BILL NUMBER: SB 2054	CHAPTERED  09/30/00

	CHAPTER   1082
	FILED WITH SECRETARY OF STATE   SEPTEMBER 30, 2000
	APPROVED BY GOVERNOR   SEPTEMBER 30, 2000
	PASSED THE SENATE   AUGUST 25, 2000
	PASSED THE ASSEMBLY   AUGUST 21, 2000
	AMENDED IN ASSEMBLY   JUNE 22, 2000
	AMENDED IN ASSEMBLY   JUNE 20, 2000
	AMENDED IN SENATE   APRIL 24, 2000

INTRODUCED BY   Committee on Governmental Organization (Senators
Perata (Chair), Burton, Chesbro, Dunn, Hughes, Johannessen, Johnson,
Karnette, Lewis, and O'Connell)

                        FEBRUARY 25, 2000

   An act to amend Sections 19403.5, 19405, 19407.5, 19410, 19410.8,
19411, 19412, 19414, 19414.5, 19415.8, 19416.5, 19417.5, 19417.7,
19423, 19424.5, 19428, 19430, 19432, 19435, 19437, 19440, 19441,
19442.2, 19444, 19464, 19480, 19481, 19481.5, 19485, 19487, 19488,
19489, 19490, 19491, 19497, 19510, 19512, 19515, 19516, 19518, 19520,
19521, 19523, 19525, 19530, 19531, 19533, 19535, 19546, 19547,
19548, 19549, 19549.1, 19550, 19556.5, 19565, 19567, 19568, 19569,
19572, 19574, 19577, 19578, 19578.1, 19580, 19581, 19590, 19591,
19592, 19592.5, 19597, 19598, 19599, 19601, 19602, 19605, 19605.1,
19605.2, 19605.3, 19605.51, 19605.6, 19605.7, 19605.71, 19608.5,
19608.6, 19610.2, 19610.4, 19611.5, 19612.6, 19612.8, 19612.9, 19613,
19614, 19614.2, 19636, 19637, 19660, 19662, and 19664 of, to add
Sections 19416.6 and 19540 to, to repeal Sections 19417.9, 19485.5,
19511, 19534, 19541, 19549.5, 19549.10, 19549.11, 19633, and 19634
of, and to repeal and add Section 19417.6 of, the Business and
Professions Code, and to amend Sections 522, 529, and 531 of the Food
and Agricultural Code, relating to horse racing.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 2054, Committee on Governmental Organization.  Horse racing.
   (1) Existing law, the Horse Racing Law, provides for the operation
of live horse racing in this state and for wagering thereon, and for
the operation of satellite wagering facilities, subject to
regulation and oversight by the California Horse Racing Board as
specified.
   This bill would amend the Horse Racing Law by deleting obsolete
provisions, correcting erroneous and outdated cross-references, and
making numerous other technical, nonsubstantive changes.
   (2) Existing law, operative on January 1, 1999, defines breakage
in the context of parimutuel wagering on horse races to mean the odd
cents by which the amount payable on each dollar wagered exceeds a
multiple of 10
.  t   This bill would make technical, nonsubstantive changes to this
provision and would delete related obsolete provisions.
   (3) Existing law requires the board to make an annual report to
the Governor and the Legislature of its proceedings in the preceding
fiscal year, which includes, among other things, a tabulation of
injuries, fatalities, and accident rates and an evaluation of
specified worker safety improvements.
   This bill would require the board to also include a report on the
state of the business of horse racing in its annual report.
   (4) Existing law generally provides that no application to conduct
a race meeting shall be granted unless the applicant has deposited a
surety bond in the amount of $100,000 or greater, as determined by
the board, sufficient to ensure payment of employee wages and
benefits including health, welfare, and pension plans.  Existing law
provides that this requirement does not apply to any person or
association that was licensed to operate a horse racing meeting prior
to January 1, 1986, which conducted a racing meeting in each of the
immediate 3 previous consecutive calendar years.
   This bill would make this exception applicable to any person or
association that was licensed to operate a horse racing meeting prior
to January 1, 2001, that conducted a racing meeting in each of the
immediate 3 previous consecutive calendar years.
   (5) Existing law requires the board to establish safety standards
governing various specified matters, including the track surface,
rails, gates, access and egress, lighting, equipment, communications,
and veterinary, medical, and ambulance services.  Existing law also
provides that no license shall be issued to conduct a horse racing
meeting unless the track has been inspected within 30 days prior to
the date of application and approved by the board with respect to
these standards.  The bill would additionally provide that no license
shall be issued to conduct a racing meeting unless the board
determines that the proposed licensee is in substantial compliance
with its rules and regulations and with the requirements of the Horse
Racing Law.
   (6) Existing law provides that in any city with a population in
excess of 2.75 million persons, no track shall be established in any
flood control basin with specified attributes until the city council
has called a special election on whether the people in the
surrounding area approve of the establishment of that track.
Existing law specifies the precincts and vote requirement for this
election.
   This bill would delete this provision.
   (7) Existing law establishes a stewards' committee to advise the
board with respect to matters relating to stewards and racing
officials.
   This bill would eliminate this committee.
   (8) Existing law provides for the allocation of up to 100 racing
days for the purpose of conducting an Appaloosa invitational meeting,
which may only be held at a racing facility leased from Cal Expo, a
district agricultural fair, or a county fair.
   This bill would delete these provisions, and references thereto.
   (9) Existing law establishes maximum allocation of racing days and
weeks applicable to Appaloosa and Arabian racing.
   This bill would delete these provisions, and would also delete a
redundant authorization for the allocation of 4-day racing weeks to
quarter horse associations.
   (10) Existing law refers to the California Veterinary Diagnostic
Laboratory System and the Equine Drug Testing Laboratory.
   This bill would amend various provisions to instead refer to the
Animal Health and Food Safety Laboratory and the Kenneth L. Maddy
Equine Analytical Chemistry Laboratory, respectively.  This bill
would also amend various provisions to reflect that the Kenneth L.
Maddy Equine Analytical Chemistry Laboratory has been constructed.
   (11) Existing law provides that any racing association in this
state may authorize betting systems located outside of this state to
accept wagers on races it conducts or disseminates, subject to
specified requirements, including a requirement that if the wagers
accepted by the 2 entities are combined in a single parimutuel pool,
the breakage thereby generated shall be allocated between the
entities on the basis of a distribution calculation approved by the
board.  Existing law provides that the board shall report to the
Department of Finance whenever it approves a calculation for
distribution pursuant to these provisions, and the projected impact
of the calculation, if any, on state revenues.
   This bill would delete this reporting requirement.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 19403.5 of the Business and Professions Code is
amended to read:
   19403.5.  "Barrel race" means a horse race around a course with
three barrels placed in a triangular pattern which conforms to the
requirements of the Women's Professional Rodeo Association.  Two
barrel racecourses may be run simultaneously in the form of a heat.

  SEC. 2.  Section 19405 of the Business and Professions Code is
amended to read:
   19405.  "Breakage" means the odd cents by which the amount payable
on each dollar wagered exceeds a multiple of ten cents ($0.10).
  SEC. 3.  Section 19407.5 of the Business and Professions Code is
amended to read:
   19407.5.  "Executive director" means the Executive Director of the
California Horse Racing Board.
  SEC. 4.  Section 19410 of the Business and Professions Code is
amended to read:
   19410.  "Inclosure" means all areas of the racing association's or
fair's grounds and locations, as designated by the racing
association or fair licensed to conduct a live racing meeting and
approved by the board, excluding the public parking lot.
  SEC. 5.  Section 19410.8 of the Business and Professions Code is
amended to read:
   19410.8.  "Show jumping race" means a horse race, over obstacles
made of artificial or natural material, which is shorter than a
steeplechase course, and is run by horses for time with faults
converted to time.  Requirements and rules for a show jumping race
shall conform to the requirements and rules of the American Horse
Shows Association.
  SEC. 6.  Section 19411 of the Business and Professions Code is
amended to read:
   19411.  "Parimutuel wagering" is a form of wagering in which
bettors purchase tickets of various denominations on the outcome of
one or more horse races.  When the outcome of the race or races has
been declared official, the association distributes the total wagers
comprising each pool, less the amounts retained for purposes
specified in this chapter, to winning bettors.
  SEC. 7.  Section 19412 of the Business and Professions Code is
amended to read:
   19412.  (a) "Conventional parimutuel pool" means the total wagers
under the parimutuel system on any horse or horses in a particular
race to win, place, or show.
   (b) "Exotic parimutuel pool" means the total wagers under the
parimutuel system on the finishing position of two or more horses in
a particular race, such as quinella or exacta wagers, or on horses to
win two or more races, such as daily double wagers, pick six wagers,
or on other wagers approved by the board.
   (c) "Proposition parimutuel pool" means the total wagers under the
parimutuel system on propositions approved by the board that are
based on the results of a live quarter horse horse race.  The total
wagers made in the proposition parimutuel pool are subject to the
same licensee fee as exotic wagers on a live quarter horse race, and
commissions and purses shall be distributed in the amounts mutually
agreed upon by the association conducting the meeting and the
organization representing the horsemen and horsewomen.
  SEC. 8.  Section 19414 of the Business and Professions Code is
amended to read:
   19414.  "Quarter horse racing" means that form of horse racing in
which the participating horses are "quarter horses," as defined in
Section 19413.5, and are ridden by jockeys in races over distances of
not more than five and one-half furlongs.
  SEC. 9.  Section 19414.5 of the Business and Professions Code is
amended to read:
   19414.5.  (a) "Racing days" are days on which a licensed racing
association or fair is authorized by the board to conduct horse
racing.
   (b) "Racing weeks" are seven consecutive days during which a
licensed racing association or fair is authorized by the board to
conduct horse racing for a minimum of five racing days.  The board,
however, upon joint petition of the association or fair and the
organization representing horsemen participating in the meeting of
that association or fair, may authorize the conduct of horse racing
for less than five racing days.  Fractional racing weeks of four days
or less may be authorized by the board at the beginning and end of
any horse racing meeting.  Fractional weeks may also be authorized
during weeks containing holidays and during periods of overlap with
thoroughbred meetings and fairs if the total number of weeks
authorized by the board in any calendar year for each breed does not
exceed the maximum annual allocation of racing weeks provided for in
Article 6 (commencing with Section 19530).  If a licensed racing
association holds a split meeting, each part of the split meeting
shall be deemed a horse racing meeting solely for the purposes of
authorizing fractional racing weeks.
  SEC. 10.  Section 19415.8 of the Business and Professions Code is
amended to read:
   19415.8.  "Steeplechase race" means horse racing over obstacles
made of natural or artificial material and includes both hurdle and
timber races.  Rules for a steeplechase race shall conform to rules
of the National Steeplechase and Hunt Association.
  SEC. 11.  Section 19416.5 of the Business and Professions Code is
amended to read:
   19416.5.  "Appaloosa horse" is any horse (including mare, gelding,
colt and filly) that meets the requirements of and is registered by
the Appaloosa Horse Club and approved by the Appaloosa Horse Club.
  SEC. 12.  Section 19416.6 is added to the Business and Professions
Code, to read:
   19416.6.  "Arabian horse" is any horse (including mare, gelding,
colt, and filly) that meets the requirements of and is registered by
the Arabian Horse Registry of America, Inc.
  SEC. 13.  Section 19417.5 of the Business and Professions Code is
amended to read:
   19417.5.  "Appaloosa racing" is the form of horse racing in which
each participating horse is an Appaloosa horse, is mounted by a
jockey, and engages in races on the flat over a distance of not less
than one-quarter of a mile or more than four miles.
  SEC. 14.  Section 19417.6 of the Business and Professions Code is
repealed.
  SEC. 15.  Section 19417.6 is added to the Business and Professions
Code, to read:
   19417.6.  "Arabian racing" is the form of horse racing in which
each participating horse is an Arabian horse, is mounted by a jockey
and engages in races on the flat over a distance of not less than
one-quarter of a mile or more than four miles.
  SEC. 16.  Section 19417.7 of the Business and Professions Code is
amended to read:
   19417.7.  "Paint racing" is the form of horse racing in which each
participating horse is a paint horse, is mounted by a jockey and
engages in races on the flat over a distance of not less than 220
yards or more than four miles.
  SEC. 17.  Section 19417.9 of the Business and Professions Code is
repealed.
  SEC. 18.  Section 19423 of the Business and Professions Code is
amended to read:
   19423.  A person is disqualified from membership on the board if
the person, the person's spouse or any dependent child thereof:
   (a) Holds a financial interest in any horse racing track.
   (b) Holds a financial interest or position of management with any
business entity which conducts parimutuel horse racing.
   (c) Holds a financial interest in a management or concession
contract with any business entity which conducts parimutuel horse
racing.
  SEC. 19.  Section 19424.5 of the Business and Professions Code is
amended to read:
   19424.5.  In order to permit the full participation of horsemen
and horsewomen who may be appointed to the board, the Legislature
declares that the appointment of such persons is intended to
represent and further the interests of horse owners and breeders
pursuant to Section 19401, and that such representation and
furtherance will ultimately serve the public interest.  Accordingly
the Legislature finds racehorse owners and breeders are tantamount to
and constitute the public generally within the meaning of Section
87103 of the Government Code.
  SEC. 20.  Section 19428 of the Business and Professions Code is
amended to read:
   19428.  The board shall appoint an executive director who shall
receive the annual salary established by the board and approved by
the Department of Personnel Administration.  The executive director
shall be the board's executive officer and shall carry out and
execute the duties as specified by law and by the board.
