BILL NUMBER: AB 2215	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 28, 2010

INTRODUCED BY   Assembly Member Fuentes

                        FEBRUARY 18, 2010

   An act to amend Section 19604 of the Business and Professions
Code, relating to horse racing.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2215, as amended, Fuentes. Horse racing: advance deposit
wagering: wagering account facilities.
   Existing law authorizes advance deposit wagering to be conducted,
with the approval of the California Horse Racing Board. Existing law
requires the board to develop and adopt rules to license and regulate
all phases of operation of advance deposit wagering for advance
deposit wagering providers operating in California.
   This bill would authorize the board to adopt rules and regulations
authorizing advance deposit wagering providers to create and
administer wagering accounts at  existing satellite wagering
facilities or minisatellite wagering  facilities 
located within this state  through which persons may deposit
cash funds or vouchers, issue wagering instructions, and withdraw
cash funds or vouchers, subject to the approval of racing
associations or satellite wagering facilities located within 
10   20  miles of a facility administering those
accounts, and the approval of the horsemen's organization responsible
for negotiating with the racing associations or satellite wagering
facilities.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 19604 of the Business and Professions Code is
amended to read:
   19604.  The board may authorize any racing association, racing
fair, betting system, or multijurisdictional wagering hub to conduct
advance deposit wagering in accordance with this section. Racing
associations, racing fairs, and their respective horsemen's
organizations may form a partnership, joint venture, or any other
affiliation in order to further the purposes of this section.
   (a) As used in this section, the following definitions apply:
   (1) "Advance deposit wagering" (ADW) means a form of parimutuel
wagering in which a person residing within California or outside of
this state establishes an account with an ADW provider, and
subsequently issues wagering instructions concerning the funds in
this account, thereby authorizing the ADW provider holding the
account to place wagers on the account owner's behalf.
   (2) "ADW provider" means a licensee, betting system, or
multijurisdictional wagering hub, located within California or
outside this state, that is authorized to conduct advance deposit
wagering pursuant to this section.
   (3) "Betting system" means a business conducted exclusively in
this state that facilitates parimutuel wagering on races it
simulcasts and other races it offers in its wagering menu.
   (4) "Breed of racing" means as follows:
   (A) With respect to associations and fairs licensed by the board
to conduct thoroughbred, fair, or mixed breed race meetings, "breed
of racing" shall mean thoroughbred.
   (B) With respect to associations licensed by the board to conduct
quarter horse race meetings, "breed of racing" shall mean quarter
horse.
   (C) With respect to associations and fairs licensed by the board
to conduct standardbred race meetings, "breed of racing" shall mean
standardbred.
   (5) "Contractual compensation" means the amount paid to an ADW
provider from advance deposit wagers originating in this state.
Contractual compensation includes, but is not limited to, hub fee
payments, and may include host fee payments, if any, for out-of-state
and out-of-country races. Contractual compensation is subject to the
following requirements:
   (A) Excluding contractual compensation for host fee payments,
contractual compensation shall not exceed 6.5 percent of the amount
wagered.
   (B) The host fee payments included within contractual compensation
shall not exceed 3.5 percent of the amount wagered. Notwithstanding
this provision, the host fee payment with respect to wagers on the
Kentucky Derby, Preakness Stakes, Belmont Stakes, and selected
Breeders' Cup Championship races may be negotiated by the ADW
provider, the racing associations accepting wagers on those races
pursuant to Section 19596.2, and the horsemen's organization.
   (C) In order to ensure fair and consistent market access fee
distributions to associations, fairs, horsemen, and breeders, for
each breed of racing, the percentage of wagers paid as contractual
compensation to an ADW provider pursuant to the terms of a hub
agreement with a racing association or fair when that racing
association or fair is conducting live racing shall be the same as
the percentage of wagers paid as contractual compensation to that ADW
provider when that racing association or fair is not conducting live
racing.
   (6) "Horsemen's organization" means, with respect to a particular
racing meeting, the organization recognized by the board as
responsible for negotiating purse agreements on behalf of horsemen
participating in that racing meeting.
