified in this chapter, to winning bettors.
This section shall remain in effect only until 2008, and as of
that date is repealed, unless a later enacted statute, that is
enacted before January 1, 2008, deletes or extends that date.
SEC. 1.5. Section 19411 is added to the Business and Professions
Code, to read:
19411. "Parimutuel wagering" is a form of wagering in which
bettors either purchase tickets of various denominations on the
outcome of one or more horse races. When the outcome of the race or
races has been declared official, the association distributes the
total wagers comprising each pool, less the amounts retained for
purposes specified in this chapter, to winning bettors.
This section shall become operative on January 1, 2008.
SEC. 2. Article 2.5 (commencing with Section 19455) is added to
Chapter 4 of Division 8 of the Business and Professions Code, to
read:
Article 2.5. Backstretch Worker Labor Relations
19455. (a) The Legislature finds and declares that Section 923 of
the Labor Code recognizes that it is necessary that the individual
worker have full freedom of association, self-organization, and
designation of representatives of his or her own choosing, to
negotiate the terms and conditions of his or her employment, and that
he or she shall be free from the interference, restraint, or
coercion of employers of labor, or their agents, in the designation
of such representatives or in self-organization or in other concerted
activities for the purpose of collective bargaining.
(b) The Legislature finds that the National Labor Relations Board
has formally declined to assert jurisdiction over horse racing
because of extensive state control over the industry, the dominant
pattern of sporadic short-term employment which poses problems for
the effective enforcement of the National Labor Relations Act, and a
unique and special relationship that has developed between the states
and the industry.
(c) It is the intent of the Legislature to establish an orderly
procedure for backstretch employees to exercise their statutory
rights to organize a labor union, in order to reduce the prospect of
any strikes, disruptions, or economic action that would interfere
with the operation of horse racing meetings in California.
(d) Except as provided in subdivision (e), the board shall oversee
the conduct of a union recognition procedure for backstretch
employees under the following conditions:
(1) Employees shall have the right to join, or refuse to join, a
labor organization for purposes of collective bargaining and mutual
aid and protection. Existing state-recognized organizations of
trainers or horsemen established pursuant to the Horse Racing Law
shall not use funds derived or distributed from parimutuel wagering
pursuant to state law to advocate or advance any position with
respect to unionization of employees. Individual trainers and
horsemen, and their agents, shall not coerce or threaten any employee
of any trainer or horseman because of the exercise of rights
pursuant to this article. No employee shall be discharged or
discriminated against for expressing any opinion concerning the
selection of a labor union or collective bargaining agent for
employees under this article. No trainer or horseman, or group of
trainers or horsemen, shall dominate or interfere with the formation
or administration of any labor organization established under this
article nor contribute financial or other support to it.
(2) The labor union and its representatives shall not coerce or
threaten any employee of any trainer or horseman because of the
exercise of rights pursuant to this article.
(3) Notwithstanding any other provision of law, within 30 days of
a request by a bona fide labor organization representing workers in
the horse racing industry in California, accompanied by a petition of
125 licensed backstretch workers, the board shall provide the labor
organization with a list of all backstretch workers including the
type of licenses they hold, their employer, the location at which
they are employed, and their address and telephone number. The board
may require of any trainer licensee information in the licensee's
possession necessary to comply with this requirement. The labor
union shall use this list solely for the purposes of this article,
and maintain it in a manner, as the board may require, to preserve
the integrity of horse racing. The board may impose an appropriate
penalty for any other use.
(4) Every licensed trainer who employs backstretch employees shall
file with the board, not later than February 1, 2002, and, within
seven days of the commencement of each race meeting thereafter, a
complete and accurate list of the names of its backstretch workers.
In addition, every trainer shall file with the board a complete,
accurate, and updated list within seven days of any changes which
occur to the most recently filed list. The lists described in this
section, together with any updates thereto, shall be provided within
72 hours after receipt by the board, to any bona fide labor
organization which has requested copies thereof and submitted a
petition containing the names of 125 backstretch workers pursuant to
paragraph (3). Any such request need only be made one time and the
board shall thereafter be required to provide these lists and any
updates thereto in accordance with the provisions of this section so
long as a bona fide labor organization seeks to represent licensed
backstretch workers.
(5) The labor union may obtain board recognition as the exclusive
bargaining agent for employees of employers pursuant to provisions
and procedures described in paragraph (8).
(6) For the purposes of this article:
(A) "Backstretch employee" or "backstretch worker" means a person
licensed by the board pursuant to subdivision (c) of Section 1481 of
Division 4 of Title 4 of the California Code of Regulations.
(B) "Multiemployer bargaining unit" means any bargaining unit
created and recognized pursuant to the terms of clause (iii) of
subparagraph (A) of paragraph (8).
(c) "Approved election unit" means any election unit created and
recognized pursuant to paragraph (7).
(7) There are four election units created and recognized pursuant
to this section, as follows:
(A) Backstretch employees working for trainers of thoroughbred
horses stabled at licensed racetracks, including fairs and approved
auxiliary training facilities in the combined central and southern
zones.
(B) Backstretch employees working for trainers of thoroughbred
horses stabled at licensed racetracks, including fairs and approved
auxiliary training facilities in the northern zone.
(C) Backstretch employees working for trainers of quarter horses
stabled at licensed racetracks and approved auxiliary training
facilities in the combined central and southern zones.
