SB 398, as amended, Galgiani. Horse racing: distribution of proceeds.
Existing law requires each licensed racing association to designate a certain number of racing days to be conducted as charity days, and requires the net proceeds from those charity days to be distributed to beneficiaries who meet certain qualifications. Existing law also requires distributions to be made to certain nonprofit corporations and organizations, and requires that at least 20% of the distributions go to charities associated with the horse racing industry.
This bill, in addition to those required distributions, would authorize a separate distribution to be made to a nonprofit corporation or trust that has as its sole purpose the support of recognized fairs or the network of California fairs.
Existing law requires that the total percentage deducted from wagers at satellite wagering
facilities in the northern zone be the same as deductions for wagers at the racetrack where the racing meeting is being conducted. Existing law, until December 31, 2013, requires a certain amount to be distributed to a specified organization formed to operate the audiovisual signal system, with the mutual consent of the racing association, the organization representing the horsemen participating in the meeting, and thebegin delete board,end deletebegin insert California Horse Racing Board,end insert and, beginning January 1, 2014, provides for a distribution for those purposes in accordance with a revised method of calculation.
This bill would extend those dates from December 31, 2013, to December 31,begin delete 2019,end deletebegin insert
2016,end insert and from January 1, 2014, to January 1,begin delete 2020,end deletebegin insert
2017,end insert respectively.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 19556 of the Business and Professions
2Code is amended to read:
(a) The distribution shall be made by the distributing
4agent to beneficiaries qualified under this article. For purposes of
5this article, a beneficiary shall be all of the following:
6(1) A nonprofit corporation or organization entitled by law to
7receive a distribution made by a distributing agent.
8(2) Exempt or entitled to an exemption from taxes measured by
9income imposed by this state and the United States.
10(3) Engaged in charitable, benevolent, civic, religious,
11educational, or veterans’ work similar to that of agencies
12recognized by
an organized community chest in the State of
13California, except that the funds so distributed may be used by the
14beneficiary for capital expenditures.
15(4) Approved by the board.
16(b) At least 20 percent of the distribution shall be made to
17charities associated with the horse racing industry. In addition to
18this 20 percent of the distribution, another 5 percent of the
19distribution shall be paid to a welfare fund described in subdivision
20(b) of Section 19641 and another 5 percent of the distribution shall
21be paid to a nonprofit corporation, the primary purpose of which
22is to assist horsemen, horsewomen, and backstretch personnel who
23are being affected adversely as a result of alcohol or substance
24abuse. No beneficiary otherwise qualified under this section to
25receive charity day
net proceeds shall be excluded on the basis
26that the beneficiary provides charitable benefits to persons
27connected with the care, training, and running of racehorses, except
P3 1that type of beneficiary shall make an accounting to the board
2within one calendar year of the date of receipt of any distribution.
3(c) (1) In addition to the distribution pursuant to subdivision
4(b), a separate 20 percent of the distribution shall be made to a
5nonprofit corporation or trust, the directors or trustees of which
6shall serve without compensation except for reimbursement for
7reasonable expenses, and which has as its sole purpose the
8accumulation of endowment funds, the income on which shall be
9distributed to qualified disabled jockeys.
10(2) To receive a distribution under this
subdivision, a corporation
11or trust must establish objective qualifications for disabled jockeys,
12and provide an annual accounting and report to the board on its
13activities indicating compliance with the requirements of this
14subdivision.
15(3) The nonprofit corporation or trust shall, in an amount
16proportional to the contributions received pursuant to this
17subdivision as a percentage of the total contributions received by
18the corporation or trust, give preference in assisting qualified
19disabled jockeys to the following:
20(A) Jockeys who were disabled while participating in the racing
21or training of horses at licensed racing associations or approved
22training facilities in California.
23(B) Jockeys licensed by the board
who were disabled while
24participating in the racing or training of horses in a state other than
25California.
26(d) When the nonprofit corporation or trust described in
27subdivision (c) has received distributions in an amount equal to
28two million dollars ($2,000,000), the distribution mandated by
29subdivision (c) shall cease.
30(e) In addition to the distributions pursuant to subdivisions (b)
31and (c), a separate distribution may be made to a nonprofit
32corporation or trust that has as its sole purpose the support of
33recognized fairs or the network of California fairs.
Section 19605.7 of the Business and Professions Code
35 is amended to read:
The total percentage deducted from wagers at satellite
37wagering facilities in the northern zone shall be the same as the
38deductions for wagers at the racetrack where the racing meeting
39is being conducted and shall be distributed as set forth in this
P4 1section. Amounts deducted under this section shall be distributed
2as follows:
3(a) (1) For thoroughbred meetings, 1.3 percent of the amount
4handled by the satellite wagering facility on conventional and
5exotic wagers shall be distributed to the racing association for
6payment to the state as a license fee, 2 percent shall be distributed
7to the satellite wagering facility as a commission for the right to
8do business, as a franchise, and
this commission is not for the use
9of any real property, 0.54 percent shall be deposited with the
10official registering agency pursuant to subdivision (a) of Section
1119617.2 and shall thereafter be distributed in accordance with
12subdivisions (b), (c) and (d) of Section 19617.2, 0.033 percent
13shall be distributed to the Center for Equine Health, and 0.067
14percent shall be distributed to the California Animal Health and
15Food Safety Laboratory, School of Veterinary Medicine, University
16of California at Davis. It is the intent of the Legislature that the
170.033 percent of funds distributed to the Center for Equine Health
18shall supplement, and not supplant, other funding sources.