   (7) "Hub agreement" means a written agreement providing for
contractual compensation paid with respect to advance deposit wagers
placed by California residents on a particular breed of racing
conducted outside of California. In the event a hub agreement exceeds
a term of two years, then an ADW provider, one or more racing
associations or fairs that together conduct no fewer than five weeks
of live racing for the breed covered by the hub agreement, and the
horsemen's organization responsible for negotiating purse agreements
for the breed covered by the hub agreement shall be signatories to
the hub agreement. A hub agreement is required for an ADW provider to
receive contractual compensation for races conducted outside of
California.
   (8) "Hub agreement arbitration" means an arbitration proceeding
pursuant to which the disputed provisions of the hub agreement
pertaining to the hub or host fees from wagers on races conducted
outside of California provided pursuant to paragraph (2) of
subdivision (b) are determined in accordance with the provisions of
this paragraph. If a hub agreement arbitration is requested, all of
the following shall apply:
   (A) The ADW provider shall be permitted to accept advance deposit
wagers from California residents.
   (B) The contractual compensation received by the ADW provider
shall be the contractual compensation specified in the hub agreement
that is the subject of the hub agreement arbitration.
   (C) The difference between the contractual compensation specified
in subparagraph (B) and the contractual compensation determined to be
payable at the conclusion of the hub agreement arbitration shall be
calculated and paid within 15 days following the arbitrator's
decision and order. The hub agreement arbitration shall be held as
promptly as possible, but in no event more than 60 days following the
demand for that arbitration. The arbitrator shall issue a decision
no later than 15 days following the conclusion of the arbitration. A
single arbitrator jointly selected by the ADW provider and the party
requesting a hub agreement arbitration shall conduct the hub
agreement arbitration. However, if the parties cannot agree on the
arbitrator within seven days of issuance of the written demand for
arbitration, then the arbitrator shall be selected pursuant to the
Streamlined Arbitration Rules and Procedures of the Judicial
Arbitration and Mediation Services, or pursuant to the applicable
rules of its successor organization. In making the hub agreement
arbitration determination, the arbitrator shall be required to choose
between the contractual compensation of the hub agreement agreed to
by the ADW provider or whatever different terms for the hub agreement
were proposed by the party requesting the hub agreement arbitration.
The arbitrator shall not be permitted to impose new, different, or
compromised terms to the hub agreement. The arbitrator's decision
shall be final and binding on the parties. If an arbitration is
requested, either party may bring an action in state court to compel
a party to go into arbitration or to enforce the decision of the
arbitrator. The cost of the hub agreement arbitration, including the
cost of the arbitrator, shall be borne in equal shares by the parties
to the hub agreement and the party or parties requesting a hub
agreement arbitration. The hub agreement arbitration shall be
administered by the Judicial Arbitration and Mediation Services
pursuant to its Streamlined Arbitration Rules and Procedures or its
successor organization.
   (9) "Incentive awards" means those payments provided for in
Sections 19617.2, 19617.7, 19617.8, 19617.9, and 19619. The amount
determined to be payable for incentive awards under this section
shall be payable to the applicable official registering agency and
thereafter distributed as provided in this chapter.
   (10) "Licensee" means any racing association or fair licensed to
conduct a live racing meet in this state, or affiliation thereof,
authorized under this section.
   (11) "Market access fee" means the amount of advance deposit
wagering handle remaining after the payment of winning wagers, and
after the payment of contractual compensation, if any, to an ADW
provider. Market access fees shall be distributed in accordance with
subdivision (f).
   (12) "Multijurisdictional wagering hub" means a business conducted
in more than one jurisdiction that facilitates parimutuel wagering
on races it simulcasts and other races it offers in its wagering
menu.
   (13) "Racing fair" means a fair authorized by the board to conduct
live racing.
   (14) "Zone" means the zone of the state, as defined in Section
19530.5, except as modified by the provisions of subdivision (f) of
Section 19601. For these purposes, the central and southern zones
shall together be considered one zone.