  SEC. 21.  Section 19430 of the Business and Professions Code is
amended to read:
   19430.  The salaries of the executive director, and other
employees of the board, the per diem allowance of members of the
board, and the necessary traveling and other expenses of the
executive director and members of the board, shall be paid monthly by
the Treasurer on the warrant of the Controller and the certification
of the chairperson of the board out of the money appropriated for
that purpose.
  SEC. 22.  Section 19432 of the Business and Professions Code is
amended to read:
   19432.  The executive director shall keep a full and true record
of all proceedings of the board, preserve at the board's general
office all books, documents, and papers of the board, prepare for
service such notices and other papers as may be required of him or
her by the board, and perform such other duties as the board may
prescribe.
  SEC. 23.  Section 19435 of the Business and Professions Code is
amended to read:
   19435.  The board, its executive director, or the stewards, may
issue subpoenas for the attendance of witnesses or the production of
any records, books, memoranda, documents, or other papers or things,
as is necessary to enable any of them to effectually discharge their
duties, and may administer oaths or affirmations as necessary in
connection therewith.
  SEC. 24.  Section 19437 of the Business and Professions Code is
amended to read:
   19437.  Any person who testifies falsely under oath in any
proceeding before, or any investigation by the board, its executive
director, or the stewards, is guilty of a felony and shall be
punished in the same manner prescribed by the Penal Code for the
punishment of perjury.
  SEC. 25.  Section 19440 of the Business and Professions Code is
amended to read:
   19440.  (a) The board shall have all powers necessary and proper
to enable it to carry out fully and effectually the purposes of this
chapter.  Responsibilities of the board shall include, but not be
limited to, all of the following:
   (1) Adopting rules and regulations for the protection of the
public and the control of horse racing and parimutuel wagering.
   (2) Administration and enforcement of all laws, rules, and
regulations affecting horse racing and parimutuel wagering.
   (3) Adjudication of controversies arising from the enforcement of
those laws and regulations dealing with horse racing and parimutuel
wagering.
   (4) Licensing of each racing association and all persons, other
than the public at large, who participate in a horse racing meeting
with parimutuel wagering.
   (5) Allocation of racing dates to qualified associations in
accordance with law.
   (b) The board may delegate to stewards appointed pursuant to
Article 5 (commencing with Section 19510) any of its powers and
duties that are necessary to carry out fully and effectuate the
purposes of this chapter.
  SEC. 26.  Section 19441 of the Business and Professions Code is
amended to read:
   19441.  The board shall annually make a full report to the
Governor and the Legislature of its proceedings and the state of the
business of horse racing for the preceding fiscal year, on or before
January 31, and shall embody therein any recommendations deemed
needed for improved functioning of the horse racing laws.
  SEC. 27.  Section 19442.2 of the Business and Professions Code is
amended to read:
   19442.2.  The board shall, if possible, designate at least one
steward at each track where a horse racing meeting is conducted who
is a former jockey or at least one steward at each track where a
harness meeting is conducted who is a former driver.
  SEC. 28.  Section 19444 of the Business and Professions Code is
amended to read:
   19444.  In performing its responsibilities pursuant to this
chapter, the board may do the following:
   (a) Pay membership fees, join, and participate in the affairs of
associations having for their purpose the interchange of information
relating to racing law enforcement, the licensing of horse racing
participants, the registration of race horses, and subjects relating
to the duties of the board.
   (b) Tabulate, analyze, and publish statistical information based
upon parimutuel handles, attendance, distribution of parimutuel
proceeds among fees, commissions, purses, and awards, and upon the
breeding and production of race horses or other information relating
to parimutuel wagering.
   (c) Conduct research to determine more fully the cause and
prevention of horse racing accidents, the effects of drug substances
on the race horses, and the means for detection of foreign drug
substances.
  SEC. 29.  Section 19464 of the Business and Professions Code is
amended to read:
   19464.  (a) No application for a horse owner's license or for a
license to conduct a race meeting shall be granted unless the
applicant's liability for workers' compensation is secured in
accordance with Division 4 (commencing with Section 3700) of the
Labor Code.  Any termination of security for that liability during
the period of a license shall result in the immediate automatic
suspension of the license during the period of that termination and
also shall be a ground for revocation of the license.
   (b) No application for a license to conduct a race meeting shall
be granted unless the applicant has deposited with the board a surety
bond in the amount of one hundred thousand dollars ($100,000), or a
greater amount, as determined by the board, which is sufficient to
ensure payment of employee wages and benefits including, but not
limited to, health, welfare, and pension plans.  The surety bond
shall be maintained during the period of the meeting and for an
additional period, as determined by the board, sufficient to assure
that all payments are made.  In the event of a dispute over the
amount owed, the dispute shall be resolved through the grievance
procedures set forth in the labor agreement of the union representing
the class of employees affected.
   For the purposes of this subdivision, an insured certificate of
deposit payable to the Treasurer of the State of California shall be
considered equivalent to a surety bond and shall be acceptable to the
board upon such terms and conditions as it may prescribe.  Interest
paid to the state on the certificate of deposit shall be refunded to
the applicant.
   This subdivision does not apply to any person or association
licensed to operate a horse race meeting prior to January 1, 2001,
which has conducted a race meeting in each of the immediate three
previous consecutive calendar years.
  SEC. 30.  Section 19480 of the Business and Professions Code is
amended to read:
   19480.  The board may issue to any person who makes application
therefor in writing, who has complied with the provisions of this
chapter, and who makes the deposit to secure payment of the license
fee imposed by this article, a license to conduct a horse racing
meeting in accordance with this chapter at the track specified in the
application; provided, the board determines that the issuance
thereof will be in the public interest and will subserve the purposes
of this chapter.
  SEC. 31.  Section 19481 of the Business and Professions Code is
amended to read:
   19481.  In performing its responsibilities, the board shall do all
of the following:
   (a) Establish safety standards governing the uniformity and
content of the track base and racing surface, inner and outer rails,
gates and gaps, turf, access and egress to the track, lighting for
night racing, equipment for horse and rider, drainage,
communications, veterinary services, medical and ambulance services,
and other track facilities in order to improve the safety of horses,
riders, and workers at the racetrack.
   (b) Designate a steward at all horse racing meetings to be
responsible for enforcing compliance with safety standards.
  SEC. 32.  Section 19481.5 of the Business and Professions Code is
amended to read:
   19481.5.  Notwithstanding any other provision of law, no license
shall be issued to conduct a horse racing meeting unless the track
has been inspected by the board within 30 days prior to the date of
application for a license and the track has been approved by the
board as conforming to the racetrack safety standards set forth in
subdivision (a) of Section 19481, and the board determines that the
proposed licensee is in substantial compliance with all of the rules
and regulations of the board and the provisions of this chapter.
  SEC. 33.  Section 19485 of the Business and Professions Code is
amended to read:
   19485.  The board shall not issue a license to conduct a horse
racing meeting at any place, track or inclosure, not used for horse
racing meetings prior to July 1, 1941, unless prior to the beginning
of the construction or preparation of such track for horse racing
meetings, the board, upon application in such form as it may require,
has determined that the conduct of horse racing meetings at such
track will be in the public interest and will subserve the purposes
of this chapter.
   This section does not apply in respect to any track of not less
than five-eighths of one mile in circumference or length partially or
entirely in the infield of a mile track constructed and operated by
a thoroughbred licensee under this article provided that such infield
track is to be used solely for thoroughbred racing.
  SEC. 34.  Section 19485.5 of the Business and Professions Code is
repealed.
  SEC. 35.  Section 19487 of the Business and Professions Code is
amended to read:
   19487.  Notwithstanding Section 19485, any licensed racing
association operating a racetrack may construct another track of not
less than one-half mile in circumference or length partially or
entirely in the infield of such track, if prior to the beginning of
construction or preparation of such track for horse race meetings,
the board has determined upon application, in such form as it may
require, that the conduct of horse race meetings at such track will
be in the public interest and subserve the purposes of this chapter.
A license may be granted to any harness racing association to
conduct a harness racing meeting upon such a track of less than one
mile.
  SEC. 36.  Section 19488 of the Business and Professions Code is
amended to read:
   19488.  (a) Every license issued under this article shall specify
the following:
   (1) The name of the person to whom it is issued.
   (2) The track where the horse racing meeting to which it relates
is to be held or conducted.
   (3) The days and hours of the day when the meeting will be
permitted.
   (4) The number and types of races to be run on each day of the
meeting.
   (5) The number of useable stalls available for the meeting.
   (6) The name of the person responsible for supervising the
maintenance of racetrack safety standards.
   (b) The license shall also recite the payment to, and receipt by,
the board of the deposit to secure payment of the license fee
required by this article.
  SEC. 37.  Section 19489 of the Business and Professions Code is
amended to read:
   19489.  A license issued under this article is not transferable
nor does it permit the conduct of a horse racing meeting at any track
not specified therein.
   If, however, the track specified in a license becomes unsuitable
for racing because of fire, flood, or other catastrophe, the meeting
or any remaining portion thereof may be conducted at any other track
specified by the board in the same area.  The board may specify any
other track within the area for the conduct of the meeting, whether
or not such conduct would result in increasing the number of racing
days in the county or area in which such track is situated.  Before
any other track is so specified, the board shall obtain the consent
of the person licensed to conduct a meeting at the track which has
become unsuitable for racing and of the owners and operators licensed
to conduct a meeting at such other track.
  SEC. 38.  Section 19490 of the Business and Professions Code is
amended to read:
   19490.  Each application for a license to conduct a horse racing
meeting shall be accompanied by a deposit to secure the payment of
any license fee imposed by this article, in the form of a certified
check payable to the Treasurer of the State of California, in the
amount of ten thousand dollars ($10,000).
  SEC. 39.  Section 19491 of the Business and Professions Code is
amended to read:
   19491.  (a) Subject to Sections 19491.5 and 19491.6, and except as
provided in Section 19491.7, every association which conducts a
racing meeting shall pay as an additional license fee one-half of the
breakage deducted pursuant to Section 19597 on the first twenty-four
million dollars ($24,000,000) or less, excluding wagering at a
satellite wagering facility, of the total amount handled in the
parimutuel pools relating to its meeting and all of the breakage
deducted on amounts so handled in excess of twenty-four million
dollars ($24,000,000), excluding wagering at a satellite wagering
facility.
   (b) Every association which conducts a racing meeting shall
distribute the remaining one-half of the breakage deducted pursuant
to Section 19597 on the first twenty-four million dollars
($24,000,000) or less, excluding wagering at a satellite wagering
facility, of the total amount handled in the parimutuel pools
relating to the meeting as additional purses and for additional
commissions in the same proportion, as between purses and
commissions, as provided in Sections 19611, 19612, 19612.6, and
19614.
   (c) Notwithstanding subdivision (b), one-half of all the breakage
deducted pursuant to Section 19597 at fair racing meetings shall be
retained and distributed as additional commissions.
   Payment of the fee shall be made weekly on account during each
meeting, and the amount attributable to breakage shall be reported as
a separate item.
  SEC. 40.  Section 19497 of the Business and Professions Code is
amended to read:
   19497.  Any person who is licensed to conduct a horse racing
meeting at any place, track or inclosure which is leased by him from
the state, shall not transfer any such property to any other person,
whether licensed under this chapter or not, for the purpose of
furnishing such other person a place, track or inclosure at which it
may conduct a horse racing meeting, unless such transfer is first
submitted to the Department of General Services and the department
finds that its terms and provisions are just and reasonable and
approves of it.
   As used in this section, "transfer" includes any sublease, permit
to use, license to use, and any other transaction or arrangement of
any kind or nature whereby any right to the use or possession of
property, or any part thereof, for the purpose of conducting a horse
racing meeting is conferred upon any person.
   The provisions of this section which are applicable to a person
licensed under this chapter to conduct a horse racing meeting shall
also apply to any person to whom a transfer is made by such a
licensee in accordance with this section.
  SEC. 41.  Section 19510 of the Business and Professions Code is
amended to read:
   19510.  (a) Every steward and racing official not required to be
licensed under Article 4 (commencing with Section 19480) shall be
licensed by the board pursuant to this article.  Any license issued
pursuant to this article shall include a current photograph of the
licensed person.
   (b) No person required to be licensed pursuant to this article may
participate in any capacity in any horse race meeting without a
valid and unrevoked license.  The board shall determine the fixed
license fee which shall be paid in order to receive a license
pursuant to this article.
   (c) As used in this section, "racing official" means the starter,
timer, paddock judge, horseshoe inspector, horse identifier, official
veterinarian, racing veterinarian, associate judge, placing judge,
patrol judge, clerk of scales, clerk of the course, and any other
person acting as an official at any horse racing meeting.
  SEC. 42.  Section 19511 of the Business and Professions Code is
repealed.
  SEC. 43.  Section 19512 of the Business and Professions Code is
amended to read:
   19512.  (a) The board shall require applicants for license as a
steward to pass both a written and an oral examination.
   (b) The board may admit to examination any person who meets all of
the following qualifications:
   (1) Has not been convicted of a crime involving moral turpitude or
of a felony.
   (2) Has been given a physical examination by a licensed physician
and surgeon within 60 days prior to the date of application for the
steward's examination, indicating at least 20-20 vision or vision
corrected to at least 20-20, and normal hearing ability.
