BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 1347|
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THIRD READING
Bill No: AB 1347
Author: Gray (D)
Amended: 9/6/13 in Senate
Vote: 21
SENATE GOVERNMENTAL ORGANIZATION COMMITTEE : 11-0, 6/25/13
AYES: Wright, Nielsen, Berryhill, Calderon, Cannella, Correa,
De Le�n, Galgiani, Hernandez, Lieu, Padilla
ASSEMBLY FLOOR : 77-0, 5/30/13 - See last page for vote
SUBJECT : Horse racing: out-of-state thoroughbred races
SOURCE : Author
DIGEST : This bill adds the "Wood Memorial" to the group of
stake races in Horse Racing Law which are exempt from the
50-race per day limit on imported races.
Senate Floor Amendments of 9/6/13 change existing law to instead
require that the amount remaining from advance deposit wagering
(ADW), as specified, be based on the amount handled in state on
each association's live races, in the previous year by that
association or its predecessor association; and make other
nonsubstantive changes.
ANALYSIS :
Existing law:
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1.Requires the California Horse Racing Board (CHRB) to regulate
the various forms of horse racing authorized in this state.
2.Limits the number of races that may be imported by
associations and fairs to no more than 50 races per day on
days when live thoroughbred or fair racing is being conducted
in this state, with specified exceptions.
3.Exempts, from that 50-race per day limit, races imported that
are part of the race card of certain prominent races,
including the Kentucky Derby, the Kentucky Oaks, the Preakness
Stakes, the Belmont Stakes, the Jockey Club Gold Cup, the
Travers Stakes, the Arlington Million, the Breeders' Cup, the
Dubai Cup, the Arkansas Derby or the Haskell Invitational.
4.Authorizes thoroughbred racing associations or fairs to
distribute the audiovisual signal and accept wagers on the
results of out-of-state and international thoroughbred races
during the calendar period the association or fair is
conducting live racing, including days on which there is no
live racing being conducted by the association or fair.
5.Authorizes ADW to be conducted, with the approval of the CHRB,
in accordance with specified provisions of law.
6.Provides that certain proceeds from ADW originating from
California on out-of-state and out-of-country harness and
quarter horse races conducted after 6 p.m. Pacific time are to
be distributed as commissions on a pro rata basis to the
applicable licensed quarter horse association and 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.
This bill:
1.Adds the "Wood Memorial" to the group of stake races in Horse
Racing Law which are exempt from the 50-race per day limit on
imported races.
2.Requires the amount remaining from ADW, as specified, to be
based on the amount handled in state on each association's
live races in the previous year by that association or its
predecessor association.
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3.Makes other nonsubstantive changes.
Background
The "Wood Memorial" is a nine furlong (1.5 mile) race run on
dirt for three-year-olds at Aqueduct Racetrack in Queens, New
York. In April 2013, the Wood Memorial saw its 90th running and
its purse was set at $1 million - the race was won by Verrazano.
Over the years, 11 Wood Memorial winners have gone on to win
the Kentucky Derby. The Wood Memorial is a premier race that
fits into the character of other races currently exempted in
Horse Racing Law from the importation limit. It was named to
honor Eugene D. Wood, a New York State elected official and
horse racing enthusiast who had been a founder and past
president of the old Jamaica Racetrack, where the race was run
until 1960.
This bill provides that all races imported by a thoroughbred
association or fair that are part of the race card of the
overall Wood Memorial will be exempted from the 50-race per day
limit as defined in existing law. Over the years, this law has
been amended to allow certain notable races to be imported
outside of this cap for promotional and financial reasons.
Satellite wagering. Satellite wagering via an off-track
facility has been legal in California since 1985. It was
authorized at a time when California racetracks were beginning
to experience declining attendance and handle figures. The
industry believed that making the product easier to access not
only would expose and market horse racing to potential
customers, but also would make it more convenient for the
existing patrons to wager more often.
Simulcasting. Simulcasting is the process of transmitting the
audio and video signal of a live racing performance from one
facility to a satellite for re-transmission to other locations
or venues where pari-mutuel wagering is permitted. Simulcasting
provides racetracks with the opportunity to increase revenues by
exporting their live racing content to as many wagering
locations as possible, such as other racetracks, fair satellite
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facilities and Indian casinos. Revenues are increased because
simulcasting provides racetracks that export their live content
with additional customers in multiple locations who would not
have otherwise been able to place wagers on the live racing
event.
Racetrack attendance. Over the past 20 years, the industry has
witnessed a general decline in the number of people attending
and wagering at live horse racetracks in California due to a
number of factors, including increased competition from other
forms of gaming, unwillingness of customers to travel a
significant distance to racetracks and the availability of
off-track wagering. The declining attendance at live horse
racing events has prompted racetracks to rely on revenues from
in-state and out-of-state satellite wagering and account
wagering.
Comments
According to the Senate Governmental Organization Committee,
this bill allows the quarter horse association to increase its
pro rata share of these proceeds by permitting the quarter horse
association to base the calculation on "all" live races
conducted by the quarter association regardless of breed. Since
the quarter horse association is licensed to conduct, and
conducts races on Thoroughbred, Arabian, Appaloosa, and Mules in
addition to Quarter Horses, this will increase the pro rata
share that is allocated and distributed to the quarter horse
association at the expense of the harness racing association.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local:
No
SUPPORT : (Verified 9/9/13)
Los Alamitos Quarter Horse Racing Association
OPPOSITION : (Verified 9/10/13)
California Authority of Racing Fairs
California Exposition and State Fair
Watch and Wager, LLC
ARGUMENTS IN SUPPORT : The author's office notes that this
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bill is intended to help increase the wagering handle on this
specific day (Wood Memorial) which will lead to increased
purses, racetrack revenue, and breeders' awards in California.
Purses are important to California's racing industry because
they provide revenue to horse owners for their racing operations
and to breeders through an increase in the value of their
breeding stock. The author's office states that "California's
racing industry has found that it's much easier to make a big
day bigger relative to their marketing efforts rather than
trying to increase attendance on a typical Wednesday or
Thursday." The author's office believes that this bill will
also provide the racing industry a marketing tool to increase
on-track and off-track attendance on this designated day because
racing fans will want to wager on all the races from the host
track of the prestigious Wood Memorial horse race.
ARGUMENTS IN OPPOSITION : Opponents contend this bill (1)
subverts the administrative process, (2) creates a significant
negative impact to the lessee (Golden Bear Racing), and (3)
jeopardizes future rent payments to Cal Expo. Opponents also
emphasize that a negotiated solution between the parties makes
far more sense than an end-of-session legislative proposal which
is likely to result in a lawsuit.
ASSEMBLY FLOOR : 77-0, 5/30/13
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Bigelow, Bloom,
Blumenfield, Bocanegra, Bonilla, Bonta, Bradford, Brown,
Buchanan, Ian Calderon, Campos, Chau, Ch�vez, 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 Hern�ndez,
Jones, Jones-Sawyer, Levine, Linder, Logue, Lowenthal,
Maienschein, Mansoor, Medina, Melendez, Mitchell, Morrell,
Mullin, Muratsuchi, Nazarian, Nestande, Olsen, Pan, Patterson,
Perea, V. Manuel P�rez, Quirk, Quirk-Silva, Rendon, Salas,
Skinner, Stone, Ting, Wagner, Waldron, Weber, Wieckowski,
Wilk, Williams, John A. P�rez
NO VOTE RECORDED: Holden, Yamada, Vacancy
MW:ej 9/11/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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