(D) Backstretch employees working for trainers of harness horses
stabled at licensed racetracks, including fairs and approved
auxiliary training facilities in the northern zone.
The board shall use the California State Mediation and
Conciliation Service for all appropriate purposes of this act,
including operations related to the conduct of recognition procedures
and elections.
(8) (A) With respect to backstretch workers, a labor organization
seeking recognition as the collective bargaining agent for these
workers shall collect signed cards indicating individual worker's
intent to be represented by that organization for collective
bargaining purposes and submit those cards to the California State
Mediation and Conciliation Service for review and validation. When
the labor organization is in receipt of cards signed by workers
equaling at least 30 percent of the employees in an election unit
described in paragraph (4), the California State Mediation and
Conciliation Service shall conduct a secret ballot election with
respect to the election unit as soon as is practicable thereafter,
but in no event more than 30 calendar days after validation by the
service of the cards.
Those backstretch employees entitled to vote in the election shall
be those who appear on the licensed trainer's most recent list
described in paragraph (3). However, each employer may update his or
her list not more than 72 hours prior to the election. If it is
determined by the stewards pursuant to the provisions in paragraph
(11), that the employer filed an inaccurate or erroneous list with a
willful intention to manipulate the results of an election, and that
the inaccuracy or error may have affected the outcome of the
election, the stewards shall decree that the employer lost the
election, regardless of the actual outcome thereof, and the stewards
shall issue an order to the trainer to negotiate with the union.
(i) Any election shall be conducted by the California State
Mediation and Conciliation Service under rules established by the
Service consistent with standard practice. The rules shall be
established no more than 60 days after the effective date of this
section, shall be made available to the bona fide labor union and
employers of backstretch employees, and shall be exempt from the
Administrative Procedure Act. The rules shall provide for a secret
ballot system for the conduct of the election pursuant to which
ballots cast by backstretch employees of individual employers shall
be cast by insertion into envelopes appropriately identified with
respect to each employer. The envelopes shall be collected and
tabulated in secret by the service, subject to observation by one
representative designated by the bona fide labor organization and one
representative designated by the organization representing trainers
pursuant to subdivision (a) of Section 19613.2. Upon completion of
the tabulation, the service shall issue a report certifying those
employers, the majority of whose employees who participated in the
election voted in favor of representation by the union. Those
employers so certified shall be required to bargain with the labor
union pursuant to this subdivision. All other employers shall not be
required to negotiate with the union and there shall not be another
election with respect to those employers for at least one year from
the date of the prior election. The service shall not make public
the numerical tabulation of votes by employer.
(ii) Protests over challenged ballots shall be resolved by the
service in a consolidated hearing commencing no later than three
business days after the election.
(iii) Within 45 days of the certification of the results of the
election by the service to the board, those trainers who are required
to bargain pursuant to this subparagraph may form multiple employer
bargaining units in accordance with the provisions of this
subdivision. Further, the organization representing trainers
pursuant to subdivision (a) of Section 19613.2 shall conduct a
meeting regarding the formulation of multiple employer bargaining
units within five days of the certification of the results of the
election. For licensed trainers described in subparagraph (A)
paragraph (7) the minimum number of backstretch employees employed by
licensed trainers comprising the multiple employer bargaining unit
as of the date of the election shall be 100 employees or 10 percent
of the total employees subject to bargaining. For licensed trainers
described in subparagraphs (B), (C), and (D), of paragraph (7), the
minimum number of backstretch employees employed by licensed trainers
comprising the multiple employer bargaining unit as of the date of
the election shall be 50 employees or 10 percent of the total
employees subject to bargaining. The minimum number of backstretch
employees employed by licensed trainers in order to qualify as a
multiple employer bargaining unit pursuant to this subdivision may,
with the consent of the recognized labor union, be reduced. On or
before the 45th day following the certification of the results of the
election, each representative of a multiple employer bargaining unit
formed pursuant to this subdivision shall notify the board and the
exclusive collective bargaining agent, in writing, that a unit has
been formed, disclose the names of the licensed trainers which
comprise the unit, and indicate the number and names of the
backstretch employees which are employed by the licensed trainers
comprising the unit. Except to join another multiple employer
bargaining unit, without the consent of the bona fide labor
organization, a trainer who has elected to join a multiple employer
bargaining unit may not thereafter elect to resign from the unit
except within a 30-day period prior to the date of the expiration of
the collective bargaining agreement resulting from the negotiations.
The employees of a licensed trainer who has resigned from a multiple
employer bargaining unit and has not joined another unit, shall not
be entitled to petition to decertify the union for a period of one
year from the date of the expiration of the collective bargaining
agreement which resulted from the negotiation between the union and
the multiple employer bargaining unit of which he or she was formerly
a member and which was in effect at the time of the trainer's
resignation. Upon completion and certification of the election
results the union shall be recognized as the exclusive collective
bargaining agent for those workers whose employers are required to
bargain, and the executive director of the board shall issue an order
to affected employers to begin good faith negotiations for approval
of employment agreements pursuant to the procedures set forth in this
section.
(B) If an individual employer of backstretch workers declines to
be represented in the multiemployer collective bargaining procedure
described in clause (iii), the board shall issue an order to begin
good faith negotiations for employment agreements on an individual
employer basis. The board may provide mediation and conciliation
services upon request of the parties at any time. If an employer is
required under this subparagraph to collectively bargain with the
union, and the parties do not reach an agreement within 90 days of
the order, the board shall require the parties to participate in
mandatory mediation and conciliation services for a period of 30
days. If no agreement results from this mediation, either or both
parties may declare an impasse. Upon a party's declaration of an
impasse, the Executive Director of the Board shall appoint an
arbitrator in the manner described in paragraph (11) to determine the
issues and issue a final and binding order establishing the terms of
a collective bargaining agreement.