   (3) Possesses at least one of the following qualifications:
   (A) Has at least five years of experience in the parimutuel horse
racing industry as a licensed trainer, jockey, or driver.
   (B) Has at least 10 years of experience in the California
parimutuel horse racing industry as a licensed owner whose
experience, knowledge, ability, and integrity relative to the
industry are known to the board.
   (C) Has at least three years of experience as a licensed racing
official, racing secretary, assistant racing secretary, or director
of racing.
   (D) Has experience in the horse racing industry of a character and
for a length of time sufficient, as determined by the board, to
qualify the person as having experience substantially equivalent to
the experience described in subparagraph (A), (B), or (C).
  SEC. 44.  Section 19515 of the Business and Professions Code is
amended to read:
   19515.  An original license issued under this article shall be
issued for a period of the calendar year in which it is issued, and
shall be renewable for a period, not to exceed three years, which the
board may, by regulation, establish.  The board may establish a
license fee schedule consistent with the different period for which
these licenses may be granted.
   The license shall be valid at all horse racing meetings in this
state during the period for which it is issued, unless it is
suspended or revoked prior to the expiration of the period.
               SEC. 45.  Section 19516 of the Business and
Professions Code is amended to read:
   19516.  The board may, at any time, require the removal of any
racing official or employee in any case where it has reason to
believe that the official or employee has been guilty of any
dishonest practice in connection with horse racing, has failed to
comply with any condition of the licensee's license, or has violated
any law or any rule or regulation of the board.
  SEC. 46.  Section 19518 of the Business and Professions Code is
amended to read:
   19518.  (a) (1) The board shall contract with persons licensed as
stewards pursuant to this article to perform the duties of stewards
at horse racing meets.  Contracts shall be upon any terms that the
board and the stewards may mutually agree upon and may contain
different rates of compensation based upon the experience of the
steward.
   (2) The board shall establish a committee of at least two board
members to meet at least quarterly with representatives of the
stewards, so that recommendations of the stewards can be discussed as
necessary.  These meetings may be scheduled the same day as regular
board meetings or at the convenience of the board.  Representatives
of associations may attend and participate in these meetings, or
portions thereof, when items directly affecting the associations are
discussed.
   (3) The board shall provide remuneration, including any fringe
benefits, to stewards, to the official veterinarian, and for the
costs of laboratory testing relating to horse racing.
   (b) Stewards and other racing officials appointed or approved by
the board, and while performing duties required by this chapter or by
the board, shall be entitled to the same rights and immunities
granted public employees by Article 3 (commencing with Section 820)
of Chapter 1 of Part 2 of Division 3.6 of Title 1 of the Government
Code.
   (c) The Legislature finds and declares that the services performed
by stewards at horse racing meetings are unique and cannot be
performed adequately, competently, or satisfactorily by civil service
personnel, and that the services cannot be adequately rendered by an
existing public agency and do not duplicate the function of an
existing public agency.  Stewards shall be personal service
contractors of the board and shall not be civil service employees.
  SEC. 47.  Section 19520 of the Business and Professions Code is
amended to read:
   19520.  (a) Every person not required to be licensed under Article
4 (commencing with Section 19480) who participates in, or has
anything to do with, the racing of horses, including a horse owner,
jockey, driver, apprentice, exercise rider, agent trainer, stable
foreman, groom, valet, horseshoer, stable watchman, and every
employee of a parimutuel department, shall be licensed by the board
pursuant to rules and regulations that the board may adopt, and upon
the payment of a license fee fixed and determined by the board.  Any
license issued pursuant to this article shall include a current
photograph of the licensed person.
   (b) No person required to be licensed by this article may
participate in any capacity in any horse race meeting without a valid
and unrevoked license authorizing the participation.
  SEC. 48.  Section 19521 of the Business and Professions Code is
amended to read:
   19521.  An original license issued pursuant to this article shall
be issued for a period of the calendar year in which it is issued,
and shall be renewable for a period, not to exceed three years, which
the board may, by regulation, establish.  The board may establish a
license fee schedule consistent with the different period for which
the licenses may be granted.  The license shall be valid at all horse
racing meetings in this state during the period for which it is
issued, unless it is suspended or revoked prior to the expiration of
the period.
  SEC. 49.  Section 19523 of the Business and Professions Code is
amended to read:
   19523.  The board may, at any time, require the removal of any
racing official or employee in any case where it has reason to
believe that the official or employee has been guilty of any
dishonest practice in connection with horse racing, has failed to
comply with any condition of the licensee's license, or has violated
any law or any rule or regulation of the board.
  SEC. 50.  Section 19525 of the Business and Professions Code is
amended to read:
   19525.  No licensee or any other person may receive a commission,
fee, gratuity, or any other form of compensation in connection with
the sale or purchase of a racehorse, prospective racehorse, stallion,
or broodmare, unless the purchaser and seller have agreed in writing
to the payment of the commission, fee, gratuity, or other
compensation.  No contract or agreement shall be enforceable by way
of an action or defense unless there is a writing sufficient to
indicate that the party against whom enforcement is sought or his or
her authorized agent or broker has agreed to the commission, fee,
gratuity, or other form of compensation.  Anyone who receives a
commission, fee, gratuity or any other form of compensation in
violation of this section is subject to treble damages to the injured
purchaser or seller.  The board may suspend or revoke the license of
any person who violates this section.  Any transfer of an interest
in a racehorse, prospective racehorse, stallion, or broodmare shall
be accompanied by a written bill of sale setting forth the purchase
price.
  SEC. 51.  Section 19530 of the Business and Professions Code is
amended to read:
   19530.  The board shall have the authority to allocate racing
weeks to an applicant or applicants pursuant to the provisions of
this article and Article 6.5 (commencing with Section 19540) and to
specify such racing days, dates, and hours for horse racing meetings
as will be in the public interest, and will subserve the purposes of
this chapter.  The decision of the board as to such racing days,
dates, and hours shall be subject to change, limitation or
restriction only by the board.  No municipality or county shall adopt
or enforce any ordinance or regulation which has or may have the
effect of directly or indirectly regulating, limiting or restricting
the racing days and dates of horse racing meetings.
  SEC. 52.  Section 19531 of the Business and Professions Code is
amended to read:
   19531.  The board shall make allocations of 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, shall be 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.
   (d) For harness racing and quarter horse racing:  a total of 77
weeks per year in the combined central and southern zones.
   (e) In its written application for a license, an applicant shall
state the time of day, consistent with this chapter, during which it
will conduct its racing meeting, and particularly the first race
starting time for the various racing days.  After receiving a
license, a licensee shall not change the first race starting time
without securing prior approval of the board.
   (f) Notwithstanding this section or any other provision in this
chapter, the board shall not allocate dates to a thoroughbred
association in the central zone for the purpose of conducting racing
during daytime hours if a thoroughbred racing association is
conducting racing in the southern zone on the same date during
daytime hours.
  SEC. 53.  Section 19533 of the Business and Professions Code is
amended to read:
   19533.  (a) Any license granted to an association other than a
fair shall be only for one type of racing, thoroughbred, harness, or
quarter horse racing as the case may be, except that the board may
authorize the entering of thoroughbred and Appaloosa horses in
quarter horse races at a distance not exceeding five furlongs at
quarter horse meetings, mixed breed meetings, and fair meetings.  If
the board authorizes the entering of thoroughbred or Appaloosa horses
in quarter horse races, the following conditions shall be met:
   (1) Any race written for participation by quarter horses,
Appaloosas, and thoroughbreds shall be written as quarter horse
preferred.
   (2) The number of races written as quarter horse preferred at a
distance exceeding 870 yards shall not exceed more than three races
per program without the consent of the quarter horse horsemen's
organization contracting with the association.
   (3) More than one-half of the races on any program shall be for
quarter horses at a distance not to exceed 550 yards, unless the
consent of the quarter horse horsemen's organization is received.
   (4) Mixed races with Appaloosa and quarter horses may only be
written with the consent of the quarter horse horsemen's organization
contracting with the association.
   (b) The association that conducts the meeting shall pay to a
thoroughbred trainers' organization an amount for a pension plan for
backstretch personnel to be administered by that trainers'
organization equivalent to 1 percent of the amount available to
thoroughbred horses for purses.  The remainder of the portion shall
be distributed as purses.  Any redistributable money paid to the
board pursuant to Section 19641, which is paid to a welfare fund
established by a horsemen's organization from races with both
thoroughbred and quarter horses, shall be divided pro rata between
the two welfare funds based on the number of thoroughbreds and
quarter horses in the race.
   (c) (1) Notwithstanding any other provision of law, any
association licensed to conduct quarter horse racing may apply to the
board for, and the board shall grant, authority to conduct
thoroughbred racing as part of its racing program if all of the
following conditions are met:
   (A) The thoroughbred races are for a claiming price of not more
than five thousand dollars ($5,000), and at a distance of four and
one-half furlongs or less.  The races may not be stakes, allowance
races, or maiden allowance races.
   (B) More than one-half of the races on any program shall be for
quarter horses at a distance not to exceed 550 yards, unless the
consent of the quarter horse horsemen's organization is received.
   (C) The consent of the quarter horse horsemen's organization
contracting with the association is obtained with respect to the
inclusion of thoroughbred racing.
   (2) The quarter horse racing association conducting thoroughbred
racing pursuant to this subdivision shall pay to a quarter horse
horsemen's organization the amount specified in subdivision (e) of
Section 19613, and an amount for a pension plan for backstretch
personnel to be administered by a thoroughbred trainers' organization
equivalent to 1 percent of the amount available to thoroughbred
horses for purses.  The remainder of the portion shall be distributed
as purses.  The quarter horse racing association shall also deduct
the appropriate amount to comply with subdivision (a) of Section
19617.2 for distribution to the thoroughbred official registering
agency.
  SEC. 54.  Section 19534 of the Business and Professions Code is
repealed.
  SEC. 55.  Section 19535 of the Business and Professions Code is
amended to read:
   19535.  (a) Notwithstanding any other provision of law, at the
time the board allocates racing weeks, it shall determine the number
of useable stalls that each association or fair shall make available
and maintain in order to conduct the racing meeting.  The minimum
number of stalls may be at the site of the racing meeting or at
board-approved offsite locations.
   (b) With respect to racing meetings conducted in the northern
zone, the association or fair conducting the meeting shall provide
all stabling required by the board pursuant to subdivision (a)
without cost to participating horsemen.  Offsite stabling shall be at
a board approved facility or facilities selected by the association
or fair, with the agreement of the organization representing horsemen
participating at the meeting.  If there is a disagreement between
the association or fair and the organization representing the
majority of horsemen participating at the meeting with respect to the
selection of offsite stabling facilities, the board, at the request
of the association or fair or the organization representing the
majority of horsemen participating at the meeting, shall promptly
determine the board-approved facility or facilities at which offsite
stabling shall be made available.  The organization representing
horsemen participating at the meeting and the association or fair
shall mutually agree on the criteria and selection of horses that may
use stalls required pursuant to this section.  With respect to
northern zone thoroughbred meetings only, the association shall also
provide, at the option of the horse owner, vanning of participating
racehorses from any board-approved offsite stabling facility in the
northern zone.  Fairs may provide, subject to the availability of
funds pursuant to Sections 19607, 19607.1, 19607.2, and 19607.3, at
the option of the horse owner, vanning of participating racehorses
from any board-approved offsite stabling facility.
   (c) With respect to racing meetings conducted in the central or
southern zones, all costs associated with the maintenance of the
useable stalls for the racing meeting shall be borne by the
association or fair conducting the meeting, and, with respect to
useable stalls at an offsite location, the association or fair may be
required, by order of the board, to bear the costs of vanning from
the offsite location to the racing meeting.  However, with respect to
any racing association in the central or southern zone that
conducted a racing meeting in 1986, if the number of useable stalls
made available onsite by a racing association during a racing meeting
is less than 95 percent of the number of useable stalls made
available onsite by that racing association during its 1986 racing
meeting, the racing association shall reimburse the facility
providing offsite stabling for the difference in cost between the
actual number of useable stalls made available and 95 percent of the
useable stalls made available in 1986.
   The racing association shall, in addition, reimburse the owner for
vanning to the onsite location with respect to those horses stabled
at an offsite location necessitated by the failure of a racing
association to maintain 95 percent of the useable stalls made
available by that racing association during its 1986 racing meeting.

  SEC. 56.  Section 19540 is added to the Business and Professions
Code, to read:
   19540.  In order to encourage and develop the racing of all horses
in California, regardless of breed, whenever a state designated fair
conducts a program of horse races on which there is parimutuel
wagering, the fair, so far as practicable, shall provide a program of
racing that includes thoroughbred racing, quarterhorse racing,
Arabian racing, and Appaloosa racing, if a sufficient number of
horses are available to provide competition in one or more races.
  SEC. 57.  Section 19541 of the Business and Professions Code is
repealed.
  SEC. 58.  Section 19546 of the Business and Professions Code is
amended to read:
   19546.  (a) In order to encourage and develop the racing of all
horses in California, regardless of breed, whenever a fair conducts a
program of parimutuel wagering, it may provide a program of mixed
breed racing that includes thoroughbred racing, harness racing,
quarter horse racing, Arabian racing, paint racing, Appaloosa racing,
steeplechase races, barrel races, and show jumping races.
   (b) All recognized breeds of horses may compete in barrel races,
show jumping races, and steeplechase races.  Parimutuel wagering may
be conducted on barrel races, show jumping races, and steeplechase
races at any public or private facility that has been approved and
licensed by the board.