   (b) Wagers shall be accepted according to the procedures set forth
in this subdivision.
   (1) No ADW provider shall accept wagers or wagering instructions
on races conducted in California from a resident of California unless
all of the following conditions are met:
   (A) The ADW provider is licensed by the board.
   (B) A written agreement allowing those wagers exists with the
racing association or fair conducting the races on which the wagers
are made.
   (C) The agreement referenced in subparagraph (B) shall have been
approved in writing by the horsemen's organization responsible for
negotiating purse agreements for the breed on which the wagers are
made in accordance with the Interstate Horseracing Act (15 U.S.C.
Sec. 3001, et seq.), regardless of the location of the ADW provider,
whether in California or otherwise, including, without limitation,
any and all requirements contained therein with respect to written
consents and required written agreements of horsemen's groups to the
terms and conditions of the acceptance of those wagers and any
arrangements as to the exclusivity between the host racing
association or fair and the ADW provider. For purposes of this
subdivision, the substantive provisions of the Interstate Horseracing
Act shall be taken into account without regard to whether, by its
own terms, that act is applicable to advance deposit wagering on
races conducted in California accepted from residents of California.
   (2) No ADW provider shall accept wagers or wagering instructions
on races conducted outside of California from a resident of
California unless all of the following conditions are met:
   (A) The ADW provider is licensed by the board.
   (B) There is a hub agreement between the ADW provider and one or
both of (i) one or more racing associations or fairs that together
conduct no fewer than five weeks of live racing on the breed on which
wagering is conducted during the calendar year during which the
wager is placed, and (ii) the horsemen's organization responsible for
negotiating purse agreements for the breed on which wagering is
conducted.
   (C) If the parties referenced in clauses (i) and (ii) of
subparagraph (B) are both signatories to the hub agreement, then no
party shall have the right to request a hub agreement arbitration.
   (D) If only the party or parties referenced in clause (i) of
subparagraph (B) is a signatory to the hub agreement, then the
signatories to the hub agreement shall, within five days of execution
of the hub agreement, provide a copy of the hub agreement to the
horsemen's organization responsible for negotiating purse agreements
for the breed on which wagering is conducted for each race conducted
outside of California on which California residents may place advance
deposit wagers. Prior to receipt of the hub agreement, the horsemen'
s organization shall sign a nondisclosure agreement with the ADW
provider agreeing to hold confidential all terms of the hub
agreement. If the horsemen's organization wants to request a hub
agreement arbitration, it shall send written notice of its election
to the signatories to the hub agreement within 10 days after receipt
of the copy of the hub agreement, and shall provide its alternate
proposal to the hub and host fees specified in the hub agreement with
that written notice. If the horsemen's organization does not provide
that written notice within the 10-day period, then no party shall
have the right to request a hub agreement arbitration. If the
horsemen's organization does provide that written notice within the
10-day period, then the ADW provider shall have 10 days to elect in
writing to do one of the following:
   (i) Abandon the hub agreement.
   (ii) Accept the alternate proposal submitted by the horsemen's
organization.
   (iii) Proceed with a hub agreement arbitration.
   (E) If only the party referenced in clause (ii) of subparagraph
(B) is a signatory to the hub agreement, then the signatories to the
hub agreement shall, within five days of execution of the hub
agreement, provide written notice of the host and hub fees applicable
pursuant to the hub agreement for each race conducted outside of
California on which California residents may place advance deposit
wagers, which notice shall be provided to all racing associations and
fairs conducting live racing of the same breed covered by the hub
agreement. If any racing association or fair wants to request a hub
agreement arbitration, it shall send written notice of its election
to the signatories to the hub agreement within 10 days after receipt
of the notice of host and hub fees. It shall also provide its
alternate proposal to the hub and host fees specified in the hub
agreement with the notice of its election. If more than one racing
association or fair provides notice of their request for hub
agreement arbitration, those racing associations or fairs, or both,
shall have a period of five days to jointly agree upon which of their
alternate proposals shall be the official proposal for purposes of
the hub agreement arbitration. If one or more racing associations or
fairs that together conduct no fewer than five weeks of live racing
on the breed on which wagering is conducted during the calendar year
during which the wager is placed does not provide written notice of
their election to arbitrate within the 10-day period, then no party
shall have the right to request a hub agreement arbitration. If a
valid hub agreement arbitration request is made, then the ADW
provider shall have 10 days to elect in writing to do one of the
following:
   (i) Abandon the hub agreement.