(9) No labor agreement under this article shall apply to any
trainer or horseman with respect to employment associated with fair
meetings prior to January 1, 2003. After this date, employees shall
be added by accretion into an existing contract where applicable.
For racing meetings conducted in the central and southern zones
during the first three months of any calendar year and for fair
racing meetings, this section shall not apply to trainers who
normally reside and work outside of California and who are engaged in
racing in this state for a limited period of time, not exceeding 90
racing days in any calendar year. For all other race meeting
conducted during any calendar year, this section shall not apply to
trainers, backstretch workers, or both who normally reside and work
outside of California and without are engaged in racing in this state
for a limited period of time, not exceeding 50 racing days in any
calendar year.
(10) Except as provided in subparagraph (A) of paragraph (8), at
any time subsequent to the expiration of an agreement under paragraph
(8), when the agreement is not in effect, the board may recognize a
majority interest, obtained during this period in the same manner as
union recognition of employees, within a multiple employer bargaining
unit who no longer desire to be represented by the union, and
withdraw the recognition granted pursuant to this section from that
union. An employer may inform his or her employees that a process
for decertification exists and direct them to the board for
information. However any card, signature, vote, or other indicator
obtained for this purpose by means of coercion or threat or with the
assistance or inducement of any employer shall be invalid.
(11) Disputes, other than disputes concerning the operation and
application of ongoing contracts, disputes subject to binding
interest arbitration pursuant to subparagraph (B) of paragraph (8),
and economic disputes arising in the context of multiemployer
bargaining pursuant to subparagraph (A) of paragraph (8), but
including disputes concerning the rights established in paragraphs
(1) and (2), upon complaint shall be adjudicated the stewards. The
stewards shall have the authority to order any remedy, including
reinstatement of employment, injunctive relief, damages, and attorney'
s fees. The board is authorized to contract with the Agricultural
Labor Relations Board for the services of investigators or counsel to
investigate, make findings of fact, and issue recommendations to the
stewards with respect to disputes and any alleged unfair labor
practices. An investigation and adjudication by the stewards shall
be concluded as expeditiously as possible, consistent with applicable
standards of due process. In addition the board may require the
parties to submit the issue to binding arbitration subject to
judicial review in the same manner as decisions of the board.
Disputes subject to this paragraph include disputes involving any
backstretch employee or group of employees, and any trainer or group
of trainers.
(12) Upon submission of a complaint to binding arbitration under
any provision of this article, the executive director of the board
shall select an arbitrator from a panel of professional arbitrators
with expertise in labor negotiations selected by the California State
Mediation and Conciliation Service or from a panel identified in
collective bargaining agreements between labor organizations and
employers in the horse racing industry in California, who shall hold
a hearing within 72 hours of written notice to all the parties. In
all matters pertaining to the rights established by this article, an
arbitrator shall have the authority to fashion an appropriate remedy,
including reinstatement of employment, injunctive relief, damages,
and attorney's fees, and issuance of a make-whole remedy in the event
of a persistent failure of a party to bargain in good faith. The
board may take any administrative action within its authority to
ensure compliance with decisions of arbitrators authorized by this
section. Either party may also bring an action in state court to
compel a party to go into arbitration or to enforce the decision of
an arbitrator. Costs of arbitration shall be shared equally by the
parties, and any party shall be entitled to recover any reasonable
fees or costs incurred in securing compliance with or enforcement of
an award or order of the arbitrator.
(e) Nothing in this section shall prevent a labor union and an
individual trainer, or any group of trainers, from entering into a
mutually acceptable agreement, which may substitute for the
requirements of subdivision (d), for union organizing of employees of
the horsemen or trainers. Nothing in this article shall be
interpreted to require representative parties in negotiation to
enter into any labor agreement, as long as each party is negotiating
in a good faith effort to reach an agreement.
19455.2. (a) The board shall provide for labor agreements under
this article to be binding upon every applicable licensee.
(b) No horseman or trainer who has a separate agreement with the
exclusive representative labor union shall be required to be a party
to a multiemployer collective bargaining agreement.
19455.4. The board may establish reasonable rules to regulate the
time, place, and manner for representatives of labor unions to meet
backstretch workers within the enclosure during working and
nonworking hours. Those rules shall provide that the union and its
representatives shall not interfere with the work of any employee,
but shall have reasonable access to backstretch employees within the
enclosure during working hours and nonworking hours, as determined by
the board. With the approval of the board, these regulations may be
superseded by collective bargaining agreements between horsemen's
organizations or trainers' organizations and labor organizations.
SEC. 3. Section 19461 of the Business and Professions Code is
amended to read:
19461. Every license granted under this chapter is subject to
suspension or revocation by the board in any case where the board has
reason to believe that any condition regarding it has not been
complied with, or that any law, including the Labor Code and the
regulations adopted thereunder, or any rule or regulation of the
board affecting it has been broken or violated.
All proceedings to revoke a license shall be conducted in
accordance with Chapter 5 of Part 1 of Division 3 of Title 2 of the
Government Code.