  SEC. 59.  Section 19547 of the Business and Professions Code is
amended to read:
   19547.  Notwithstanding Section 19490, no deposit shall be
required for any horse racing meeting conducted by a state designated
fair.
  SEC. 60.  Section 19548 of the Business and Professions Code is
amended to read:
   19548.  Except as provided in this chapter, no license, tax, or
fee shall be assessed against or collected from any fair which,
directly and not through any private person, conducts a horse racing
meeting.
  SEC. 61.  Section 19549 of the Business and Professions Code is
amended to read:
   19549.  Except as provided in Section 19549.1, the maximum number
of racing days that may be allocated to a fair shall be 14 days each
year.  Those racing days shall be days during the period in which
general fair activities are conducted.  However, any fair racing
association that conducted racing in the central or southern zone
prior to January 1, 1980, shall be entitled to be allocated up to
three weeks of racing.  The board shall take public testimony and
make all determinations on the allocation of racing dates during a
public hearing.  All discussions of allocating racing dates by the
board or its subcommittees shall be conducted during a public
hearing.  Nothing in this section diminishes the authority of the
board to establish racing dates.
  SEC. 62.  Section 19549.1 of the Business and Professions Code is
amended to read:
   19549.1.  Notwithstanding Sections 19533 and 19549 or any other
provision of this chapter, the board may allocate horse racing days
for mixed breed meetings and combined fair horse racing meetings
pursuant to Section 4058 of the Food and Agricultural Code, except as
follows:
   (a) Dates may only be allocated for a combined fair horse racing
meeting between July 1 and October 31, and the total combined number
of dates shall not exceed the total combined dates of the combined
fair racing associations in 1995.
   (b) Days may not be allocated for a mixed breed meeting or a
combined fair horse racing meeting during the month of June at the
California Exposition and State Fair if a standardbred meeting is
being conducted at that facility during the month of June.
   The mixed breed meetings shall be conducted by a person other than
the fair and shall be subject to Section 19550.  The mixed breed
meetings shall encourage the racing of emerging breeds of horses.
  SEC. 63.  Section 19549.5 of the Business and Professions Code is
repealed.
  SEC. 64.  Section 19549.10 of the Business and Professions Code is
repealed.
  SEC. 65.  Section 19549.11 of the Business and Professions Code is
repealed.
  SEC. 66.  Section 19550 of the Business and Professions Code is
amended to read:
   19550.  (a) The board shall require each licensed racing
association that conducts 14 or less weeks of racing to designate 3
racing days, and each licensed racing association that conducts more
than 14 weeks of racing to designate five racing days during any one
meeting, to be conducted as charity days by the licensee for the
purpose of distribution of the net proceeds therefrom to
beneficiaries through the distributing agent. For the purposes of
this section, a split meeting shall be considered a single meeting
and the appropriate number of charity days shall be based on the
total weeks of racing allocated for both periods of the meeting.
   (b) Notwithstanding subdivision (a) or any other provision of law,
no racing association shall be required to pay to a distributing
agent for the purpose of distribution to beneficiaries more than an
amount equal to two-tenths of 1 percent of the association's total
on-track handle on live races conducted by the association at the
meeting.
   (c) This section does not apply to a fair, or to a licensed racing
association conducting three weeks of racing or less.
  SEC. 67.  Section 19556.5 of the Business and Professions Code is
amended to read:
   19556.5.  The board shall designate a nonprofit organization that
is dedicated to research and development of improved safety standards
for horse racing as a beneficiary qualified to receive a
distribution pursuant to this article.
  SEC. 68.  Section 19565 of the Business and Professions Code is
amended to read:
   19565.  Subject to the provisions of this article, the board shall
by rule provide for the registration of all California-bred horses.

  SEC. 69.  Section 19567 of the Business and Professions Code is
amended to read:
   19567.  (a) Since the purpose of this chapter is to encourage
agriculture and the breeding of horses in this state, a sum equal to
10 percent of the first money of every purse won by a California-bred
horse at a horse race meeting shall be paid by the licensee
conducting the meeting to the breeder of the horse.  This section
applies to any California-bred standardbred horse that is foaled on
or after November 1, 1977, for all races, except the California
standardbred sires stakes races.
   (b) Notwithstanding subdivision (a), a sum equal to 10 percent of
the first and second place money of every purse won by a
California-bred Arabian horse for first or second place at a horse
race meeting shall be deposited with the official registering agency,
pursuant to subdivision (b) of Section 19617.8, and shall thereafter
be distributed in accordance with subdivisions (c) to (g),
inclusive, of Section 19617.8.
   (c) Moneys from quarter horse racing derived pursuant to this
section shall be deposited with the official registering agency
pursuant to subdivision (b) of Section 19617.7 and shall thereafter
be distributed in accordance with subdivisions (c), (d), and (e) of
Section 19617.7.
   (d) Moneys from Appaloosa horse racing derived pursuant to this
section shall be deposited with the official registering agency
pursuant to subdivision (b) of Section 19617.9 and shall thereafter
be distributed in accordance with subdivisions (c) and (d) of Section
19617.9.
   (e) This section does not apply to thoroughbred horses or
thoroughbred racing.
  SEC. 70.  Section 19568 of the Business and Professions Code is
amended to read:
   19568.  (a) Every licensee conducting a horse racing meeting
shall, each racing day, provide for the running of at least one race
limited to California-bred horses, to be known as the
"California-bred race."  If, however, sufficient competition cannot
be had among horses of that class on any day, the race, with the
consent of the board, may be eliminated for that day and a substitute
race provided.
   (b) For thoroughbred and quarter horse racing only, the total
amount distributed to horsemen and horsewomen for California-bred
stakes races from the purse account, including overnight stakes,
shall be not less than 10 percent of the total amount distributed for
all stakes races from the purse account, including overnight stakes
races, at that meeting of the racing association licensed to conduct
live racing.
   (c) It is the intent of the Legislature that the thoroughbred
racing associations in this state, in conjunction with the official
registering agency, and owners and trainers organizations meet and
report to the board on the establishment of a coordinated
California-bred restricted schedule of stakes races designed to
showcase California-bred restricted stakes races and qualify
registered California-bred horses for the California Cup and the
California Cup Day races.  It is also the intent of the Legislature
that the report be submitted to the board annually at least 60 days
prior to the start of the racing year.
  SEC. 71.  Section 19569 of the Business and Professions Code is
amended to read:
   19569.  In order to encourage and develop the racing of quarter
horses, whenever a fair conducts a program of horse races on which
there is parimutuel wagering, it shall, so far as practicable,
provide a program of quarter horse racing on the same days that it
provides a program of other types of horse racing, if sufficient
quarter horses are available to provide competition in one or more
quarter horse races.
   Such quarter horse events may be in addition to the customary
number of thoroughbred or standardbred events.
  SEC. 72.  Section 19572 of the Business and Professions Code is
amended to read:
   19572.  The board may, by rule, provide for the exclusion or
ejection from any inclosure where horse races are authorized, or from
specified portions of such inclosure, of any known bookmaker, known
tout, person who has been convicted of a violation of any provision
of this chapter or of any law prohibiting bookmaking or any other
illegal form of wagering on horse races, or any other person whose
presence in the inclosure would, in the opinion of the board, be
inimical to the interests of the state or of legitimate horse racing,
or both.  No such rule shall provide for the exclusion or ejection
of any person on the ground of race, color, creed, national origin or
ancestry, or sex.
  SEC. 73.  Section 19574 of the Business and Professions Code is
amended to read:
   19574.  Any person who is excluded or ejected from an inclosure
pursuant to a rule or rules promulgated pursuant to the provisions of
Section 19572 is guilty of a misdemeanor if he thereafter enters the
inclosure of any association during its horse race meeting without
having first obtained a determination by the board that the rule or
rules pursuant to which he was excluded or ejected does not or should
not apply to him.
  SEC. 74.  Section 19577 of the Business and Professions Code is
amended to read:
   19577.  (a) Any blood or urine test sample required by the board
to be taken from a horse that is entered in any race shall be divided
or taken in duplicate, if there is sufficient sample available after
the initial test sample has been taken.  The initial test sample
shall be referred to as the official test sample and the secondary
sample shall be referred to as the split sample.  All samples
immediately become and remain the property of the board.  The board
shall adopt regulations to ensure the security of obtaining and
testing of all samples.
   (b) If the official test sample is found to contain a prohibited
drug substance, the executive director, after consulting with and
agreeing with the equine medical director that the official test
sample contains a prohibited substance, shall confidentially inform
the owner and trainer of those results.  The owner or the trainer of
the horse, upon being so informed, may request that the split sample
be tested                                            by an
independent laboratory selected from a list of laboratories provided
by and approved by the board.  The owner or trainer of the horse
shall pay the cost of testing the split sample.
   (c) If the split sample test results fail to confirm the finding
of the prohibited drug substance found in the official test sample, a
presumption affecting the burden of producing evidence pursuant to
Section 603 of the Evidence Code of no evidentiary prohibited drug
substance in the animal shall exist for purposes of this chapter.
   (d) The executive director shall report to the board a finding of
a prohibited drug substance in an official test sample within 24
hours of the confirmation of that prohibited drug substance in the
split sample by the independent laboratory, or within 24 hours of
waiver of split sample testing by the owner or trainer.  Any
recommendation to the board by the executive director to dismiss the
matter shall be by mutual agreement with the equine medical director.
  The authority for the disposition of the matter shall be the
responsibility of the board.
   (e) The executive director shall maintain responsibility for all
test samples until the executive director refers the matter to the
board.  Notwithstanding any other provision of law, and except as
provided in subdivision (a), the results of the tests from the
official testing laboratory, the Kenneth L. Maddy Equine Analytical
Chemistry Laboratory and the independent laboratory shall be
confidential until or unless the board files an official complaint.
   (f) If the owner or trainer does not request that the split sample
be tested within the time limits set by the board, the owner and
trainer waive all rights to that sample and the board assumes all
jurisdiction over the split sample.
   (g) The board shall contract with the Regents of the University of
California to have one-third of the routine equine drug testing
required by this section performed by the California Animal Health
and Food Safety Laboratory.
  SEC. 75.  Section 19578 of the Business and Professions Code is
amended to read:
   19578.  (a) It is the intent of the Legislature that the board
contract with the Regents of the University of California to provide
equine drug testing.  It is further the intent of the Legislature
that to the extent that resources are available, the California
Animal Health and Food Safety Laboratory perform studies that may
lead to the development of alternative or improved drug testing
techniques.
   (b) The Kenneth L. Maddy Equine Analytical Chemistry Laboratory
shall be located at the University of California at Davis in order to
take advantage of the expertise of the veterinary specialists at
that campus' School of Veterinary Medicine.  The laboratory shall be
a part of the California Animal Health and Food Safety Laboratory.
Any capital outlay expenditures for the Kenneth L. Maddy Equine
Analytical Chemistry Laboratory shall comply with Section 13332.11 of
the Government Code.
   (c) Funds collected under Article 9.2 (commencing with Section
19605) and Article 9.5 (commencing with Section 19610) for purposes
of the California Animal Health and Food Safety Laboratory and the
Center for Equine Health shall be deposited in the California Animal
Health and Food Safety Laboratory and Center for Equine Health
Account in the Fair and Exposition Fund.  Funds deposited in that
account constitute trust funds and shall be held in trust and may be
expended only for the purposes for which those funds are authorized
to be expended pursuant to this section.  The funds designated for
the California Animal Health and Food Safety Laboratory shall be
distributed to that system and shall be used to fund the construction
costs, equipment costs, and for the repayment of the principal of,
interest on, and costs of issuance of, and as security, including any
coverage factor, pledged to the payment of, bonds issued or other
debt service or expense, including repayment of any advances made or
security required by any provider of credit enhancement or liquidity
for those bonds or other indebtedness, or expense of maintaining that
credit enhancement or liquidity, incurred for the purpose of
constructing the Kenneth L. Maddy Equine Analytical Chemistry
Laboratory, and for the operating costs of the Kenneth L. Maddy
Equine Analytical Chemistry Laboratory.  The funds designated for the
Center for Equine Health shall be distributed to the Center for
Equine Health, School of Veterinary Medicine, University of
California, Davis.
   (d) Title to the Kenneth L. Maddy Equine Analytical Chemistry
Laboratory shall vest in the Regents of the University of California.
  The laboratory shall be used in a manner that is consistent with
Section 19577 and this section.
   (e) The board shall contract to provide compensation for an equine
medical director who shall advise the Kenneth L. Maddy Equine
Analytical Chemistry Laboratory and be appointed by the Dean of the
School of Veterinary Medicine under applicable university hiring
rules with the advice of the board.  The equine medical director
shall be a member of the scientific advisory committee to the Kenneth
L. Maddy Equine Analytical Chemistry Laboratory, and act as the
primary advisor to the board on all matters relating to medication
and drug testing, the practice of veterinary medicine within the
areas regulated by the board, and the health and safety of horses
within the inclosure.
   (f) The budget for equine drug testing to be performed by the
California Animal Health and Food Safety Laboratory pursuant to
Section 19577 shall be established as a permanent line item in the
budget of the board.  Operating budget requests shall be submitted
annually by the university, and the board shall transfer funds
appropriated for the operation of the laboratory and for equipment,
in accordance with the contract, to the university.
   (g) The board and the University of California may expand the
services provided by the laboratory to the board in a manner that is
mutually agreeable and is consistent with Section 19577 and this
section.