   (ii) Accept the alternate proposal submitted by the racing
associations or fairs.
   (iii) Proceed with a hub agreement arbitration.
   The results of any hub agreement arbitration elected pursuant to
this subdivision shall be binding on all other associations and fairs
conducting live racing on that breed.
   (F) The acceptance thereof is in compliance with the provisions of
the Interstate Horseracing Act (15 U.S.C. Sec. 3001, et seq.),
regardless of the location of the ADW provider, whether in California
or otherwise, including, without limitation, any and all
requirements contained therein with respect to written consents and
required written agreements of horsemen's groups to the terms and
conditions of the acceptance of such wagers and any arrangements as
to the exclusivity between the host racing association or fair and
the ADW provider.
   (c) An advance deposit wager may be made only by the ADW provider
holding the account pursuant to wagering instructions issued by the
owner of the funds communicated by telephone call or through other
electronic media. The ADW provider shall ensure the identification of
the account's owner by using methods and technologies approved by
the board. Any ADW provider that accepts wagering instructions
concerning races conducted in California, or accepts wagering
instructions originating in California, shall provide a full
accounting and verification of the source of the wagers thereby made,
including the postal ZIP Code and breed of the source of the wagers,
in the form of a daily download of parimutuel data to a database
designated by the board. The daily download shall be delivered in a
timely basis using file formats specified by the database designated
by the board, and shall include any and all data necessary to
calculate and distribute moneys according to the rules and
regulations governing California parimutuel wagering. Any and all
reasonable costs associated with the creation, provision, and
transfer of this data shall be borne by the ADW provider.
   (d) (1) (A) The board shall develop and adopt rules to license and
regulate all phases of operation of advance deposit wagering for ADW
providers operating in California.
   (B) The board shall not approve an application for an original or
renewal license as an ADW provider unless the entity, if requested in
writing by a bona fide labor organization no later than 90 days
prior to licensing, has entered into a contractual agreement with
that labor organization that provides all of the following:
   (i) The labor organization has historically represented employees
who accept or process any form of wagering at the nearest horse
racing meeting located in California.
   (ii) The agreement establishes the method by which the ADW
provider will agree to recognize and bargain in good faith with a
labor organization which has demonstrated majority status by
submitting authorization cards signed by those employees who accept
or process any form of wagering for which a California ADW license is
required.
   (iii) The agreement requires the ADW provider to maintain its
neutrality concerning the choice of those employees who accept or
process any form of wagering for which a California ADW license is
required whether or not to authorize the labor organization to
represent them with regard to wages, hours, and other terms and
conditions of employment.
   (iv) The agreement applies to those classifications of employees
who accept or process wagers for which a California ADW license is
required whether the facility is located within or outside of
California.
   (C) (i) The agreement required by subparagraph (B) shall not be
conditioned by either party upon the other party agreeing to matters
outside the requirements of subparagraph (B).
   (ii) The requirement in subparagraph (B) shall not apply to an ADW
provider which has entered into a collective bargaining agreement
with a bona fide labor organization that is the exclusive bargaining
representative of employees who accept or process parimutuel wagers
on races for which an ADW license is required whether the facility is
located within or outside of California.
   (D) Permanent state or county employees and nonprofit
organizations that have historically performed certain services at
county, state, or district fairs may continue to provide those
services.