SEC. 4. Section 19461.5 is added to the Business and Professions
Code, to read:
19461.5. Upon a finding by the Labor Commissioner that a
violation of any provision of the Labor Code, within the jurisdiction
of the Labor Commissioner, has been committed by a person licensed
pursuant to this chapter in the course of such licensed activity, the
Labor Commissioner shall, upon expiration of the applicable period
for appeal, notify the board of that finding.
SEC. 5. Section 19481.5 of the Business and Professions Code is
amended to read:
19481.5. (a) Notwithstanding any other provision of law, no
license shall be issued to conduct a horse racing meeting upon a
track unless the track has been inspected by the board within 30 days
prior to the date of application for a license and the track has
been approved by the board as conforming to the racetrack safety
standards set forth in subdivision (a) of Section 19481.
(b) The board shall, within 120 days of the effective date of this
subdivision, adopt emergency regulations in accordance with the
Administrative Procedure Act (Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code) to
establish standards governing the employee housing provided to
backstretch personnel at licensed racetracks. These regulations
shall be deemed to be an emergency and necessary for the immediate
preservation of the public peace, health and safety, or general
welfare, shall be commensurate with the housing standards established
in the Employee Housing Act (commencing with Section 17000 of
Division 13 of the Health and Safety Code), and shall consider the
following:
(1) The health and safety of the human and equine population and
the necessity for humans and horses to live in close proximity.
(2) The housing needs of state or county facilities with live
racing meeting of no more than 43 days in duration that do not
operate as year-round training facilities. The board shall
specifically consider the different needs of these facilities
compared to permanent facilities or other state and county facilities
that function on a year-round basis, including state and county fair
facilities that operate as a year-round training facilities where
horses are stabled and workers live.
(3) Compliance of facilities with racing meetings of 19 days or
less, even if they operate as a year-round training facility, with
this subdivision shall be contingent on funding in the 2002-03 Budget
Act.
These emergency regulations shall be submitted to the Office of
Administrative Law for filing with the Secretary of State and
publication in the California Code of Regulations and shall be
replaced by final, permanent regulations within 18 months of their
adoption. Every racing association shall be in compliance with these
housing standards by January 1, 2004.
(c) Commencing January 1, 2004, the board, with assistance from
the California Department of Housing and Community Development or a
local housing authority for the jurisdiction in which the racetrack
is located, shall annually inspect the living conditions of
backstretch employee housing to ensure compliance with the housing
standards established by the board, the findings or results of which
shall be submitted to the board. No license shall be issued to a
racing association to conduct a horse race meeting unless the board
has inspected the housing conditions that exist on the racetrack's
backstretch and determined the living conditions to be in compliance
with the standards established by the board in subdivision (b).
(d) The board may assess a reasonable fee upon racing associations
to defray the costs associated with the inspections provided for in
subdivision (c).
SEC. 6. Section 19526 is added to the Business and Professions
Code, to read:
19526. (a) Each trainer shall keep accurate payroll records,
showing the name, address, social security number, work
classification, straight time and overtime hours worked each day and
week, paid to each of his or her employees.
(b) The payroll records enumerated under subdivision (a) shall be
available for inspection at all reasonable hours at the principal
office of the trainer on the following basis:
(1) A copy of an employee's payroll record shall be made available
for inspection or furnished to the employee or his or her authorized
representative upon request.
(2) A copy of all payroll records enumerated in subdivision (a)
shall be made available for inspection or furnished upon request to
the board and the Division of Labor Standards Enforcement of the
Department of Industrial Relations.
(3) On or before January 31 of each year, each trainer shall
provide copies of federal W-2 and 1099 tax forms for his or her
backstretch employees for the previous calendar year to the
administrator of the pension fund for backstretch employees.
(c) The payroll records described in this section shall be on
forms provided by the Division of Labor Standards Enforcement or
shall contain the same
information as the forms provided by the division.
(d) A trainer shall make the records enumerated in subdivision (a)
available to an employee or his or her authorized representative
within 10 days after receipt of a written request.
(e) The trainer shall inform the board of the location of the
records enumerated under subdivision (a), including the street
address, city and county, and shall, within five working days,
provide a notice of a change of location and address.
(f) In addition to any other penalty imposed by law, any trainer
who fails to provide access to the records enumerated in subdivision
(a) to the board, the employee or his or her authorized
representative, the administrator of the pension or welfare funds, or
to the Division of Labor Standards enforcement as required by law
shall be subject to suspension of his or her license.
(g) Except for trainers covered by an operative collective
bargaining agreement pursuant to Section 19613.7, the board may
require, as a condition of issuing or renewing a trainer's license,
that the trainer submit a declaration that they have maintained true
and correct payroll records and have complied with the requirements
of the Labor Code and applicable wage orders of the Industrial
Welfare Commission.
(h) The Labor Commissioner shall establish and maintain a program
to audit the payroll records of trainers who are not parties to a
collective bargaining agreement entered pursuant to Article 2.5
(commencing with Section 19455) and who operate in California for 90
or more racing days in a calendar year, in a manner to ensure that
every subject licensee is audited at least once prior to January 1,
2006. Evidence of substantial noncompliance with the Labor Code and
applicable wage orders of the Industrial Welfare Commission shall be
referred by the board to the Labor Commissioner.
SEC. 7. Section 19590 of the Business and Professions Code is
amended to read:
19590. The board shall adopt rules governing, permitting, and
regulating parimutuel wagering on horse races under the system known
as the parimutuel method of wagering. Parimutuel wagering shall be
conducted only by a person licensed under this chapter to conduct a
horse racing meeting, and only within the enclosure and on the dates
for which horse racing has been authorized by the board. Wagering
instructions concerning funds held in an advance deposit wagering
account shall be deemed to be issued within the licensee's enclosure.
This section shall remain in effect only until January 1, 2008,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2008, deletes or extends that date.
SEC. 8. Section 19590 is added to the Business and Professions
Code, to read:
19590. The board shall adopt rules governing, permitting, and
regulating wagering on horse races under the system known as the
parimutuel method of wagering. Such wagering shall be conducted only
by a person licensed under this chapter to conduct a horse racing
meeting, and only within the enclosure and on the dates for which
horse racing has been authorized by the board. This section shall
become operative on January 1, 2008.
SEC. 9. Section 19595 of the Business and Professions Code is
amended to read:
19595. Any form of wagering or betting on the result of a horse
race other than that permitted by this chapter is illegal. Also
illegal is any wagering or betting on horse races outside an
enclosure where the conduct of horse racing is licensed by the board.
Wagering instructions concerning funds held in an advance deposit
wagering account shall be deemed to be issued within the licensee's
enclosure.
This section shall remain in effect only until January 1, 2008,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2008, deletes or extends that date.
SEC. 9.5. Section 19595 is added to the Business and Professions
Code, to read:
19595. Any form of wagering or betting on the result of a horse
race other than that permitted by this chapter is illegal. Also
illegal is any wagering or betting on horse races outside an
enclosure where the conduct of horse racing is licensed by the board.
This section shall become operative on January 1, 2008.
SEC. 10. Section 19604 is added to the Business and Professions
Code, to read:
19604. Notwithstanding any other provision of law, in addition to
parimutuel wagering otherwise authorized by this chapter, advance
deposit wagering may be conducted upon approval of the board. The
board may authorize any racing association or fair, during the
calendar period it is licensed by the board to conduct a live racing
meeting in accordance with the provisions of Article 4 (commencing
with Section 19480), to accept advance deposit wagers or to allow
these wagers through a betting system or a multijurisdictional
wagering hub in accordance with the following:
(a) Racing associations and racing fairs may form a partnership,
joint venture, or any other affiliation in order to further the
purposes of this section.
(b) As used in this section, "advance deposit wagering" means a
form of parimutuel wagering in which a person residing within
California or outside of this state establishes an account with a
licensee, a board-approved betting system, or a board-approved
multijurisdictional wagering hub located within California or outside
of this state, and subsequently issues wagering instructions
concerning the funds in this account, thereby authorizing the entity
holding the account to place wagers on the account owner's behalf.
An advance deposit wager may be made only by the entity holding the
account pursuant to wagering instructions issued by the owner of the
funds communicated by telephone call or through other electronic
media. The licensee, a betting system, or a multijurisdictional
wagering hub shall ensure the identification of the account's owner
by utilizing methods and technologies approved by the board.
Further, at the request of the board, any licensee, betting system,
or multijurisdictional wagering hub located in California, and any
betting system or multijurisdictional wagering hub located outside of
this state that accepts wagering instructions concerning races
conducted in California or accepts wagering instructions from
California residents, shall provide a full accounting and
verification of the source of the wagers thereby made, including the
zone and breed, in the form of a daily download of parimutuel data to
a database designated by the board. Additionally, when the board
approves a licensee, a betting system, or a multijurisdictional
wagering hub, whether located within California or outside of this
state, to accept advance deposit wagering instructions on any race or
races from California residents, the licensee, betting system, or
multijurisdictional wagering hub may be compensated pursuant to a
contractual agreement with a California licensee, in an amount not to
exceed 6.5 percent of the amount handled on a race or races
conducted in California, and in the case of a race or races conducted
in another jurisdiction, may be compensated in an amount not to
exceed 6.5 percent, plus a fee to be paid to the host racing
association not to exceed 3.5 percent, of the amount handled on that
race or races. The amount remaining after the payment of winning
wagers and after payment of the contractual compensation and host
fee, if any, shall be distributed as a market access fee in
accordance with subdivision (g). As used in this section, "market
access fee" means the contractual fee paid by a betting system or
multijurisdictional wagering hub to the California licensee for
access to the California market for wagering purposes. As used in
this section, "licensee" means any racing association or fair, or
affiliation thereof authorized in subdivision (a).
(c) (1) The board shall develop and adopt rules to license and
regulate all phases of operation of advance deposit wagering for
licensees, betting systems, and multijurisdictional wagering hubs
located in California. Betting systems and multijurisdictional
wagering hubs located and operating in California shall be approved
by the board prior to establishing advance deposit wagering accounts
or accepting wagering instructions concerning those accounts and
shall enter into a written contractual agreement with the bona fide
labor organization that has historically represented the same or
similar classifications of employees at the nearest horse racing
meeting. 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, notwithstanding this requirement.
(2) The board shall develop and adopt rules and regulations
requiring betting systems and multijurisdictional wagering hubs to
establish security access policies and safeguards, including, but not
limited to, the following:
(A) The betting system or wagering hub shall utilize the services
of a board-approved independent third party to perform identity,
residence, and age verification services with respect to persons
establishing an advance deposit wagering account.
(B) The betting system or wagering hub shall utilize personal
identification numbers (PINs) and other technologies to assure that
only the accountholder has access to the advance deposit wagering
account.
(C) The betting system or wagering hub 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 personal and account identification
information.