  SEC. 76.  Section 19578.1 of the Business and Professions Code is
amended to read:
   19578.1.  If the equine drug testing is not conducted by the
Kenneth L.  Maddy Equine Analytical Chemistry Laboratory at the
University of California, Davis, the board shall contract with the
best qualified equine drug testing laboratory at a compensation rate
that the board determines is fair and reasonable to the State of
California and the board.
  SEC. 77.  Section 19580 of the Business and Professions Code is
amended to read:
   19580.  (a) The board shall adopt regulations to establish
policies, guidelines, and penalties relating to equine medication in
order to preserve and enhance the integrity of horse racing in the
state.  Those policies, guidelines, and penalties shall include, at a
minimum, the provisions set forth in this article.
   (b) It is the intent of the Legislature that the board, in its
testing efforts to determine illegal or excessive use of substances,
recognize the greater importance of conducting complete and thorough
testing of a lesser number of samples in preference to conducting
less thorough testing on a greater number of samples.
  SEC. 78.  Section 19581 of the Business and Professions Code is
amended to read:
   19581.  No substance of any kind shall be administered by any
means to a horse after it has been entered to race in a horse race,
unless the board has, by regulation, specifically authorized the use
of the substance and the quantity and composition thereof.  The board
may require that the official veterinarian approve, in writing, the
administration of those substances in accordance with the regulations
of the board.  Any medication or equipment used to dispense
medication that is located within the inclosure is subject to search
and inspection at the request of any board official.
  SEC. 79.  Section 19590 of the Business and Professions Code is
amended to read:
   19590.  The board shall adopt rules governing, permitting, and
regulating wagering on horse races under the system known as the
parimutuel method of wagering.  Such wagering shall be conducted only
by a person licensed under this chapter to conduct a horse racing
meeting, and only within the inclosure and on the dates for which
horse racing has been authorized by the board.
  SEC. 80.  Section 19591 of the Business and Professions Code is
amended to read:
   19591.  Any licensee conducting a horse racing meeting shall
provide a place or places within the meeting grounds or inclosure
where the licensee may conduct, operate, and supervise the parimutuel
method of wagering in accordance with this chapter.
  SEC. 81.  Section 19592 of the Business and Professions Code is
amended to read:
   19592.  The parimutuel system of wagering shall be operated only
by a totalizator or other equipment approved by the board.  The board
shall not require any particular make of equipment.  The
communications system, technology, and method used to accept wagers
and transmit odds, results, and other data related to wagering shall
be approved by the board.
  SEC. 82.  Section 19592.5 of the Business and Professions Code is
amended to read:
   19592.5.  In order to facilitate the intrastate transmission of
racing programs, the board shall adopt regulations that provide for
the compatibility of parimutuel totalizator systems within the state,
including uniform procedures for the placing and cashing of
parimutuel wagers.
  SEC. 83.  Section 19597 of the Business and Professions Code is
amended to read:
   19597.  Notwithstanding any other provision of this chapter, a
person licensed under this chapter to conduct a horse racing meeting
shall, as to any payment made to a person who has wagered by
contributing to a parimutuel pool operated by such licensee, also
deduct the applicable breakage, as defined by Section 19405.
  SEC. 84.  Section 19598 of the Business and Professions Code is
amended to read:
   19598.  Any person claiming to be entitled to any part of a
redistribution from a parimutuel pool operated by a licensee under
this chapter, who fails to claim the money due the person prior to
the completion of the horse racing meeting at which the pool was
formed, may file a claim with the association issuing the person's
ticket prior to May 15 of the year immediately following the close of
the horse racing meeting.
   The funds that were unclaimed within the period specified under
this section are designated as "unclaimed tickets" and shall be
distributed in accordance with this chapter.
  SEC. 85.  Section 19599 of the Business and Professions Code is
amended to read:
   19599.  An association or fair may offer any form of parimutuel
wagering, as defined by regulations adopted by the board, or as
defined by Chapter 9, Pari-Mutuel Wagering, Uniform Rules of Racing,
as published by the Association of Racing Commissioners
International.  The board may prohibit any form of parimutuel
wagering if it determines that the proposed wagering would compromise
the honesty and integrity of racing in the state.  Each racing
association or fair shall include the types of conventional exotic
and other wagering it proposes to offer on its application to conduct
a horse racing meeting.
  SEC. 86.  Section 19601 of the Business and Professions Code is
amended to read:
   19601.  (a) Notwithstanding any other provision of law, a licensed
association or fair that is conducting a live meeting in any racing
zone may accept wagers on any race conducted in this state, if all of
the following requirements are met:
   (1) The association or fair that conducts the racing meeting and
the organization that is responsible for negotiating purse agreements
on behalf of the horsemen participating in that racing meeting
consent to the acceptance of the wagers.  However, if consent is
withheld, any party may appeal the withholding of consent to the
board, which may determine that consent is not required.
   (2) The association or fair conducts not less than eight races on
days when the association or fair is licensed to conduct racing,
except that fewer than eight live races per day may be conducted by
the mutual agreement of the association or fair and the organization
that is responsible for negotiating purse agreements on behalf of the
horsemen participating in the racing meeting.
   (3) Wagering is offered only within the association's or fair's
racing inclosure or within the satellite wagering facility and only
within seven days of the commencement of the racing program with the
transmitted race.
   (4) All wagers are included in the appropriate parimutuel pool at
the racetrack of the association or fair where the race is conducted,
or, in the appropriate parimutuel pool of the racetrack of the
association or fair that accepts the transmitted race.
   (5) The association or fair accepting wagers on an out-of-zone
transmitted race distributes the audiovisual signal of the race to,
and accepts wagers from, all eligible satellite wagering facilities.

   (b) Any association or fair accepting wagers under subdivision (a)
shall deduct, from the total amount handled in each conventional and
exotic parimutuel pool on the transmitted race, the same percentages
deducted pursuant to Article 9.5 (commencing with Section 19610) for
races at its own meeting.  However, if the wagers are from a quarter
horse race meeting, then the amounts deducted shall be the same as
for a quarter horse race meeting.  Amounts deducted under this
section, including amounts deducted from wagers on out-of-zone races
within the inclosure of the association or fair, shall be distributed
as provided under Sections 19605.7, 19605.72, and 19605.73 with
respect to wagers made within the northern zone, or Sections
19605.71, 19605.72, and 19605.73 with respect to wagers made within
the central or southern zone, except that amounts distributed for
purposes other than state license fees and fees payable to the Center
for Equine Health, School of Veterinary Medicine, University of
California at Davis, and the California Animal Health and Food Safety
Laboratory shall be proportionally reduced by the amount of any fees
paid to the Triple Crown or Breeder's Cup day host association
pursuant to subdivision (c).  The method used to calculate the
reduction in proportionate share shall be approved by the board.  For
wagers on out-of-state and out-of-country races made within the
association's or fair's inclosure, 1 percent shall be distributed to
the association or fair as a satellite wagering facility commission.

   (c) Nothing in this section precludes an association or fair from
charging a fee as a condition of transmitting the Triple Crown or
Breeder's Cup day races, except that any fee shall be allocated among
all associations, fairs, and satellite wagering facilities receiving
the transmitted race in proportion to the amount wagered at each
location, and the fee shall equal that charged by the entity
conducting the race or races.  Further, the only fee that can be
charged as a condition of transmitting the signal of an out-of-zone
race shall be a fee of 2.5 percent on Breeder's Cup day races.
   (d) All breakage and unclaimed tickets, including unclaimed
refunds, shall be distributed equally between the association or fair
that accepts wagers on the transmitted race, and the horsemen, in
the form of purses.  The purse moneys generated by this subdivision
shall be made available for purses during the meeting in which they
are received by the association or fair, or, if the association or
fair is not then conducting a live racing meeting, during the next
succeeding meeting of the association or fair.
   (e) All wagers made pursuant to this section shall be considered
to have been wagered at a satellite wagering facility and shall be
excluded from total handle for the purposes of Section 19611.
   (f) Notwithstanding Section 19530.5, satellite wagering facilities
operated by a fair, in the Counties of Fresno, Kern, or Tulare shall
be considered northern zone facilities and shall receive their
audiovisual signal from the association or fair conducting a racing
meeting in the northern zone that is authorized to distribute the
signal and accept wagers on central and southern zone races.
Satellite wagering facilities operated by a fair, in the Counties of
Santa Barbara or Ventura shall be considered central-southern zone
facilities and shall receive the audiovisual signal from the
association or fair conducting a racing meeting in the central or
southern zone that is authorized to distribute the signal and accept
wagers on northern zone races.
   (g) All purse moneys derived from wagering on out-of-zone races at
fair racing meetings shall be distributed to all breeds of horses
participating in the fair meeting in direct proportion to the purse
money generated by breed on live races conducted during the fair race
meeting.
   (h) During calendar periods when both a fair and a thoroughbred
association conduct live racing, the amounts deducted under this
section shall be distributed on any day of overlap as provided in
Section 19607.5, except that the applicable state license fee shall
be at the rate specified for nonfair meetings in subdivision (b) of
Section 19605.7.
   (i) During calendar periods when a thoroughbred association and a
fair, or a thoroughbred association and any other breed association
are conducting a racing meeting in the same zone, the thoroughbred
association shall be the association authorized to distribute
out-of-zone, out-of-state, or out-of-country thoroughbred or fair
races, except that the thoroughbred association may waive this right
and allow the other breed racing association conducting a race
meeting to distribute the signal and accept wagers on out-of-zone,
out-of-state, or out-of-country thoroughbred or fair races for any
racing day or days.  For the purposes of this subdivision, the
combined central and southern zone shall be considered one zone.
   (j) In order to ensure, to the extent possible, that out-of-state
and out-of-country simulcasting, furthers the purposes of this
section, a committee made up of one representative from each of the
then-operating thoroughbred associations or fairs that are conducting
a live racing meeting in the state and one representative of the
organization responsible for negotiating purse agreements on behalf
of the horsemen participating in the meeting shall do the following:

   (1) Determine the out-of-state or out-of-country thoroughbred
races to be imported on a statewide basis pursuant to provisions of
this chapter.
   (2) Ensure, to the extent possible, that the fees charged by
out-of-state or out-of-country entities for these signals are at the
lowest obtainable rate and at the same rate statewide, in order to
maximize the revenue available to in-state associations and fairs and
their horsemen.
   (3) Ensure, to the extent possible, due to the reciprocal nature
of the interstate simulcasting business, that the maximum obtainable
revenue is generated by the sale to out-of-state entities of the
audiovisual signal of races conducted in this state by thoroughbred
associations and fairs.
   (4) Ensure that program information requirements for in-state
signals comply with the standards of the board, but provide that
abbreviated program formats may be used for races imported from other
jurisdictions.
   (k) Notwithstanding any other provision of law, any thoroughbred
association or fair, when operating a live racing meeting, shall
distribute the signal of all races conducted by, or disseminated by,
that association or fair to, and accept wagers on these races from,
any association that is licensed to conduct a live quarter horse or
harness racing meeting in Orange County and that conducted such a
meeting in 1998.
   (l) Notwithstanding any other provision of law, all associations
or fairs when operating as eligible satellite wagering facilities
shall be in compliance with, and subject to the provisions of,
Article 9.2 (commencing with Section 19605) of this chapter, and
shall display the signal and accept wagers on all live races
conducted in this state without regard to breed.  Notwithstanding the
foregoing provision, a thoroughbred racing association located in
the city of Arcadia is exempt from these requirements for live
harness and quarter horse races conducted at night unless the
thoroughbred racing association facility is open for business at that
time and is accepting wagers on other night signals pursuant to this
chapter.  Further, satellite wagering facilities located at fairs
may, but are not required to, accept an audiovisual signal on
out-of-state or out-of-country races unless the facility is open for
business at the time and accepting wagers on other signals pursuant
to this chapter.
  SEC. 87.  Section 19602 of the Business and Professions Code is
amended to read:
   19602.  (a) Notwithstanding any other provision of law, any racing
association in this state may authorize betting systems located
outside of this state to accept wagers on a race or races conducted
or disseminated by that association and may transmit live audiovisual
signals of the race or races and their results to those betting
systems, except that any authorization is subject to the consent of
the host association and applicable federal laws, including, but not
limited to, Chapter 57 (commencing with Section 3001) of Title 15 of
the United States Code.
   (b) (1) Except as provided in paragraph (2), any racing
association described in subdivision (a), when it authorizes betting
systems located outside of this state to accept wagers on a race,
shall pay a license fee to the state in an amount equal to 8 percent
of the total amount received by the association from the out-of-state
betting system.  In addition, with respect to thoroughbred racing
only, 3 percent of the amount remaining after the payment of the
license fee shall be deposited with the official registering agency
pursuant to subdivision (a) of Section 19617.2, and shall thereafter
be distributed in accordance with subdivisions (b), (c), and (d) of
Section 19617.2.  The remaining amount received by the association
shall be distributed to the association that conducts the racing
meeting and to horsemen participating in that racing meeting as
follows:  50 percent to the association as commissions, and 50
percent to the horsemen as purses.  All rents, costs, and fees shall
be deducted pursuant to a contract between the association that
conducts the racing meeting and the horsemen participating in the
racing meeting.  Notwithstanding any other provision of law, racing
associations may form a partnership, joint venture, or any other
affiliation in order to negotiate terms and conditions of agreements
with out-of-state betting systems.
