BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 1074| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 1074 Author: Atkins (D) Amended: 8/12/13 in Senate Vote: 21 SENATE GOVERNMENTAL ORGANIZATION COMMITTEE : 10-0, 6/25/13 AYES: Wright, Nielsen, Berryhill, Calderon, Cannella, De León, Galgiani, Hernandez, Lieu, Padilla NO VOTE RECORDED: Correa SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8 ASSEMBLY FLOOR : 77-0, 5/29/13 - See last page for vote SUBJECT : Horse racing: thoroughbred racing SOURCE : Author DIGEST : This bill extends the sunset date by one year for the statewide marketing organization that is responsible for marketing and promoting thoroughbred and fair horse racing and also makes adjustments to existing Horse Racing Law to pave the way for the California Horse Racing Board (CHRB) to adjust racing dates in the central and southern zones in order to address the scheduling issues resulting from the impending closure of Hollywood Park racetrack. CONTINUED AB 1074 Page 2 ANALYSIS : Existing law: 1.Provides, under the Horse Racing Law, that the CHRB regulate the various forms of horse racing authorized in this state. 2.Authorizes, until January 1, 2014, thoroughbred racing associations, fairs, and the organization responsible for contracting with thoroughbred racing associations and fairs with respect to the conduct of racing meetings, to form a private, statewide marketing organization to market and promote thoroughbred and fair horse racing. If a marketing organization is formed, existing law requires an amount not to exceed 0.25% of the total amount handled by each satellite wagering facility to be distributed to the marketing organization, and imposes certain requirements on the marketing organization, including that the marketing organization annually submit certain information to the CHRB. 3.Provides the CHRB with the authority to allocate racing weeks to an applicant pursuant to the provisions of the Horse Racing Law and to specify such racing days, dates, and hours for horse racing meetings as will be in the public interest. 4.States the CHRB shall make allocations for racing weeks, including simultaneous racing between zones as it deems appropriate. The maximum number of racing weeks that may be allocated for horse racing other than at fairs, are as follows: (a) for thoroughbred racing: 44 weeks per year in the northern zone, 42 weeks per year in the central zone, and seven weeks per year in the southern zone; (b) for harness racing: 25 weeks per year in the northern zone; (c) for quarter horse racing: 25 weeks per year in the northern zone; and (d) for harness racing and quarter horse racing: a total of 77 weeks per year in the combined central and southern zones. 5.Prohibits the CHRB from allocating dates to a thoroughbred association (a) in the central zone for the purpose of conducting racing during daytime hours, and (b) in the southern zone for conducting racing on the same date during CONTINUED AB 1074 Page 3 daytime hours. 6.Specifies that (a) any association licensed to conduct thoroughbred racing in the northern zone may receive no more than 35 weeks of that racing, and (b) any association licensed to conduct thoroughbred racing in the central zone may receive no more than 17 weeks of that racing, except that any association which conducts a split meeting may receive up to 20 weeks of that racing. No more than one such split meeting may be licensed in any one year. 7.Provides the maximum number of racing weeks that may be allocated to a fair shall be for four weeks each, except under specified conditions. This bill extends the sunset date by one year for the statewide marketing organization that is responsible for marketing and promoting thoroughbred and fair horse racing and also makes adjustments to existing Horse Racing Law to pave the way for the CHRB to adjust racing dates in the central and southern zones in order to address the scheduling issues resulting from the impending closure of Hollywood Park racetrack. Specifically, this bill: 1.Extends the sunset date on the statewide marketing organization for one year (from January 1, 2014 to January 1, 2015). 2.Provides that the CHRB may allocate 49 racing weeks per year in the combined central zone and southern zones. 3.Requires the CHRB, from the weeks available in the combined central and southern zones, to allocate a minimum of seven weeks per year to a thoroughbred racing association to conduct thoroughbred racing at a racetrack that was used to conduct a thoroughbred race meeting in the southern zone prior to 2012. (Applicable to Del Mar racetrack for purposes of preserving its traditional racing dates.) 4.Requires the CHRB, from the weeks available in the combined central and southern zones, to allocate a minimum of 25 weeks per year to a thoroughbred racing association to conduct thoroughbred racing at a racetrack that was used to conduct a thoroughbred race meeting in the central zone prior to 2012. CONTINUED AB 1074 Page 4 (Applicable to Santa Anita racetrack for purposes of preserving its traditional racing dates.) 5.Prohibits the CHRB from allocating dates to a thoroughbred association in the southern zone for the purpose of conducting racing if a thoroughbred racing association is conducting racing in the central zone on the same date during daytime hours. 