   (E) Parimutuel clerks employed by racing associations or fairs or
employees of ADW providers who accept or process any form of wagers
who are laid off due to lack of work shall have preferential hiring
rights for new positions with their employer in occupations whose
duties include accepting or processing any form of wagers, or the
operation, repair, service, or maintenance of equipment that accepts
or processes any form of wagering at a racetrack, satellite wagering
facility, or ADW provider licensed by the board. The preferential
hiring rights established by this subdivision shall be conditioned
upon the employee meeting the minimum qualification requirements of
the new job.
   (2) The board shall develop and adopt rules and regulations
requiring ADW providers to establish security access policies and
safeguards, including, but not limited to, the following:
   (A) The ADW provider shall use board-approved methods to perform
location and age verification confirmation with respect to persons
establishing an advance deposit wagering account.
   (B) The ADW provider shall use personal identification numbers
(PINs) or other technologies to assure that only the accountholder
has access to the advance deposit wagering account.
   (C) The ADW provider shall provide for withdrawals from the
wagering account only by means of a check made payable to the
accountholder and sent to the address of the accountholder or by
means of an electronic transfer to an account held by the verified
accountholder or the accountholder may withdraw funds from the
wagering account at a facility approved by the board by presenting
verifiable account identification information.
   (D) The ADW provider shall allow the board access to its premises
to visit, investigate, audit  ,  and place expert
accountants and other persons it deems necessary for the purpose of
ensuring that its rules and regulations concerning credit
authorization, account access, and other security provisions are
strictly complied with. To ensure that the amounts retained from the
parimutuel handle are distributed under law, rules, or agreements,
any ADW provider that accepts wagering instructions concerning races
conducted in California or accepts wagering instructions originating
in California shall provide an independent "agreed-upon procedures"
audit for each California racing meeting, within 60 days of the
conclusion of the race meeting. The auditing firm to be used and the
content and scope of the audit, including host fee obligations, shall
be set forth in the applicable agreement. The ADW provider shall
provide the board, horsemen's organizations, and the host racing
association with an annual parimutuel audit of the financial
transactions of the ADW provider with respect to wagers authorized
pursuant to this section, prepared in accordance with generally
accepted auditing standards and the requirements of the board. Any
and all reasonable costs associated with those audits shall be borne
by the ADW provider.
   (3) The board shall prohibit advance deposit wagering advertising
that it determines to be deceptive to the public. The board shall
also require, by regulation, that every form of advertising contain a
statement that minors are not allowed to open or have access to
advance deposit wagering accounts.
   (4) Notwithstanding any other law, the board may adopt rules and
regulations authorizing ADW providers  that are licensed to
conduct advance deposit wagering pursuant to this section  to
create and administer wagering accounts at  facilities
located within this state   existing satellite wagering
facilities or minisatellite wagering facilities  through which
persons may deposit cash funds or vouchers, issue wagering
instructions, and withdraw cash funds or vouchers, subject to the
approval of racing associations or satellite wagering facilities
located within  10   20  miles of a
facility administering those accounts, and the approval of the
horsemen's organization responsible for negotiating with the racing
associations or satellite wagering facilities.
   (e) In order for a licensee, betting system, or
multijurisdictional wagering hub to be approved by the board as an
ADW provider, it shall meet both of the following requirements:
   (1) All wagers thereby made shall be included in the appropriate
parimutuel pool under a contractual agreement with the applicable
host track.
   (2) The amounts deducted from advance deposit wagers shall be in
accordance with the provisions of this chapter.
   (f) After the payment of contractual compensation, the amounts
received as market access fees from advance deposit wagers, which
shall not be considered for purposes of Section 19616.51, shall be
distributed as follows:
   (1) An amount equal to 0.0011 multiplied by the amount handled on
advance deposit wagers originating in California for each racing
meeting shall be distributed to the Center for Equine Health to
establish the Kenneth L. Maddy Fund for the benefit of the School of
Veterinary Medicine at the University of California at Davis.