(D) The betting system or wagering hub shall allow the board
access to its premises to visit, investigate, 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.
(3) The board shall prohibit advance deposit wagering advertising
that it determines to be deceptive to the public. The board also
require, by regulation, that every form of advertising contain a
statement that minors are not allowed to open or have assess to
advance deposit wagering accounts.
(d) As used in this section, a "multijurisdictional wagering hub"
is 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.
(e) As used in this section, a "betting system" is a business
conducted exclusively in this state that facilitates parimutuel
wagering on races it simulcasts and other races it offers in its
wagering menu.
(f) In order for a licensee, betting system, or
multijurisdictional wagering hub to be approved by the board to
conduct advance deposit wagering, it shall meet both of the following
requirements:
(1) All wagers thereby made shall be included in the appropriate
parimutuel pool of the host racing association or fair under a
contractual agreement with the applicable California licensee, in
accordance with the provisions of this chapter.
(2) The amounts deducted from advance deposit wagers shall be in
accordance with the provisions of this chapter.
(g) The amount received as a market access fee from advance
deposit wagers shall be distributed as follows:
(1) An amount equal to .0011 percent of the amount handled on
advance deposit wagers originating in California for each race
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 .0003 percent of the amount handled on
advance deposit wagers originating in California for each race
meeting shall be distributed to the Department of Industrial
Relations 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 bill, however, if that amount would exceed the costs of the
Department of Industrial Relations, the amount distributed to the
department 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 .00165 of the amount handled on advance
deposit wagers that originate in California for each race 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, and an amount equal to 1 percent of
handle from all advance deposit wagers originating from within
California in excess of five hundred million dollars ($500,000,000)
annually, shall be distributed as satellite wagering commissions.
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. 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) With respect to wagers on each breed of racing that originate
in California for each race meeting, after the payment of contractual
obligations to the licensee, the betting system, or the
multijurisdictional wagering hub, and the distribution of the amounts
set forth in paragraphs (1) through (4), inclusive, 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, and this 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. Purse funds generated pursuant to this section may
be utilized to pay 50 percent of the total costs and fees incurred
due to the implementation of advance deposit wagering. "Incentive
awards" shall be 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 shall be payable to the applicable
official registering agency and thereafter distributed as provided in
this chapter. If the provisions of Section 19601.2 apply, then the
amount distributed to the applicable racing associations or fairs
from advance deposit wagering 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. For purposes of this subdivision, the zones of the
state shall be as defined in Section 19530.5, except as modified by
the provisions of subdivision (f) of Section 19601, and the combined
central and southern zones shall be considered one zone.
Notwithstanding any provision of this section to the contrary, the
distribution of the market access fee, other than the distributions
specified in paragraph (1) or (2), may be altered upon the approval
of the board, in accordance with an agreement signed by all parties
receiving a distribution under paragraphs (4) and (5).
(h) Notwithstanding any provisions of this section to the
contrary, all funds derived from advance deposit wagering that
originate from California for each race meeting on out-of-state and
out-of-country thoroughbred races conducted after 6 p.m., Pacific
time, shall be distributed in accordance with this subdivision. With
respect to these wagers, 50 percent of the amount remaining after
the payment of contractual obligations to the multijurisdictional
wagering hub, betting system, or licensee and the amounts set forth
in paragraphs (1) through (5), inclusive, of subdivision (g) shall be
distributed as commissions to thoroughbred associations and racing
fairs, as thoroughbred and fair purses, and as incentive awards in
accordance with subdivision (g), and the remaining 50 percent,
together with all funds derived for each race meeting 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 instate, both on- and off-track, on each breed's own live
races in the previous year by that association, or it's 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.
(i) Notwithstanding any provisions of this section to the
contrary, all funds derived from advance deposit wagering which
originate from California for each race meeting on out-of-state and
out-of-country nonthoroughbred races conducted before 6 p.m., Pacific
time, shall be distributed in accordance with this subdivision.
With respect to these wagers, 50 percent of the amount remaining
after the payment of contractual obligations to the
multijurisdictional wagering hub, betting system, or licensee and the
amounts set forth in paragraphs (1) through (5), inclusive, of
subdivision (g) shall be distributed as commissions as provided in
subdivision (h) 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
subdivision (g).
(j) A racing association, a fair, or a satellite wagering facility
may accept and facilitate the placement of any wager from a patron
at its facility that a California resident could make through a
betting system or multijurisdictional wagering hub duly offering
advance deposit wagering in this state, and the facility accepting
the wager shall receive a 2 percent commission on that wager in lieu
of any distribution for satellite commissions pursuant to subdivision
(g).
(k) Any disputes concerning the interpretation or application of
this section shall be resolved by the board.
This section shall remain in effect only until January 1, 2008,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2008, deletes or extends that date.
SEC. 11. Section 19613 of the Business and Professions Code is
amended to read:
19613. (a) Except as provided in subdivisions (b), (c), (d), (e),
and (f), the portion deducted for purses pursuant to this chapter
shall be paid to or for the benefit of the horsemen at the racing
meeting.
(b) Any association other than a fair that conducts a thoroughbred
racing meeting shall pay to the owners' organization contracting
with the association with respect to the conduct of racing meetings
for administrative expenses and services rendered to owners, an
amount not to exceed two-thirds of 11/2 percent of the portion, and
to a trainers' organization for administrative expenses and services
rendered to trainers and backstretch employees an amount equivalent
to one-third of 11/2 percent of the portion. That association shall
also pay an amount for a pension plan for backstretch personnel to be
administered pursuant to Section 19613.8 equivalent to an additional
1 percent of the portion. The remainder of the portion shall be
distributed as purses.