6.Prohibits the allocation of racing dates to a thoroughbred association in the central zone for the purpose of conducting racing if a thoroughbred racing association is conducting racing in the southern zone on the same date during daytime hours. 7.Deletes obsolete provisions of existing Horse Racing Law. Background On May 9, 2013, the CHRB was notified that Hollywood Park Land Company, as well as its affiliated racing associations, would not be requesting the CHRB to allocate any 2014 racing dates at Hollywood Park racetrack in Inglewood. Thus, after 75 years of horse racing, 2013 will be the final year of live racing, training and stabling at Hollywood Park - one of America's premier racing and historic racing venues that hosted Seabiscuit and the first Breeders' Cup. In this regard, the last day of "live" racing at Hollywood Park will be December 22, 2013. The Hollywood Park stable area is expected to close by the end of the year. Although the closure of Hollywood Park was long expected, it did surprise many folks in the national racing industry. From an economic point of view, the land now has a higher and better use and the track's 260-acre footprint will be turned into 3,000 new housing units, including single-family townhomes and condos; 25 acres of parkland, including a 10-acre central park; and a retail and entertainment district, anchored by a movie theatre, office space, and a 300-room hotel. It is the second major California racetrack to close since 2008, when Bay Meadows racetrack in San Mateo was shuttered after 74 years of racing to make way for a similar development. The racing map in California is divided into three zones: northern, central, and southern. For the purposes of thoroughbred racing, Santa Anita and Hollywood Park are in the CONTINUED AB 1074 Page 5 central zone. Del Mar is in the southern zone and Golden Gate Fields is in the northern zone. This bill combines the central and southern zones for purposes of the allocation of racing dates. At its May 23, 2013 meeting, the CHRB responded to the closure of Hollywood Park racetrack and allocated racing dates for 2014 and 2015. Along with the standard fall meet at Santa Anita and the summer meet at Del Mar, the CHRB voted unanimously to award Santa Anita an extended season from December 26, 2013 through July 6, 2014. The CHRB also allocated a five-week fall meet at Del Mar that would run November 5 through December 7. Similar dates were assigned for 2015. Specifically, the 2014 dates the CHRB settled on are as follows: Santa Anita (December 26, 2013 through July 6); Del Mar (July 16 through September 3); Fairplex Park (LA County Fair) (September 4-23); Santa Anita (September 25 through November 2); and Del Mar (November 5 through December 7). The 2015 dates are as follows: Santa Anita (December 26, 2014 through July 5); Del Mar (July 15 through September 7); Fairplex (September 10- 25); Santa Anita (September 26 through October 25); and Del Mar (October 28 through December 6). The shortened 2015 Fairplex is contingent on the selection of Santa Anita to host the 2015 Breeders' Cup. Marketing program . SB 27 (Maddy, Chapter 335, Statutes of 1998), among its provisions, created a private statewide marketing organization for thoroughbred and fair racing that is funded by 0.4% of the in-state off-track handle. The funds generated from this distribution are used to market California horse racing on a statewide basis. The California Marketing Committee 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. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: Yes SUPPORT : (Verified 8/19/13) California Thoroughbred Breeders Association CONTINUED AB 1074 Page 6 Del Mar Fairgrounds Del Mar Thoroughbred Club Oak Tree Racing Association Thoroughbred Owners of California ARGUMENTS IN SUPPORT : According to the author's office, this bill is intended to give the CHRB and the racing industry the maximum flexibility to adjust California's racing calendar to meet the reality of Hollywood Park's closure - it grants the CHRB the flexibility to allocate thoroughbred racing dates in the central and southern zones, while preserving the traditional seven weeks of racing at Del Mar and a minimum of 25 weeks of racing at Santa Anita. This bill extends the sunset date on California's statewide horse racing marketing program until 2015. ASSEMBLY FLOOR : 77-0, 5/29/13 AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Bigelow, Bloom, Blumenfield, Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian Calderon, Campos, Chau, Chávez, Chesbro, Conway, Cooley, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox, Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gorell, Gray, Grove, Hagman, Hall, Harkey, Roger Hernández, Jones, Jones-Sawyer, Levine, Logue, Lowenthal, Maienschein, Mansoor, Medina, Melendez, Mitchell, Morrell, Mullin, Muratsuchi, Nazarian, Nestande, Olsen, Pan, Patterson, Perea, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon, Salas, Skinner, Stone, Ting, Wagner, Waldron, Weber, Wieckowski, Wilk, Williams, Yamada, John A. Pérez NO VOTE RECORDED: Holden, Linder, Vacancy MW:ej 8/20/13 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED