BILL NUMBER: AB 2414 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 31, 2010
AMENDED IN SENATE AUGUST 20, 2010
AMENDED IN SENATE AUGUST 17, 2010
AMENDED IN SENATE JUNE 22, 2010
AMENDED IN ASSEMBLY APRIL 15, 2010
INTRODUCED BY Assembly Member John A. Perez
FEBRUARY 19, 2010
An act to add Sections 19601.02 and 19605.74 to, and to
add Article 9.1 (commencing with Section 19604.5) to Chapter 4 of
Division 8 of, the Business and Professions Code, relating to horse
racing, and declaring the urgency thereof, to take effect
immediately. An act to add Section 19604.7 to, and to
repeal Article 9.1 (commencing with Section 19604.5) of Chapter 4 of
Division 8 of, the Business and Professions Code, relating to horse
racing.
LEGISLATIVE COUNSEL'S DIGEST
AB 2414, as amended, John A. Perez. Horse racing:
thoroughbred racing: Breeders' Cup: wagering deduction: promotion:
exchange wagering.
SB 1072 of the 2009-10 Regular Session would enact provisions
relating to exchange wagering, as defined.
This bill would make those provisions inoperative on May 1, 2016,
and would repeal them on January 1, 2017.
This bill would become operative only if SB 1072 of the 2009-10
Regular Session is enacted and this bill is enacted last.
(1) Existing law authorizes a thoroughbred association or fair,
subject to approval by the California Horse Racing Board, to deduct
from the parimutuel pool for any type of wager, a specified
percentage for the meeting of the thoroughbred association or fair
that accepts the wager.
This bill would require every thoroughbred association or fair
that conducts a live race meeting to deduct an additional 2% of the
total amount handled on exotic wagers requiring the selection of 2
wagering interests, and 3% on exotic wagers requiring the selection
of 3 or more wagering interests. The bill would require that these
funds be distributed into the purse account of the meet conducting
racing in the zones in which the wager was placed, to be used to
augment overnight purses.
This bill would require any thoroughbred racing association or
fair that authorizes betting systems located outside of this state to
accept wagers on a race to retain from the total amount received
from the out-of-state betting system, less certain specified
deductions made pursuant to existing law, the incremental amount
received as a result of the 2% or 3% takeout on exotic wagers
required by this bill, for distribution as overnight purses. This
bill would require that the method utilized to determine the
incremental amount received as a result of the takeout increase be
established by agreement between the various affected thoroughbred
racing associations and fairs, and horsemen's organizations. If these
groups are unable to agree as to the method of determining the
incremental amount received, this bill would require the board to
determine the allocation method after holding a hearing.
The bill would provide that these new provisions would become
operative on December 24, 2010.
For a thoroughbred association hosting the Breeders' Cup
Championship series, this bill would require the amounts collected
pursuant to the above provisions requiring that 2% or 3% be deducted
from the amount handled on exotic wagers be set aside for the purpose
of promoting and sponsoring the Breeders' Cup. The bill would
require the thoroughbred racing association hosting the Breeders' Cup
to enter into an agreement with the organization that operates the
Breeders' Cup regarding the expenditure of the funds, as provided,
and would require a written report be made to the board regarding how
the funds were utilized.
(2) Existing law provides that the California Horse Racing Board
shall have all powers necessary to carry out the purposes of the
Horse Racing Law, such as adopting rules and regulations to protect
the public, allocating dates for, and controlling horse racing and
parimutuel wagering, and enforcing all rules and regulations.
This bill would authorize exchange wagering, defined by the bill
as a form of parimutuel wagering in which 2 or more persons place
identically opposing wagers in a given market, provided that the
entity offering exchange wagering is licensed by the board and has
entered into an exchange wagering agreement between the licensee, the
applicable racing association or fair conducting live racing, and
the horsemen's organization responsible for negotiated purse
agreements for the breed on which exchange wagers are accepted, as
provided.
The bill would invest the board with the full power to prescribe
rules, regulations, and conditions under which exchange wagering may
be conducted in California, except that the bill would require the
board to develop rules that prohibit certain persons associated with
an entrant in a particular race from placing an exchange wager on a
race involving that entrant, that prohibit the placing of exchange
wagers on previously run races, that require the exchange wagering
licensee to provide information to the person placing the wager, that
prohibit the use of automatic or quick picks to place an exchange
wager, and that prohibit the displaying of the results of a wager
using casino themes, as provided.
The bill would allow the board to recover any costs associated
with the licensing and regulation of exchange wagering by imposing an
assessment on the licensee. The bill would require that these funds
be deposited in the Horse Racing Fund, to be available upon
appropriation by the Legislature for the sole purpose of regulating
exchange wagering.
(3) Existing law provides that unclaimed refunds from horse racing
are to be distributed to an organization that is responsible for
negotiating business agreements on behalf of horsemen, to be held in
trust for the purpose of negotiating an agreement with a jockeys
organization to provide health and welfare benefits to California
licensed jockeys. Existing law requires that the funds held in trust
shall not exceed $450,000.
Pursuant to the above provision, this bill would require each
exchange wagering licensee to annually distribute the greater of
$100,000, or an amount equal to 0.001 multiplied by the total amount
of exchange revenue collected by the licensee in that year to be used
for the purposes specified above.
By imposing new requirements under the Horse Racing Law, the
violation of which would be a crime, this bill would create new
crimes and would thereby impose a state-mandated local program.
This bill would also authorize the board to require that a
percentage of the takeout that is attributable to the Breeders' Cup
races that otherwise would not have been generated absent the
Breeders' Cup races occurring in this state be made available to
support the statewide marketing organization and the state horse
racing industry.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
This bill would declare that it is to take effect immediately as
an urgency statute.
Vote: 2/3 majority . Appropriation:
no. Fiscal committee: yes. State-mandated local program: yes
no .
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 19604.7 is added to the
Business and Professions Code , to read:
19604.7. This article shall become inoperative on May 1, 2016,
and, as of January 1, 2017, is repealed, unless a later enacted
statute, that becomes operative on or before January 1, 2017, deletes
or extends the dates on which it becomes inoperative and is
repealed.
SEC. 2. Section 1 of this act shall become
operative only if SB 1072 of the 2009-10 Regular Session is enacted,
that bill adds Article 9.1 (commencing with Section 19604.5) to
Chapter 4 of Division 8 of the Business and Professions Code, and
this bill is enacted last. All matter omitted in this version
of the bill appears in the bill as amended in the Senate, August 20,
2010. (JR11)