BILL ANALYSIS                                                                                                                                                                                                    

                                                                  AB 2201
                                                                  Page  1

          Date of Hearing:   May 5, 2010

                                Felipe Fuentes, Chair

                    AB 2201 (Coto) - As Amended:  April 15, 2010 

          Policy Committee:                              Governmental  
          Organization Vote:                            22 - 0 

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:              


          This bill would authorize the California Horse Racing Board  
          (CHRB) to permit a California harness racing association to  
          accept wagers on the full card of races conducted by another  
          racing association on the date of the Cane Pace.

           FISCAL EFFECT  

          Potential increase in revenue available to fund the CHRB and the  
          Kenneth L. Maddy Equine Analytical Chemistry Laboratory at the  
          University of California, Davis due to increased wagering  
          opportunities. However, the CHRB is not required under current  
          law to provide the Legislature with the funding formula for the  
          board, and CHRB considers its funding formula a confidential  
          matter between the racing industry and the board.  Thus, it is  
          unknown whether an increase in racing revenue would impact these  
          two state entities or increase the revenue available in the  
          Horse Racing Fund.


           1)Rationale  . This bill will allow a harness racing association  
            in California to import all of the races conducted on Cane  
            Pace day, irrespective of the six-race day limit.  The author  
            intends for this bill to give the California harness racing  
            industry a marketing tool to increase on-track and off-track  
            attendance on this specific day.  As a result of the increased  
            attendance, the author hopes this bill will provide the  
            industry with a mechanism to increase track commissions,  


                                                                  AB 2201
                                                                  Page  2

            purses, and breeder's awards.

           2)Harness racing  is a form of horse-racing in which  
            standard-bred horses race in a specified gait, either trotting  
            or a faster gait called pacing. The jockey sits in a  
            two-wheeled cart pulled by the horse. In California, harness  
            racing is held exclusively at Cal Expo in Sacramento.  For  
            2010, the harness racing meets are scheduled from December 26,  
            2009 to June 19, 2010 and from August 13, 2010 to December 18,  

           3)The Cane Pace . The Cane Pace is a harness horse race run  
            annually since 1955.  In 1956 the race joined with the Little  
            Brown Jug and the Messenger Stakes to become the first leg in  
            the Triple Crown of Harness Racing for Pacers.  Since 1998,  
            the race is held at the Freehold Raceway in Freehold Borough,  
            New Jersey.  Established in 1853, Freehold Raceway is the  
            oldest half-mile racetrack in the United States.

           4)The Impact of SB 16 XX on CHRB Funding  . SB 16 XX (Ashburn;  
            Chapter 12, Statutes of 2009-10 Second Extraordinary Session)  
            provides among other things, that beginning on July 1, 2009,  
            and annually thereafter, $32 million shall be appropriated  
            from the state's General Fund and paid into the Fair and  
            Exposition Fund for the financial support of the network of  
            California fairs.  

            In addition, this legislation states that all racing  
            associations and fairs including all breeds of racing shall  
            participate in the funding of the board in accordance with a  
            formula devised by the board in consultation with the  
            industry. The legislation further states that the baseline  
            funding for the board and equine drug testing program in the  
            first fiscal year after the enactment of this section shall be  
            the amount approved in the 2008-09 Budget Act.  Any changes to  
            that funding level need to be approved by the Legislature. 

            Because SB 16 XX states that CHRB develop a funding formula to  
            maintain its baseline funding, but does not require CHRB  
            provide that formula to the Legislature, it is difficult to  
            determine whether bills that may increase or decrease wagering  
            pool or change the takeout will have an impact on the funding  
            for either the CHRB or the Maddy Laboratory. 
          5)Related Legislation  . AB 3074 (Governmental Organization  


                                                                  AB 2201
                                                                  Page  3

            Committee; Chapter 510, Statutes of 2008) allows a harness  
            racing association in California to import all of the races  
            conducted on Kentucky Futurity day, irrespective of the  
            six-race day limit in law and increases, from 23 to 32, the  
            limitation on the total number of out-of-state Thoroughbred  
            races that may be imported per day by a Thoroughbred  
            association or fair that is conducting a live race meet.   

           Analysis Prepared by  :    Julie Salley-Gray / APPR. / (916)