BILL ANALYSIS AB 605 Page 1 ASSEMBLY THIRD READING AB 605 (Portantino) As Introduced February 25, 2009 2/3 vote. Appropriation GOVERNMENTAL ORGANIZATION 16-0 APPROPRIATIONS 16-0 ----------------------------------------------------------------- |Ayes:|Price, Anderson, Chesbro, |Ayes:|De Leon, Nielsen, | | |Cook, | |Ammiano, | | |De Leon, Evans, Galgiani, | |Charles Calderon, Davis, | | |Hall, Hill, Lieu, | |Duvall, Krekorian, Hall, | | |Mendoza, Nestande, | |Harkey, Miller, | | |Portantino, Torres, | |John A. Perez, Price, | | |Torrico, Tran | |Skinner, Solorio, Audra | | | | |Strickland, Torlakson | | | | | | |-----+--------------------------+-----+--------------------------| | | | | | ----------------------------------------------------------------- SUMMARY : Allows Thoroughbred horse racing results to be included in proposition pari-mutuel pool wagers. EXISTING LAW : 1)Provides that CHRB regulate the various forms of horse racing authorized in this state. 2)Requires various deductions and distributions to be made from pari-mutuel pools as specified. 3)Defines "conventional pari-mutuel pool" as the total wagers on any horse or horses in a particular race to win, place, or show. 4)Defines "exotic pari-mutuel pool" as the total wagers on the finishing position of two or more horses in a particular race, such as a quinella or exacta wager, or on horses to win two or more races, such as a daily double, pick six wagers, or on other wagers approved by CHRB. 5)Defines a "proposition pari-mutuel pool" as the total wagers under the pari-mutuel system on propositions approved by the board that are based on the results of a live Quarter horse or AB 605 Page 2 harness horse race or races. 6)Permits CHRB, upon the request of the association or fair accepting the wager, and the organization of participating horsemen, to set the percentage deducted from the pari-mutuel pool for any new wager introduced after January 1, 2004, as specified. FISCAL EFFECT : According to the Assembly Appropriations Committee, potential increase in revenue available to fund the CHRB and the Kenneth L. Maddy Equine Analytical Laboratory at the University of California, Davis due to increased wagering opportunities. COMMENTS : According to the author, this bill will also allow an association, which conducts Thoroughbred racing to offer, "propositional wagering" on a thoroughbred race. For instance, this simplified form of betting would allow an individual to choose between odd or even bets, "will" or "will not" wagers, or head to head horse wagers. Currently, Quarter horse and harness racing associations can offer this type of wagering while operating a live race meet in California on the respective breeds. AB 605 will allow all segments of the industry to take advantage of this new type of wager, and in the process, create the potential for new revenue for California's horse racing industry as well as new fans for the sport. Supporters indicate that propositional wagers are useful as a marketing tool to increase public awareness of special events, such as the Kentucky Derby, the Preakness Stakes, the Belmont Stakes and the Breeders' Cup. Incidentally, to date, CHRB has not approved any propositional wagering for Quarter horse or harness races since the law was instituted in 1996 and amended in 2005. Supporters note that this will change because Thoroughbred interests believe this type of wager can be used to stimulate attendance and participation in horse racing at the live track and satellite facilities. This bill is somewhat identical to AB 315 (Wright) and AB 2753 (Strickland), which were both vetoed by the Governor during the AB 605 Page 3 1999-2000 legislative session. Prior legislation : AB 834 (Jones), Chapter 119, Statutes of 2005, contained a provision, which allowed harness racing results to be included in proposition pari-mutuel pool wagers. SB 1439 (Ayala), Chapter 551, Statutes of 1996. Created a new category of wager available at Quarter horse races called the "propositional" wager. Analysis Prepared by : Eric Johnson / G. O. / (916) 319-2531 FN: 0000735