   (2) A thoroughbred association that hosts the series of races
known as the "Breeder's Cup" shall not be required to pay to the
state the license fees required pursuant to paragraph (1).  Amounts
received by the association from out-of-state betting systems as
wagers on Breeder's Cup races shall be distributed as follows:  50
percent as commissions to the association that conducts the racing
meeting, and 50 percent as purses to the horsemen participating in
the meeting.
   (c) With the permission of the board, wagers accepted by betting
systems located outside of this state may be, but are not required to
be, included in the parimutuel pool of the association that conducts
the racing meeting in this state.  If the wagers accepted by betting
systems located outside of this state are included in the parimutuel
pool of the association that conducts the racing meeting in this
state, the betting system located outside of this state shall, if
permissible under applicable law, deduct from the total amount
handled in each conventional and exotic parimutuel pool the same
total percentages deducted pursuant to Article 9.5 (commencing with
Section 19610) by the association that conducts the racing meeting in
this state.  If the laws of the jurisdiction in which the betting
system is located do not permit the betting system to deduct the same
percentages as are deducted by the association that conducts the
racing, the board may, nonetheless, permit the inclusion of those
out-of-state wagers in the association's parimutuel pool if the board
determines it to be in the public interest of this state to do so.
   (d) If wagers accepted by an association conducting racing within
the state and wagers accepted by a betting system located outside of
the state are combined in one parimutuel pool and the association and
the betting system both deduct the same total percentages as set
forth in subdivision (c), the breakage shall be allocated between the
association and the betting system on the basis of a calculation for
distribution approved by the board.
   (e) If wagers accepted by an association conducting racing within
the state are combined in one parimutuel pool with wagers accepted by
a betting system located outside the state and the association and
the betting system deduct different percentages from the amount
handled in the parimutuel pool, the precise calculation and
distribution of payments on winning tickets and breakage between the
association and the betting system shall be on the basis of a
calculation for distribution approved by the board.
   (f) Breakage allocated pursuant to this section to an association
conducting racing within this state shall be distributed in the same
manner as would be breakage arising from wagers at the association in
the absence of a combined parimutuel pool.  This section does not
apply to the disposition of breakage allocated to the betting system
located outside of the state.
   (g) If wagers accepted by a betting system located outside of this
state are included in the parimutuel pool of an association
conducting racing in this state, funds in the parimutuel pool
attributable to unclaimed tickets relating to wagers accepted by the
association conducting racing within the state shall be distributed
in the same manner as unclaimed tickets relating to wagers accepted
by that association in the absence of a combined parimutuel pool.
Funds in the parimutuel pool attributable to unclaimed tickets
related to wagers accepted by the betting system located outside of
this state shall be allocated to that betting system, and this
section does not otherwise apply to the disposition of those funds at
that location outside of the state.
  SEC. 88.  Section 19605 of the Business and Professions Code is
amended to read:
                                 19605.  (a) Notwithstanding any
other provision of law, the board may authorize an association
licensed to conduct a racing meeting in the northern zone to operate
a satellite wagering facility for wagering on races conducted in the
northern zone at its racetrack inclosure subject to all of the
conditions specified in Section 19605.3, and may authorize an
association licensed to conduct a racing meeting in the central or
southern zone to operate a satellite wagering facility for wagering
on races conducted in the central or southern zone at its racetrack
inclosure subject to the conditions specified in subdivisions (a) to
(e), inclusive, of Section 19605.3 and the conditions and limitations
set forth in Section 19605.6.
   (b) Notwithstanding any other provision of law, no satellite
wagering facility, except a facility that is located at a track where
live racing is conducted, shall be located within 20 miles of any
existing satellite wagering facility or of any track where a racing
association conducts a live racing meeting.  However, in the northern
zone, a racing association or any existing satellite wagering
facility may waive the prohibition contained in this subdivision and
may consent to the location of another satellite wagering facility
within 20 miles of the facility or track.
   (c) Notwithstanding subdivision (b), the Department of Food and
Agriculture may approve not more than three satellite wagering
facilities that are licensed jointly to the 1a District Agricultural
Association and the 5th District Agricultural Association and that
are located on the fairgrounds of the 1a District Agricultural
Association or within the boundaries of the City and County of San
Francisco.  Before a satellite wagering facility may be licensed for
the 1997 and subsequent calendar years under this subdivision, the
department shall conduct a one-year test at the proposed site in
order to determine the impact of the proposed facility on total state
parimutuel revenues and on attendance and wagering at existing
racetracks and fair satellite wagering facilities in the Counties of
Alameda, San Mateo, Santa Clara, and Solano.  Notwithstanding Section
19605.1, a satellite wagering facility may be located on property
leased to one or both fairs.  Notwithstanding any other provision of
law, the fairs may contract for the operation and management of a
satellite wagering facility with an individual racing association or
a partnership, joint venture, or other affiliation of two or more
racing associations that are licensed to conduct thoroughbred
meetings within the northern zone.
   (d) Subdivision (b) shall not be construed to prohibit the
location of satellite wagering facilities within 20 miles of any
existing or proposed satellite facility established pursuant to
subdivision (c).
  SEC. 89.  Section 19605.1 of the Business and Professions Code is
amended to read:
   19605.1.  With respect to the northern zone, the board may, with
the approval of the Department of Food and Agriculture, also
authorize any fair, in the northern zone that is eligible for an
allocation of racing days pursuant to Section 19549, but which is not
licensed to conduct a racing meeting or authorized pursuant to
Section 19605.6, to locate a satellite wagering facility at its
fairgrounds for wagering on races conducted in the northern zone if
all of the conditions specified in Section 19605.3 are satisfied.
  SEC. 90.  Section 19605.2 of the Business and Professions Code is
amended to read:
   19605.2.  With respect to the central and southern zones, the
board may, with the approval of the Department of Food and
Agriculture, subject to the conditions and limitations set forth in
Section 19605.6, also authorize any fair, which conducted general
fair activities in 1986 within the central or southern zone, and
which is eligible for an allocation of racing days pursuant to
Section 19549, but which is not licensed to conduct a racing meeting,
to locate a satellite wagering facility at its fairgrounds for
wagering on races conducted in the central or southern zone if all of
the conditions specified in subdivisions (a) to (e), inclusive, of
Section 19605.3 are satisfied.
  SEC. 91.  Section 19605.3 of the Business and Professions Code is
amended to read:
   19605.3.  (a) An organization described in Section 19608.2 has
executed an agreement approved by the board with the association
conducting a racing meeting and the satellite wagering facility.  The
agreement shall provide, among other things, for all of the
following:
   (1) The conditions for transmission of the signal.
   (2) That the wagers made at the satellite wagering facility will
be included in the appropriate conventional or exotic pool at the
racetrack where the racing meeting is conducted.
   (3) The agreement of the parties, if any, respecting the payment
of fees or charges by one party to the other in substitution of, or
in addition or supplemental to, the distributions of the amount
deducted pursuant to the first paragraph of either Section 19605.7 or
Section 19605.71.  The agreement as to the payment of those fees or
charges shall not operate to increase or reduce the amounts otherwise
payable from the amount handled pursuant to this article, other than
to a party to the agreement.  Any dispute relating to the amount of
fees or charges to be paid by any party as a condition of receiving
the live audiovisual signal from an association or fair may be
appealed to the board.  However, nothing in this paragraph shall be
construed to require an association or fair to execute an agreement.

   (b) The accommodations and equipment used in conducting wagering
at the satellite wagering facility and their location have been
approved by the board.
   (c) The communications system, technology and method used by the
satellite wagering facility to accept wagers and transmit odds,
results, and other data related to wagering has been approved by the
board.
   (d) (1) Any association or fair that operates a satellite wagering
facility shall conduct wagering on all racing that is offered to the
satellite wagering facility, except as otherwise provided in Section
19607.5 with respect to the northern zone, as long as the satellite
wagering facility is not sustaining a loss on either a day meeting or
night meeting, as determined by the board, and, if sustaining a loss
on either a day meeting or night meeting, as long as the satellite
wagering facility is reimbursed for that loss by either an
organization described in Section 19608.2 or an association.  Any
association that operates a satellite wagering facility may, but is
not required to, accept an audiovisual signal.  Notwithstanding any
other provision of this paragraph, an association that conducts a
racing meeting and a fair that operates a satellite wagering facility
may agree to provide an audiovisual signal and to accept wagering on
less than all of the races.  Acceptance of the audiovisual signal
may be on such terms and conditions, including the payment of fees
and charges, subject to paragraph (3) of subdivision (a), as the
parties may mutually agree.
   (2) In calculating the loss, if any, for operating a satellite
wagering facility for a night meeting, only the expenses incurred by
the satellite wagering facility because of the acceptance of night
wagers shall be considered, and no overhead expenses or expenses of
the satellite wagering facility which would be incurred regardless of
the acceptance of night wagers shall be considered.
   (e) Notwithstanding any other law or any agreement under
subdivision (a), for purposes of determining license fees and
breakage at the racetrack where the racing meeting is conducted,
wagers at a satellite wagering facility shall not be included in the
conventional or exotic pools of the association conducting the racing
meeting.
   (f) The horsemen's organization that represents the horsemen at
the association that conducts the racing meeting on which wagers are
accepted consents to the acceptance of wagers at the satellite
wagering facility, except that the association or fair operating the
satellite wagering facility may appeal the withholding of consent to
the board that may determine that consent is not required.
  SEC. 92.  Section 19605.51 of the Business and Professions Code is
amended to read:
   19605.51.  Notwithstanding subdivision (a) of Section 19605, and
Section 19605.1, any fair in San Joaquin, Humboldt, or Fresno County
may, with the approval of the Department of Food and Agriculture and
the authorization of the board, subject to the conditions specified
in Section 19605.3, operate a satellite wagering facility on leased
premises within the boundaries of that fair, but may only operate one
such facility.
  SEC. 93.  Section 19605.6 of the Business and Professions Code is
amended to read:
   19605.6.  (a) In addition to satellite wagering facilities
authorized pursuant to Sections 19605, 19605.1, and 19605.2, the
board, with the approval of the Department of Food and Agriculture,
may authorize any fair, in the County of Kern or Santa Barbara,
eligible for an allocation of racing days pursuant to Section 19549,
to operate a satellite wagering facility at its fairgrounds even
though the fair is not licensed to conduct a racing meeting, and the
fair may operate the facilities except for those functions to be
performed by an organization described in Section 19608.2.  Except as
otherwise provided in this chapter, Sections 19605, 19605.3,
19605.4, 19605.7, 19605.71, 19605.8, 19606, 19606.1, 19606.3, and
19606.4 apply to satellite wagering facilities authorized pursuant to
this section.
   (b) It is the intent of the Legislature that the board provide,
when feasible, for periods of at least 10 minutes between post times
for live races conducted within California.
  SEC. 94.  Section 19605.7 of the Business and Professions Code is
amended to read:
   19605.7.  The total percentage deducted from wagers at satellite
wagering facilities in the northern zone shall be the same as the
deductions for wagers at the racetrack where the racing meeting is
being conducted and shall be distributed as set forth in this
section.  Amounts deducted under this section shall be distributed as
follows:
   (a) For thoroughbred meetings, 1.3 percent of the amount handled
by the satellite wagering facility on conventional and exotic wagers
shall be distributed to the racing association for payment to the
state as a license fee, 2 percent shall be distributed to the
satellite wagering facility as a commission for the right to do
business, as a franchise, and this commission is not for the use of
any real property, 2.5 percent or the amount of actual operating
expenses, as determined by the board, whichever is less, shall be
distributed to an organization described in Section 19608.2, and 0.54
percent shall be deposited with the official registering agency
pursuant to subdivision (a) of Section 19617.2 and shall thereafter
be distributed in accordance with subdivisions (b), (c) and (d) of
Section 19617.2, and 0.033 percent distributed to the Center for
Equine Health and 0.067 percent distributed to the California Animal
Health and Food Safety Laboratory, School of Veterinary Medicine,
University of California at Davis.  It is the intent of the
Legislature that the 0.033 percent of funds distributed to the Center
for Equine Health shall supplement, and not supplant, other funding
sources.
   (b) For harness, quarter horse, Appaloosa, Arabian, or mixed breed
meetings, 0.4 percent of the amount handled by the satellite
wagering facility on conventional and exotic wagers shall be
distributed to the racing association for payment to the state as a
license fee, for fair meetings, 1 percent of the amount handled by
the satellite wagering facility on conventional and exotic wagers
shall be distributed to the fair association for payment to the state
as a license fee, 2 percent shall be distributed to the satellite
wagering facility as a commission for the right to do business, as a
franchise, and this commission is not for the use of any real
property, and 6 percent of the amount handled by the satellite
wagering facility or the amount of actual operating expenses, as
determined by the board, whichever is less, shall be distributed to
an organization described in Section 19608.2.  In addition, in the
case of quarter horses, 0.4 percent shall be deposited with the
official registering agency pursuant to subdivision (b) of Section
19617.7 and shall thereafter be distributed in accordance with
subdivisions (c), (d), and (e) of Section 19617.7; in the case of
Appaloosas, 0.4 percent shall be deposited with the official
registering agency pursuant to subdivision (b) of Section 19617.9 and
shall thereafter be distributed in accordance with subdivisions (c),
(d), and (e) of Section 19617.9; in the case of Arabians, 0.4
percent shall be held by the association to be deposited with the
official registering agency pursuant to Section 19617.8, and shall
thereafter be distributed in accordance with Section 19617.8; in the
case of standardbreds, 0.4 percent shall be distributed for the
California Standardbred Sires Stakes Program pursuant to Section
19619; in the case of thoroughbreds, 0.48 percent shall be deposited
with the official registering agency pursuant to subdivision (a) of
Section 19617.2 and shall thereafter be distributed in accordance
with subdivisions (b), (c), and (d) of Section 19617.2; and 0.033
percent shall be distributed to the Center for Equine Health and
0.067 percent shall be distributed to the California Animal Health
and Food Safety Laboratory, School of Veterinary Medicine, University
of California at Davis.  It is the intent of the Legislature that
the 0.033 percent of funds distributed to the Center for Equine
Health shall supplement, and not supplant, other funding sources.