(c) Any other association may pay to the horsemen's organization
contracting with the association with respect to the conduct of
racing meetings for administrative expenses and services rendered to
horsemen an amount out of the portion as may be determined by the
association by agreement or otherwise, but, in all events, shall
include, relative to a thoroughbred horsemen's organization racing, 1
percent of the portion for a pension plan for backstretch personnel
pursuant to Section 19613.8. The remainder of the portion shall be
distributed as purses.
(d) Notwithstanding subdivisions (b) and (c), any association
conducting a fair racing meeting or conducting a mixed breed racing
meeting shall pay to the horsemen's organizations contracting with
the association with respect to the conduct of races for their
respective breeds of horses at the meetings for administrative
expenses and services rendered to their respective horsemen those
amounts out of the portion as determined by the horsemen's
organization for the respective breeds with the approval of the
board.
Pursuant to this subdivision, amounts not to exceed 3 percent of
the portion for the owners' and trainers' organizations shall be
distributed to any thoroughbred owners' and trainers' organizations
contracting with an association for a fair racing meeting or
participating in mixed breed racing meetings as follows: two-thirds
of 1 percent to the owners' organization and one-third of 1 percent
to the trainers' organization for administrative expenses and
services rendered to both owners and trainers, 1 percent for welfare
funds, and 1 percent for a pension program for backstretch personnel,
to be administered pursuant to Section 19613.8.
(e) Any association other than a fair that conducts a quarter
horse racing meeting, except a mixed breed meeting, shall pay to the
horsemen's organization contracting with the association with respect
to the conduct of racing meetings for administrative expenses and
services rendered to horsemen, an amount not to exceed 3 percent of
the portion. The remainder of the portion shall be distributed as
purses.
(f) For racing meetings other than thoroughbred meetings, if no
contract has been signed between the association conducting the
racing meeting and the organization representing the horsemen by the
time the racing meeting commences, the distribution of purses shall
be governed by the following:
(1) If the association conducted a racing meeting within the past
15 months and a contract was in existence for that meeting with the
horsemen's organization and the association is conducting a
subsequent meeting for the same breed or mixed breeds, the amounts
payable to the horsemen's organization under subdivision (c) shall be
computed under the provisions of the last signed contract between
the parties.
(2) This subdivision applies regardless of the cause of the
failure to execute a contract, whether that failure is a result of
inadvertence or otherwise.
(3) For racing meetings that do not come within paragraph (1), the
board shall, within 15 days after the commencement of the racing
meeting, determine the amounts payable to the horsemen's organization
for administrative expenses and services, and provide for the direct
payment of those amounts.
(g) Amounts distributed pursuant to this section are derived from
owners' purses.
(h) For the purposes of this section, the following definitions
shall apply:
(1) "Owner" means a person currently licensed by the board as an
owner of a thoroughbred racehorse.
(2) "Trainer" means a person currently licensed by the board as an
owner and trainer or as a trainer of a thoroughbred racehorse.
This section shall remain in effect only until January 1, 2008,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2008, deletes or extends that date.
SEC. 11.5. Section 19613 is added to the Business and Professions
Code, to read:
19613. (a) Except as provided in subdivisions (b), (c), (d), (e),
and (f), the portion deducted for purses pursuant to this chapter
shall be paid to or for the benefit of the horsemen at the racing
meeting.
(b) Any association other than a fair that conducts a thoroughbred
racing meeting shall pay to the owners' organization contracting
with the association with respect to the conduct of racing meetings
for administrative expenses and services rendered to owners, an
amount not to exceed two-thirds of 11/2 percent of the portion, and
to a trainers' organization for administrative expenses and services
rendered to trainers and backstretch employees an amount
equivalent to one-third of 11/2
percent of the portion. That association shall also pay an amount
for a pension plan for backstretch personnel to be administered by
the trainers' organization equivalent to an additional 1 percent of
the portion. The remainder of the portion shall be distributed as
purses.
(c) Any other association may pay to the horsemen's organization
contracting with the association with respect to the conduct of
racing meetings for administrative expenses and services rendered to
horsemen an amount out of the portion as may be determined by the
association by agreement or otherwise, but, in all events, shall
include, relative to a thoroughbred horsemen's organization racing, 1
percent of the portion for a pension plan the trainers'
organization. The remainder of the portion shall be distributed as
purses.
(d) Notwithstanding subdivisions (b) and (c), any association
conducting a fair racing meeting shall pay to the horsemen's
organizations contracting with the association with respect to the
conduct of races for their respective breeds of horses at the
meetings for administrative expenses and services rendered to their
respective horsemen those amounts out of the portion as determined by
the horsemen's organization for the respective breeds with the
approval of the board. Pursuant to this subdivision, amounts not to
exceed 3 percent of the portion for the owners' and trainers'
organizations shall be distributed to any thoroughbred owners' and
trainers' organizations contracting with an association for a fair
racing meeting or participating in mixed breed racing meetings as
follows: two-thirds of 1 percent to the owners organization and
one-third of 1 percent to the trainers' organization for
administrative expenses and services rendered to both owners and
trainers, 1 percent for welfare funds, and 1 percent for a pension
program for backstretch personnel, to be administered by the
thoroughbred trainers' organization.