   (2) An amount equal to 0.0003 multiplied by the amount handled on
advance deposit wagers originating in California for each racing
meeting shall be distributed to the 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 section. 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 0.00165 multiplied by the amount handled on
advance deposit wagers that originate in California for each racing
meeting shall be distributed as follows:
   (A) One-half of the amount shall be distributed to supplement the
trainer-administered pension plans for backstretch personnel
established pursuant to Section 19613. Moneys distributed pursuant to
this subparagraph shall supplement, and not supplant, moneys
distributed to that fund pursuant to Section 19613 or any other
provision of law.
   (B) One-half of the amount shall be distributed to the welfare
fund established for the benefit of horsemen and backstretch
personnel pursuant to subdivision (b) of Section 19641. Moneys
distributed pursuant to this subparagraph shall supplement, and not
supplant, moneys distributed to that fund pursuant to Section 19641
or any other provision of law.
   (4) With respect to wagers on each breed of racing that originate
in California, an amount equal to two percent of the first two
hundred fifty million dollars ($250,000,000) of handle from all
advance deposit wagers originating from within California annually,
an amount equal to 1.5 percent of the next two hundred fifty million
dollars ($250,000,000) of handle from all advance deposit wagers
originating from within California annually, an amount equal to one
percent of the next two hundred fifty million dollars ($250,000,000)
of handle from all advance deposit wagers originating from within
California annually, and an amount equal to 0.50 percent of handle
from all advance deposit wagers originating from within California in
excess of seven hundred fifty million dollars ($750,000,000)
annually, shall be distributed as satellite wagering commissions.
Satellite wagering facilities that were not operational in 2001,
other than one each in the cities of Inglewood and San Mateo, and two
additional facilities each operated by the Alameda County Fair and
the Los Angeles County Fair and their partners and other than
existing facilities which are relocated, are not eligible for
satellite wagering commission distributions under this section. The
satellite wagering facility commissions calculated in accordance with
this subdivision shall be distributed to each satellite wagering
facility and racing association or fair in the zone in which the
wager originated in the same relative proportions that the satellite
wagering facility or the racing association or fair generated
satellite commissions during the previous calendar year. If there is
a reduction in the satellite wagering commissions pursuant to this
section, the benefits
therefrom shall be distributed equitably as purses and commissions
to all associations and racing fairs generating advance deposit
wagers in proportion to the handle generated by those associations
and racing fairs. If a satellite wagering facility is permanently
closed other than for renovation or remodeling, or if a satellite
wagering facility is unwilling or unable to accept all of the signals
that are available to that facility, the commissions otherwise
provided for in this subdivision that would be payable to that
facility shall be proportionately reduced to take into account the
time that satellite wagering is no longer conducted by that facility,
or the payment of those commissions shall be eliminated entirely if
the facility is permanently closed, and, in either case, the
satellite wagering commissions not paid shall be proportionately
redistributed to the other eligible satellite wagering facilities.
For purposes of this section, the purse funds distributed pursuant to
Section 19605.72 shall be considered to be satellite wagering
facility commissions attributable to thoroughbred races at the
locations described in that section.
   (5) After the distribution of the amounts set forth in paragraphs
(1) to (4), inclusive, the remaining market access fees from advance
deposit wagers originating in California shall be as follows:
   (A) With respect to wagers on each breed of racing, the amount
remaining shall be distributed to the racing association or fair that
is conducting live racing on that breed during the calendar period
in the zone in which the wager originated. That amount shall be
allocated to that racing association or fair as commissions, to
horsemen participating in that racing meeting in the form of purses,
and as incentive awards, in the same relative proportion as they were
generated or earned during the prior calendar year at that racing
association or fair on races conducted or imported by that racing
association or fair after making all deductions required by
applicable law. Notwithstanding any other provision of law, the
distributions with respect to each breed of racing set forth in this
subparagraph may be altered upon the approval of the board, in
accordance with an agreement signed by the respective associations,
fairs, horsemen's organizations, and breeders organizations receiving
those distributions.
   (B) If the provisions of Section 19601.2 apply, then the amount
distributed to the applicable racing associations or fairs shall
first be divided between those racing associations or fairs in direct
proportion to the total amount wagered in the applicable zone on the
live races conducted by the respective association or fair.