   (c) In addition to the distributions specified in subdivision (a)
and (b), for mixed breed meetings, 1 percent of the total amount
handled by each satellite wagering facility shall be distributed to
an organization described in Section 19608.2 for promotion of the
program at satellite wagering facilities.  For quarter horse meetings
and harness meetings, 0.5 percent of the total amount handled by
each satellite wagering facility shall be distributed to an
organization described in Section 19608.2 for the promotion of the
program at satellite wagering facilities, and 0.5 percent of the
total amount handled by each satellite wagering facility shall be
distributed according to a written agreement for each race meeting
between the licensed racing association and the organization
representing the horsemen participating in the meeting.
   (d) Additionally, for thoroughbred, harness, quarter horse, mixed
breed, and fair meetings, 0.33 percent of the total amount handled by
each satellite wagering facility shall be paid to the city or county
in which the satellite wagering facility is located pursuant to
Section 19610.3 or 19610.4.
   (e) Notwithstanding any other provision of law, a racing
association is responsible for the payment of the state license fee
as required by this section.
  SEC. 95.  Section 19605.71 of the Business and Professions Code is
amended to read:
   19605.71.  The total percentage deducted from wagers at satellite
wagering facilities in the central and southern zone shall be the
same as the percentage deducted from wagers at the racetrack where
the racing meeting is being conducted and shall be distributed as set
forth in this section.  Amounts deducted by a satellite wagering
facility under this section shall be distributed as follows:
   (a) For thoroughbred meetings, 2 percent of the amount handled by
the satellite wagering facility on conventional and exotic wagers
shall be distributed to the racing association for payment to the
state as a license fee, 2 percent shall be distributed to the
satellite wagering facility as a commission for the right to do
business, as a franchise, and this commission is not for the use of
any real property, 2.5 percent or the amount of actual operating
expenses, as determined by the board, whichever is less, shall be
distributed to an organization described in Section 19608.2, and 0.54
percent shall be deposited with the official registering agency
pursuant to subdivision (a) of Section 19617.2 and shall thereafter
be distributed in accordance with subdivisions (b), (c), and (d) of
Section 19617.2, and 0.033 percent shall be distributed to the Center
for Equine Health and 0.067 percent shall be distributed to the
California Animal Health and Food Safety Laboratory, School of
Veterinary Medicine, University of California at Davis.  It is the
intent of the Legislature that the 0.033 percent of funds distributed
to the Center for Equine Health shall supplement, and not supplant,
other funding sources.
   (b) For harness, quarter horse, Appaloosa, Arabian, or mixed breed
meetings, 0.4 percent of the amount handled by the satellite
wagering facility on conventional and exotic wagers shall be
distributed to the racing association for payment to the state as a
license fee, for fair meetings, 1 percent of the amount handled by
the satellite wagering facility on conventional and exotic wagers
shall be distributed to the racing association for payment to the
state as a license fee, 2 percent shall be distributed to the
satellite wagering facility as a commission for the right to do
business, as a franchise, and this commission is not for the use of
any real property, and 6 percent of the amount handled by the
satellite wagering facility or the amount of actual operating
expenses, as determined by the board, whichever is less, distributed
to an organization described in Section 19608.2.  In addition, in the
case of quarter horses, 0.4 percent shall be distributed as breeders'
awards to breeders of quarter horses pursuant to Section 19617.6; in
the case of Appaloosas, 0.4 percent shall be deposited with the
official registering agency pursuant to subdivision (b) of Section
19617.9 and shall thereafter be distributed in accordance with
subdivisions (c), (d), and (e) of Section 19617.9; in the case of
Arabians, 0.4 percent shall be held by the association to be
deposited with the official registering agency, pursuant to Section
19617.8, and thereafter shall be distributed in accordance with
Section 19617.8; in the case of standardbreds, 0.4 percent shall be
distributed for the California Standardbred Sires Stakes Program
pursuant to Section 19619; in the case of thoroughbreds, 0.48 percent
shall be deposited with the official registering agency pursuant to
subdivision (a) of Section 19617.2 and shall thereafter be
distributed in accordance with subdivisions (b), (c), and (d) of
Section 19617.2; and 0.033 percent shall be distributed to the Center
for Equine Health and 0.067 percent shall be distributed to the
California Animal Health and Food Safety Laboratory, School of
Veterinary Medicine, University of California at Davis.  It is the
intent of the Legislature that the 0.033 percent of funds distributed
to the Center for Equine Health shall supplement, and not supplant,
other funding sources.
   (c) In addition, for Appaloosa and mixed breed meetings, 1 percent
shall be distributed to an organization described in Section 19608.2
for promotion of the program at satellite wagering facilities.
Notwithstanding any other provision of law, on wagers made in the
Counties of Orange and Los Angeles on thoroughbred races conducted in
the County of Orange or Los Angeles, or both, excluding the 50th
District Agricultural Association, the amount deducted for promotion
of the satellite wagering program at satellite wagering facilities
shall be 0.5 percent.  Any of the promotion funds that are not
distributed in the year in which they are collected may be
distributed in the following year.  If promotion funds distributed in
any year exceed the amount collected for that year, the funds
distributed in the following year shall be reduced by the excess
amount.  For quarter horse and harness meetings, 0.5 percent of the
total amount handled by each satellite wagering facility shall be
distributed to an organization described in Section 19608.2 for the
promotion of the program at satellite wagering facilities, and 0.5
percent of the total amount handled by each satellite wagering
facility shall be distributed according to a written agreement for
each race meeting between the licensed racing association and the
organization representing the horsemen participating in the meeting.

   (d) Additionally, for thoroughbred, harness, quarter horse, mixed
breed, and fair meetings, 0.33 percent of the total amount handled by
the satellite wagering facility shall be paid to the city or county
in which the satellite wagering facility is located pursuant to
Section 19610.3 or 19610.4.
   (e) Notwithstanding any other provision of law, a racing
association is responsible for the payment of the state license fee
as required by this section.
  SEC. 96.  Section 19608.5 of the Business and Professions Code is
amended to read:
   19608.5.  All revenues payable to the state and deposited in a
separate account in the fund pursuant to Section 19606.1 that are
allocated by the Secretary of Food and Agriculture for the purposes
of paragraph (1) of subdivision (a) of Section 19606.1 are hereby
pledged for the repayment of the principal of, and interest on, bonds
issued by a joint powers agency, or of other debt service or expense
incurred for the purposes described in that paragraph (1).
  SEC. 97.  Section 19608.6 of the Business and Professions Code is
amended to read:
   19608.6.  (a) Any joint powers agency requesting money in
connection with the issuance of bonds for the purposes described in
paragraph (1) of subdivision (a) of Section 19606.1 shall file an
application with the Secretary of Food and Agriculture, in the form
required by the secretary.
   (b) The secretary shall, upon review of the applications, prepare
a statement of allocation of money to the joint powers agency, in the
priority the director deems appropriate.
   (c) The secretary shall adopt regulations governing the allocation
procedures to be followed in implementing this section.
  SEC. 98.  Section 19610.2 of the Business and Professions Code is
amended to read:
   19610.2.  Every association that conducts a racing meeting shall
deduct one-tenth of 1 percent of the total amount handled.  From the
amount deducted on wagers made on-track, thirty-three one hundredths
of the amount deducted shall be distributed to the Center for Equine
Health and shall supplement, and not supplant, other funding sources.
  Sixty-seven one hundredths of the amount deducted shall be
distributed to the California Animal Health and Food Safety
Laboratory to fund the equine drug testing program and laboratory at
the University of California, Davis described in Section 19578.
  SEC. 99.  Section 19610.4 of the Business and Professions Code is
amended to read:
   19610.4.  Notwithstanding Section 19610.3, any association that
conducts a racing meeting pursuant to Section 19549.9, or any fair
that operates a satellite wagering facility, may elect to deduct an
additional amount of 0.33 of 1 percent from the total parimutuel
wagers placed within its inclosure or at its satellite wagering
facility.
   The amounts deducted pursuant to this section shall be retained by
the association or fair for the payment of possessory interest
taxes, if any, assessed against the organization described in Section
19608.2, the racing association, or fair, and after payment of these
taxes shall be distributed to the city or county in which the racing
meeting or wagering is conducted, at the option of the association
or fair.  If a city or county has elected by ordinance to receive a
distribution from a racing association or fair under this section, it
shall not at any time thereafter assess or collect, with respect to
an event conducted by that racing association or, an event conducted
by or by contract with that fair, any license or excise tax or fee,
including, but not limited to, any admission, parking, or business
tax, or any tax or fee levied solely upon the racing association or
fair conducting a racing meeting or satellite wagering, or any
patron, participant, service-supplier, promoter, or vendor thereof.
Further, a city or county electing to receive a distribution under
this section shall provide ordinary and traditional municipal
services, such as police services and traffic control, in connection
with the racing meetings or satellite wagering.  If an eligible city
or county does not elect to receive a distribution under this
section, the amount remaining after payment of possessory interest
taxes, if any, as provided in this section shall be paid to the state
as an additional license fee.
  SEC. 100.  Section 19611.5 of the Business and Professions Code is
amended to read:
   19611.5.  (a) In addition to the amounts otherwise deducted
pursuant to this chapter, every association other than a fair that
conducts a thoroughbred race meeting may deduct from the total amount
handled in daily double, quinella, exacta, and other multiple
wagering pools approved by the board up to 3 percent thereof to be
distributed 50 percent as commissions and 50 percent as purses.  From
the amount distributed as purses, a sum equal to 0.07 percent of the
total handle shall be held by the association to be deposited with
the official registering agency pursuant to subdivision (a) of
Section 19617.2, and shall thereafter be distributed in accordance
with subdivisions (b), (c), and (d) of Section 19617.2.
   (b) At least 30 days prior to the commencement of its meeting, the
association shall file with the board a statement of the additional
deduction to be made pursuant to subdivision (a).  Except with the
consent of the board, the amount of the deduction shall not be
changed during the course of the meeting.
  SEC. 101.  Section 19612.6 of the Business and Professions Code is
amended to read:
   19612.6.  (a) (1) For harness meetings, the amount remaining after
deduction of the state license fee shall be distributed equally
between commissions and purses.  For quarter horse, Appaloosa, and
muleracing meetings, the amount remaining after deduction of the
state license fee pursuant to Section 19612 shall be distributed
between commissions and purses as agreed to by the association
conducting the meeting and the organization representing the horsemen
or mulemen participating in the meeting.  For fair meetings
conducted pursuant to Section 19549, the amount remaining after
deduction of the state license fee pursuant to Section 19612 shall be
distributed 48 percent to commissions
             and 52 percent to purses.
   (2) Every association which conducts a racing meeting pursuant to
Section 19549 shall, in addition, deduct from its parimutuel pools
the amount specified in subdivision (d) of Section 19614.
   (b) If an association qualified to operate its meeting pursuant to
this section conducts two separate programs of racing on any day,
each such program shall be considered a separate racing day for
purposes of determining the daily handle and computing the
distribution of license fees, commissions, and purses thereon.  For
the purposes of this subdivision, a program shall consist of at least
nine races.
   (c) In addition to any deductions pursuant to this section, every
association conducting a racing meeting pursuant to Section 19549.1
shall also deduct an additional 1 percent of its parimutuel pools to
be distributed as commissions.
   (d) In addition to any deductions pursuant to this section, every
association conducting a racing meeting pursuant to Section 19549.1
shall also deduct an additional 2 percent of its exotic parimutuel
pools to be distributed equally as commissions and purses.
  SEC. 102.  Section 19612.8 of the Business and Professions Code is
amended to read:
   19612.8.  Notwithstanding any other provision of law, any
association conducting a racing meeting shall pay not less than the
actual amount necessary to cover the costs for compensation,
including any fringe benefits, to stewards and official veterinarians
and to cover the costs for that racing meeting, as provided by the
board under Section 19518.
  SEC. 103.  Section 19612.9 of the Business and Professions Code is
amended to read:
   19612.9.  (a) (1) Except as provided in subdivision (d) of Section
19601, unclaimed refunds shall be distributed to the organization
that is responsible for negotiating purse agreements, satellite
wagering agreements, and all other business agreements on behalf of
the horsemen participating in the racing meeting for the purpose of
negotiating, in good faith, an agreement of at least three years'
duration with a jockeys' organization to provide health and welfare
benefits to California licensed jockeys, former California licensed
jockeys, and their dependents if those persons contribute to the plan
and do not receive welfare benefits pursuant to Section 19613.
   (2) The amount of money distributed annually pursuant to this
section shall be held in trust solely for the purpose described in
this section and shall not exceed four hundred fifty thousand dollars
($450,000), adjusted annually for inflation. The board shall
determine the inflation adjustment based on an index quantifying
changes in the cost of health insurance benefits.
   (3) If an agreement is not reached before the regular meeting of
the board in November of any calendar year, the board, on its own
motion, shall provide that the provisions of the existing agreement,
if any, shall remain in effect until a subsequent agreement is
reached.
   (b) The jockeys' organization referred to in subdivision (a) shall
represent a majority of the jockeys licensed by the board, and the
board shall initially certify that the organization represents the
majority of those licensed jockeys.  The organization shall maintain
an office in this state. The organization certified by the board
shall provide an annual audit of the health and welfare fund
established pursuant to this section.  The organization shall make
available to the board all records and documents necessary for the
performance of its duties.
   (c) The jockeys' organization certified by the board shall develop
reasonable nondiscriminatory criteria for eligibility for health and
welfare benefits.
   (d) The agreement shall be approved by the board and, if approved,
no other entity licensed in this state shall be required to enter
into an agreement for the purposes of this section.
  SEC. 104.  Section 19613 of the Business and Professions Code is
amended to read:
   19613.  (a) Except as provided in subdivisions (b), (c), (d), (e),
and (f), the portion deducted for purses pursuant to this chapter
shall be paid to or for the benefit of the horsemen at the racing
meeting.
   (b) Any association other than a fair that conducts a thoroughbred
racing meeting shall pay to the owners' organization contracting
with the association with respect to the conduct of racing meetings
for administrative expenses and services rendered to owners, an
amount not to exceed two-thirds of 11/2 percent of the portion, and
to a trainers' organization for administrative expenses and services
rendered to trainers and backstretch employees an amount equivalent
to one-third of 11/2 percent of the portion.  That association shall
also pay an amount for a pension plan for backstretch personnel to be
administered by the trainers' organization equivalent to an
additional 1 percent of the portion.  The remainder of the portion
shall be distributed as purses.
   (c) Any other association may pay to the horsemen's organization
contracting with the association with respect to the conduct of
racing meetings for administrative expenses and services rendered to
horsemen an amount out of the portion as may be determined by the
association by agreement or otherwise, but, in all events, shall
include, relative to a thoroughbred horsemen's organization racing, 1
percent of the portion for a pension plan for backstretch personnel
to be administered by the trainers' organization.  The remainder of
the portion shall be distributed as purses.
   (d) Notwithstanding subdivisions (b) and (c), any association
conducting a fair racing meeting shall pay to the horsemen's
organizations contracting with the association with respect to the
conduct of races for their respective breeds of horses at the
meetings for administrative expenses and services rendered to their
respective horsemen those amounts out of the portion as determined by
the horsemen's organization for the respective breeds with the
approval of the board.
   Pursuant to this subdivision, amounts not to exceed 3 percent of
the portion for the owners' and trainers' organizations shall be
distributed to any thoroughbred owners' and trainers' organizations
contracting with an association for a fair racing meeting or
participating in mixed breed racing meetings as follows:  two-thirds
of 1 percent to the owners' organization and one-third of 1 percent
to the trainers' organization for administrative expenses and
services rendered to both owners and trainers, 1 percent for welfare
funds, and 1 percent for a pension program for backstretch personnel,
to be administered by the thoroughbred trainers' organization.
   (e) Any association other than a fair that conducts a quarter
horse racing meeting shall pay to the horsemen's organization
contracting with the association with respect to the conduct of
racing meetings for administrative expenses and services rendered to
horsemen, an amount not to exceed 3 percent of the portion. The
remainder of the portion shall be distributed as purses.
   (f) For racing meetings other than thoroughbred meetings, if no
contract has been signed between the association conducting the
racing meeting and the organization representing the horsemen by the
time the racing meeting commences, the distribution of purses shall
be governed by the following:
   (1) If the association conducted a racing meeting within the past
15 months and a contract was in existence for that meeting with the
horsemen's organization and the association is conducting a
subsequent meeting for the same breed or mixed breeds, the amounts
payable to the horsemen's organization under subdivision (c) shall be
computed under the provisions of the last signed contract between
the parties.
   (2) This subdivision applies regardless of the cause of the
failure to execute a contract, whether that failure is a result of
inadvertence or otherwise.
   (3) For racing meetings that do not come within paragraph (1), the
board shall, within 15 days after the commencement of the racing
meeting, determine the amounts payable to the horsemen's organization
for administrative expenses and services, and provide for the direct
payment of those amounts.
   (g) Amounts distributed pursuant to this section are derived from
owners' purses.
   (h) For the purposes of this section, the following definitions
shall apply:
   (1) "Owner" means a person currently licensed by the board as an
owner of a thoroughbred racehorse.
   (2) "Trainer" means a person currently licensed by the board as an
owner and trainer or as a trainer of a thoroughbred racehorse.
  SEC. 105.  Section 19614 of the Business and Professions Code is
amended to read:
   19614.  (a) Notwithstanding Sections 19611 and 19612, and except
for an association that qualifies pursuant to Section 19612.6, for a
fair conducting a live racing meeting, 1 percent of the total amount
handled on live races, excluding wagering at a satellite facility,
shall be retained by the fair association for payment to the state as
a license fee.
   (b) Additionally, 0.48 percent of the total amount handled on live
racing, excluding wagering at a satellite facility, shall be
deposited with the official registering agency pursuant to
subdivision (a) of Section 19617.2, and shall thereafter be
distributed in accordance with subdivisions (b), (c), and (d) of
Section 19617.2.
   (c) After distribution of the applicable amounts as set forth in
subdivisions (a) and (b) and the payments made pursuant to other
relevant sections of this chapter, all funds remaining from the
deductions provided in Section 19610 shall be distributed 47.5
percent as commissions and 52.5 percent as purses.  From the amount
distributed as thoroughbred purses, a sum equal to 0.07 percent of
the total handle shall be held by the association to be deposited
with the official registering agency pursuant to subdivision (a) of
Section 19617.2, and shall thereafter be distributed in accordance
with subdivisions (b), (c), and (d) of Section 19617.2.
   Any additional amount generated for purses and not distributed
during the previous corresponding meeting shall be added to the
purses at the current meeting.
   (d) In addition to the amounts deducted pursuant to Section 19610,
any fair racing association shall deduct 1 percent from the total
amount handled in its daily conventional and exotic parimutuel pools.
  The additional 1 percent shall be deposited in the Fair and
Exposition Fund and is hereby appropriated for the purposes specified
in Section 19630.
  SEC. 106.  Section 19614.2 of the Business and Professions Code is
amended to read:
   19614.2.  (a) In addition to the amounts otherwise deducted
pursuant to this chapter, a fair, or an association conducting its
meeting pursuant to Section 19549.1, may deduct from the total amount
handled in daily double, quinella, exacta, and other multiple
wagering pools approved by the board up to 3 percent thereof to be
distributed as additional commissions and purses in the current year
of the fair meet.  Of the amount deducted, if any, 52.5 percent shall
be distributed as additional purses and 47.5 percent shall be
distributed as additional commissions.  From the amount distributed
as thoroughbred purses, a sum equal to 0.07 percent of the total
amount handled shall be held by the association to be deposited with
the official registering agency pursuant to subdivision (a) of
Section 19617.2, and shall thereafter be distributed in accordance
with subdivisions (b), (c), and (d) of Section 19617.2.
   (b) At least 30 days prior to the commencement of its meeting, the
association shall file with the board a statement of the additional
deduction to be made pursuant to subdivision (a).  Except with the
consent of the board, the amount of the deduction shall not be
changed during the course of the meeting.
   (c) From the amount deducted for quarter horse purses under
subdivision (a), a sum equal to 25 percent thereof shall be paid as
breeder premiums and owners' and stallion awards as provided in
Section 19617.7, shall be deposited with the official registering
agency pursuant to subdivision (b) of Section 19617.7, and shall
thereafter be distributed in accordance with subdivisions (c), (d),
and (e) of Section 19617.7.
   (d) From the amount deducted for Arabian horse purses under
subdivision (a), a sum equal to 13.33 percent thereof shall be held
by the association to be deposited with the official registering
agency, pursuant to Section 19617.8, and thereafter shall be
distributed in accordance with Section 19617.8.  The board shall
designate the officially recognized organization representing Arabian
horsemen to administer this subdivision and to distribute premiums.
The organization may, with the approval of the board, make a
deduction for expenses of up to, but not to exceed, 10 percent of the
total awards fund.
   (e) From the amount deducted for Appaloosa horse purses under
subdivision (a), a sum equal to 13.33 percent thereof shall be paid
as breeder premiums and owners' and stallion awards as provided in
Section 19617.9, and shall be deposited with the official registering
agency pursuant to subdivision (b) of Section 19617.9, and shall
thereafter be distributed in accordance with subdivisions (c), (d),
and (e) of Section 19617.9.
   (f) Amounts distributed pursuant to this section are derived from
owners' purses.
  SEC. 107.  Section 19633 of the Business and Professions Code is
repealed.
  SEC. 108.  Section 19634 of the Business and Professions Code is
repealed.
  SEC. 109.  Section 19636 of the Business and Professions Code is
amended to read:
   19636.  All money appropriated pursuant to this article to the
California Exposition and State Fair, the Los Angeles County Fair,
the Sixth District Agricultural Association, known and designated as
the California Science Center, the citrus fruit fairs defined in
Section 4603 of the Food and Agricultural Code, and the 1-A District
Agricultural Association, is exempt from Section 16304 of the
Government Code, and shall remain available for expenditure from year
to year until expended.
  SEC. 110.  Section 19637 of the Business and Professions Code is
amended to read:
   19637.  Appropriations and allocations from the Fair and
Exposition Fund made pursuant to this article, other than those made
under subdivision (b) of Section 19620 are exempt from the provisions
of Section 16304 of the Government Code.  The date of such executive
order is deemed to be the date when the appropriation becomes
available for expenditure.
   All appropriations and allocations made by this article which are
not exempted by this section from the provisions of Section 16304 of
the Government Code are subject to those provisions.
  SEC. 111.  Section 19660 of the Business and Professions Code is
amended to read:
   19660.  Any person who, without first having procured a license
under Article 4 of this chapter, directly or indirectly holds or
conducts any meeting where there is horse racing and betting on its
results by the parimutuel method of wagering, or otherwise, is guilty
of a misdemeanor.
  SEC. 112.  Section 19662 of the Business and Professions Code is
amended to read:
   19662.  Any person who bets upon the results of a horse race
except by a parimutuel method of wagering conducted by a person
licensed under Article 4 of this chapter is punishable as provided in
the Penal Code.
  SEC. 113.  Section 19664 of the Business and Professions Code is
amended to read:
   19664.  It is unlawful for any person, for the purpose of selling
or offering to sell predictions on horse races, to advertise that he
has predicted the outcome of any horse race which has been run in
this state, unless such person has notified in writing the California
Horse Racing Board, at any of its offices, of his predictions at
least three hours prior to the race involved on forms prescribed by
the board.  No person shall advertise the fact that he has notified
the board or use the name of the board in any way whatsoever to
promote the activities described in this section.
   For the purposes of this section the term "advertise" includes the
use of a newspaper, magazine or other publication, book notice,
circular, pamphlet, letter, handbill, tip sheet, poster, bill, sign,
placard, card, label, tag, window display, store sign, radio or
television announcement, or any other means or methods now or
hereafter employed to bring to the attention of the public
information concerning the outcome of horse races.
   Nothing herein contained shall apply to any daily newspaper of
general circulation which is regularly entered in the United States
mail, or any other daily publication carrying complete past
performances of horses entered in races, or to any regularly
published magazine or periodical devoted to racing news, which
magazine or periodical has been published for at least two years.
   Violation of this section is a misdemeanor.
  SEC. 114.  Section 522 of the Food and Agricultural Code is amended
to read:
   522.  When a central diagnostic laboratory constructed on the
Davis campus of the university is ready for occupancy, the director
shall contract with the Regents of the University of California for
its School of Veterinary Medicine to establish and operate the
California Animal Health and Food Safety Laboratory.  The system
shall be headed by a director appointed by the Dean of the School of
Veterinary Medicine under applicable university hiring rules.  The
system shall test, examine, and make diagnoses of infectious,
nutritional, toxic, metabolic, and other diseases of domestic
animals.
  SEC. 115.  Section 529 of the Food and Agricultural Code is amended
to read:
   529.  It is intended that the contractual arrangement between the
university and the department be of long-term duration.  The
department's budget for the laboratories shall be reviewed annually.

   A Veterinary Diagnostic Laboratory Board is hereby established,
consisting of representatives of the livestock and poultry industries
and practicing veterinarians who utilize the laboratory service.  It
shall be appointed by the director in consultation with the Dean of
the School of Veterinary Medicine.  The Chief of the Bureau of Animal
Health of the department, the Assistant Area Veterinarian in Charge
for California for the United States Department of Agriculture, and
the director of the California Animal Health and Food Safety
Laboratory created by this article shall be ex officio members.  The
board shall advise the university and the department on all aspects
of the operation of the laboratories.
  SEC. 116.  Section 531 of the Food and Agricultural Code is amended
toread:
   531.  The budget for the California Animal Health and Food Safety
Laboratory shall be established as a line item in the budget of the
department.  The operating budget requests shall be submitted
annually, and requests for funding of construction of facilities and
special items of laboratory equipment which cost over one hundred
fifty thousand dollars ($150,000) shall be submitted when required.
The director shall transfer funds appropriated for operation of the
laboratories, for equipment, and for construction of facilities to
the university to be managed according to university rules and
regulations, and in accordance with the contract between the
department and the university.