(e) Any association other than a fair that conducts a quarter
horse racing meeting shall pay to the horsemen's organization
contracting with the association with respect to the conduct of
racing meetings for administrative expenses and services rendered to
horsemen, an amount not to exceed 3 percent of the portion. The
remainder of the portion shall be distributed as purses.
(f) For racing meetings other than thoroughbred meetings, if no
contract has been signed between the association conducting the
rating meeting and the organization representing the horsemen by the
time the racing meeting commences, the distribution of purses shall
be governed by the following:
(1) If the association conducted a racing meeting within the past
15 months and a contract was in existence, for that meeting with the
horsemen's organization and the association is conducting a
subsequent meeting for the same breed or mixed breeds, the amounts
payable to the horsemen's organization under subdivision (c) shall be
computed under the provisions of the last signed contract between
the parties.
(2) This subdivision applies regardless of the cause of the
failure to execute a contract, whether that failure is a result of
inadvertence or otherwise.
(3) For racing meetings that do not come within paragraph (1), the
board shall, within 15 days after the commencement of the racing
meeting, determine the amounts payable to the horsemen's organization
for administrative expenses and services, and provide for the direct
payment of those amounts.
(g) Amounts distributed pursuant to this section are derived from
owners' purses.
(h) For the purposes of this section, the following definitions
shall apply:
(1) "Owner" means a person currently licensed by the board as an
owner of a thoroughbred racehorse.
(2) "Trainer" means a person currently licensed by the board as an
owner and trainer or as a trainer of a thoroughbred racehorse.
(i) This section shall become operative on January 1, 2008.
SEC. 12. Section 19613.8 is added to the Business and Professions
Code, to read:
19613.8. Within 60 days of a statewide majority of backstretch
workers having chosen to be represented by an exclusive collective
bargaining agent pursuant to Article 2.5 (commencing with Section
19455) or any other law, and so long as a majority continues to be
represented by the agent, that agent shall designate two
representatives to replace two of the members if the CHBPA Pension
Administrative Committee and the plan document shall be amended to
provide for this representation.
SEC. 13. Section 19641.2 is added to the Business and Professions
Code, to read:
19641.2. (a) The nonprofit foundation authorized to receive funds
pursuant to Section 19641 shall use those funds to administer a
health and welfare trust fund without prejudice and for the benefit
of every eligible person. The officers and directors of the health
and welfare trust fund shall have a fiduciary responsibility to
manage the fund for the benefit of the beneficiaries.
(b) Every employer of backstretch workers shall, upon request,
submit or provide access to the administrator of the welfare program
for backstretch workers any employment records necessary for prompt
payment of benefits and proper administration of the program.
(c) At least one member of the health and welfare fund board shall
be a member without financial interest in the horse racing industry
appointed from a list of nominees submitted jointly by the California
State Council of the Service Employees International Union, the
Jockey's Guild, and the California Teamsters Public Affairs Council.
(d) Nothing in this section is intended to affect the status of
the welfare fund as a charity under Section 501(c)(3) of the federal
Internal Revenue Code or it compliance with the Charitable Purposes
Act (Article 7 (commencing with Section 12580) of Chapter 6 of Part 2
of Division 3 of Title 2 of the Government Code).
SEC. 14. The Legislature hereby finds and declares the following
with respect to the addition of Section 19604 to the Business and
Professions Code:
(a) There are currently over 1,200 websites on the Internet that
provide for online gambling, including wagering on horse races, as
well as other types of gambling.
(b) Online wagering activity occurs in a way which is unregulated
and unlicensed by the California Horse Racing Board, avoiding all of
the legal and law enforcement protections administered by the
California Horse Racing Board, including appropriate consumer
protection measures and threatens the health, safety, economy, and
welfare of the citizens and businesses in California.
(c) Unregulated gaming websites have a deleterious and very
negative impact on horse racing in California because they result in
a significantly reduced, lawful wagering activity at locations which
are regulated and licensed by the California Horse Racing Board,
including racetracks and satellite wagering facilities, and threaten
the positive reputation of California horse racing.
(d) Unregulated gaming websites result in a revenue loss to the
State of California, as well as California's horse racing industry.
Those losses are estimated at over two hundred fifty million dollars
($250,000,000) in wagering handle and result in the loss of at least
twelve million five hundred thousand dollars ($12,500,000) in purses
for California races.
(e) That California's horse racing industry provides over 50,000
jobs in this state, as well as revenue to the General Fund which
supports California's county fairs, as well as other important
programs, and further, has operated under California law for over 60
years in a strictly regulated environment which protects California
residents and provides for necessary oversight of its activities.
(f) Ten other states have authorized account wagering, further
placing, California's horse racing industry at a competitive
disadvantage relative to the industry in those states, and
threatening the viability of the horse racing industry in California.
(g) It is the policy of this state to make every effort to
regulate all wagering activity on California horse racing, and to
assure that the horse racing industry in California is able to
compete with other states, provide jobs to California residents, and
help assure the overall health and viability of the industry in
California.
(h) That it is the intent of the Legislature to ensure that the
California Horse Racing Board has the authority necessary to regulate
all wagering activity on horse racing in California, and to ensure
all appropriate steps are taken to prohibit access of wagering to
minors.
SEC. 15. The provisions of this act are severable. If any
provision of this act or its application is held invalid, that
invalidity shall not affect other provisions or applications that can
be given effect without the invalid provision or application.