BILL ANALYSIS
SB 1072
Page 1
Date of Hearing: August 12, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
SB 1072 (Calderon) - As Amended: August 2, 2010
Policy Committee: Governmental
Organization Vote: 18 - 0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill extends the sunset for the statewide horseracing
marketing organization from January 1, 2011 to January 1, 2014
and requires the organization to present each November to the
California Horse Racing Board (CHRB) a verbal report on their
statewide marketing plan for the upcoming year. Specifically,
this bill:
FISCAL EFFECT
1)Funding for the California Marketing Committee (CMC) comes
from the instate off-track wagering handle. 0.4% of the
amount wagered is provided to the CMC for marketing horse
racing in the state. In 2009, the CMC received approximately
$5 million for marketing. Extending the sunset would result in
continuing the annual redirection of the handle.
2)Minor and absorbable costs for CMC to produce a semi-annual
report on receipts and expenditures and for CHRB to audit and
review the reports.
COMMENTS
1)Rationale . This bill is intended to create transparency in the
statewide marketing organization by requiring the organization
to present a marketing plan to the CHRB each year and to
submit accounts of their expenditures every six month to the
CHRB. This should provide the board with the information they
need to ensure that the funds are being spent appropriately
and that horse racing in California is being marketed
effectively.
SB 1072
Page 2
2)Statewide Marketing Organization . SB 27 (Maddy; Chapter 335,
Statutes of 1998) created a private statewide marketing
organization for thoroughbred and fair racing funded by 0.4%
of the instate off-track (satellite wagering) handle. The
funds generated from this portion of the takeout are used for
marketing California horse racing throughout the state.
CMC is generally responsible for promoting horse racing in the
state by developing and implementing a marketing plan that
will increase on-track and off-track attendance throughout the
state. An underlying assumption of the CMC's Marketing Plan
is that it is easier to capture a new fan through an on-track
experience than through an off-track visitation to a satellite
wagering facility.
In 2003, the CMC received approximately $6.1 million to
support its marketing efforts but due to reduced handle
revenue, it was reduced to approximately $5 million in 2009.
Current law provides that the CMC must annually submit to the
CHRB a statewide marketing and promotion plan for thoroughbred
and fair horse racing that encompasses all geographical zones
in the state, including the manner in which funds were
expended in the implementation of the plan for the previous
calendar year.
Analysis Prepared by : Julie Salley-Gray / APPR. / (916)
319-2081