Notwithstanding this requirement, when the provisions of subdivision
(b) of Section 19607.5 apply to the 2nd District Agricultural
Association in Stockton or the California Exposition and State Fair
in Sacramento, then the total amount distributed to the applicable
racing associations or fairs shall first be divided equally, with 50
percent distributed to applicable fairs and 50 percent distributed to
applicable associations.
   (C) Notwithstanding any provisions of this section to the
contrary, with respect to wagers on out-of-state and out-of-country
thoroughbred races conducted after 6 p.m., Pacific time, 50 percent
of the amount remaining shall be distributed as commissions to
thoroughbred associations and racing fairs, as thoroughbred and fair
purses, and as incentive awards in accordance with subparagraph (A),
and the remaining 50 percent, together with the total amount
remaining from advance deposit wagering originating from California
out-of-state and out-of-country harness and quarter horse races
conducted after 6 p.m., Pacific time, shall be distributed as
commissions on a pro rata basis to the applicable licensed quarter
horse association and the applicable licensed harness association,
based upon the amount handled in state, both on- and off-track, on
each breed's own live races in the previous year by that association,
or its predecessor association. One-half of the amount thereby
received by each association shall be retained by that association as
a commission, and the other half of the money received shall be
distributed as purses to the horsemen participating in its current or
next scheduled licensed racing meeting.
   (D) Notwithstanding any provisions of this section to the
contrary, with respect to wagers on out-of-state and out-of-country
nonthoroughbred races conducted before 6 p.m., Pacific time, 50
percent of the amount remaining shall be distributed as commissions
as provided in subparagraph (C) for licensed quarter horse and
harness associations, and the remaining 50 percent shall be
distributed as commissions to the applicable thoroughbred
associations or fairs, as thoroughbred and fair purses, and as
incentive awards in accordance with subparagraph (A).
   (E) Notwithstanding any provision of this section to the contrary,
the distribution of market access fees pursuant to this subparagraph
may be altered upon the approval of the board, in accordance with an
agreement signed by all parties whose distributions would be
affected.
   (g) A racing association, a fair, or a satellite wagering facility
may enter into an agreement with an ADW provider to accept and
facilitate the placement of any wager from a patron at its facility
that a California resident could make through that ADW provider.
Deductions from wagers made pursuant to such an agreement shall be
distributed in accordance with the provisions of this chapter
governing wagers placed at that facility, except that the board may
authorize alternative distributions as agreed to by the ADW provider,
the operator of the facility accepting the wager, the association or
fair conducting that breed of racing in the zone where the wager is
placed, and the respective horsemen's organization.
   (h) Any issues concerning the interpretation or application of
this section shall be resolved by the board.
   (i) Amounts distributed under this section shall be proportionally
reduced by an amount equal to 0.00295 multiplied by the amount
handled on advanced deposit wagers originating in California for each
racing meeting, and shall not exceed two million dollars
($2,000,000). The method used to calculate the reduction in
proportionate share shall be approved by the board. The amount
deducted shall be distributed as follows:
   (1) Fifty percent of the money to the board to establish and to
administer jointly with the organization certified as the majority
representative of California licensed jockeys pursuant to Section
19612.9, a defined contribution retirement plan for California
licensed jockeys who retired from racing on or after January 1, 2009,
and who, as of the date of their retirement, had ridden in a minimum
of 1,250 parimutuel races conducted in California.
   (2) The remaining 50 percent of the money shall be distributed as
follows:
   (A) Seventy percent shall be distributed to supplement the
trainer-administered pension plans for backstretch personnel
established pursuant to Section 19613. Moneys distributed pursuant to
this subparagraph shall supplement, and not supplant, moneys
distributed to that fund pursuant to Section 19613 or any other
provision of law.
   (B) Thirty percent shall be distributed to the welfare fund
established for the benefit of horsemen and backstretch personnel
pursuant to subdivision (b) of Section 19641. Moneys distributed
pursuant to this subparagraph shall supplement, and not supplant,
moneys distributed to that fund pursuant to Section 19641 or any
other provision of law.