19(2) (A) In addition to the distributions specified in paragraph
20(1), for thoroughbred meetings, an amount not to exceed 4 percent
21of the amount handled
by the satellite wagering facility on
22conventional and exotic wagers shall be distributed to an
23organization described in Section 19608.2 with the mutual consent
24of the racing association, the organization representing the
25horsemen participating in the meeting, and the board from January
261, 2010, until December 31,begin delete 2019.end deletebegin insert 2016.end insert However, the amount
27shall be no less than that specified in subparagraph (B), and any
28amount greater than the amount specified in subparagraph (B)
29shall be approved by the board for no more than 12 months at a
30time, and only upon a determination by the board that the greater
31amount is in the economic interest of thoroughbred racing.
32(B) Commencing
January 1,begin delete 2020,end deletebegin insert 2017,end insert an amount not to
33exceed the amount of actual operating expenses, as determined by
34the board, or 2.5 percent of the amount handled by the satellite
35wagering facility on conventional and exotic wagers, whichever
36is less, shall be distributed to an organization described in Section
3719608.2.
38(C) A request to the board for a distribution pursuant to
39subparagraph (A) shall be accompanied by a report detailing all
P5 1receipts and expenditures over the two prior fiscal years of the
2funds affected by the request.
3(D) The racing association whose request pursuant to
4subparagraph (A) has been
approved by the board shall provide
5subsequent quarterly reports of receipts and expenditures of the
6affected funds if requested by the board.
7(b) For harness, quarter horse, Appaloosa, Arabian, or mixed
8breed meetings, 0.4 percent of the amount handled by the satellite
9wagering facility on conventional and exotic wagers shall be
10distributed to the racing association for payment to the state as a
11license fee, for fair meetings, 1 percent of the amount handled by
12the satellite wagering facility on conventional and exotic wagers
13shall be distributed to the fair association for payment to the state
14as a license fee, 2 percent shall be distributed to the satellite
15wagering facility as a commission for the right to do business, as
16a franchise, and this commission is not for the use of any real
17property, and 6 percent of the amount handled by the
satellite
18wagering facility or the amount of actual operating expenses, as
19determined by the board, whichever is less, shall be distributed to
20an organization described in Section 19608.2. In addition, in the
21case of quarter horses, 0.4 percent shall be deposited with the
22official registering agency pursuant to subdivision (b) of Section
2319617.7 and shall thereafter be distributed in accordance with
24subdivisions (c), (d), and (e) of Section 19617.7; in the case of
25Appaloosas, 0.4 percent shall be deposited with the official
26registering agency pursuant to subdivision (b) of Section 19617.9
27and shall thereafter be distributed in accordance with subdivisions
28(c), (d), and (e) of Section 19617.9; in the case of Arabians, 0.4
29percent shall be held by the association to be deposited with the
30official registering agency pursuant to Section 19617.8, and shall
31thereafter be distributed in accordance with
Section 19617.8; in
32the case of standardbreds, 0.4 percent shall be distributed for the
33California Standardbred Sires Stakes Program pursuant to Section
3419619; in the case of thoroughbreds, 0.48 percent shall be deposited
35with the official registering agency pursuant to subdivision (a) of
36Section 19617.2 and shall thereafter be distributed in accordance
37with subdivisions (b), (c), and (d) of Section 19617.2; 0.033 percent
38shall be distributed to the Center for Equine Health; and 0.067
39percent shall be distributed to the California Animal Health and
40Food Safety Laboratory, School of Veterinary Medicine, University
P6 1of California at Davis. It is the intent of the Legislature that the
20.033 percent of funds distributed to the Center for Equine Health
3shall supplement, and not supplant, other funding sources.
4(c) In addition to the
distributions specified in subdivisions (a)
5and (b), for mixed breed meetings, 1 percent of the total amount
6handled by each satellite wagering facility shall be distributed to
7an organization described in Section 19608.2 for promotion of the
8program at satellite wagering facilities. For harness meetings, 0.5
9percent of the total amount handled by each satellite wagering
10facility shall be distributed to an organization described in Section
1119608.2 for the promotion of the program at satellite wagering
12facilities, and 0.5 percent of the total amount handled by each
13satellite wagering facility shall be distributed according to a written
14agreement for each race meeting between the licensed racing
15association and the organization representing the horsemen
16participating in the meeting. If, with respect to harness meetings,
17there are funds unexpended from this 1 percent, these funds may
18be expended for other
purposes with the consent of the horsemen
19and the racing association to benefit the horsemen, or the racing
20association, or both, pursuant to their agreement. For quarter horse
21meetings, 0.5 percent of the total amount handled by each satellite
22wagering facility on races run in California shall be distributed to
23an organization described in Section 19608.2 for the promotion
24of the program at satellite wagering facilities, 0.5 percent of the
25total amount handled by each satellite wagering facility on
26out-of-state and out-of-country imported races shall be distributed
27to the official quarter horse registering agency for purposes of
28Section 19617.75, and 0.5 percent of the total amount handled by
29each satellite wagering facility on all races shall be distributed
30according to a written agreement for each race meeting between
31the licensed racing association and the organization representing
32the horsemen
participating in the meeting.
33(d) Additionally, for thoroughbred, harness, quarter horse, mixed
34breed, and fair meetings, 0.33 percent of the total amount handled
35by each satellite wagering facility shall be paid to the city or county
36in which the satellite wagering facility is located pursuant to
37Section 19610.3 or 19610.4.
P7 1(e) Notwithstanding any other law, a racing association is
2responsible for the payment of the state license fee as required by
3this section.
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