BILL ANALYSIS
AB 2258
Page 1
Date of Hearing: April 30, 2008
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mark Leno, Chair
AB 2258 (Evans) - As Amended: April 3, 1008
Policy Committee: Governmental
OrganizationsVote: 12 - 0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill clarifies language in current horse racing law
relating to the amount of license fees that must be paid to the
state by racing associations and fairs in any calendar year.
Specifically, this bill:
States that if the total amount paid to the state in licensing
fees by racing associations and fairs is less than $40 million
in a calendar year, all associations and fairs that conduct live
racing during the year of the shortfall must remit to the state,
on a pro rata basis according to the amount paid as license fees
by each entity, the amount necessary to bring the total to $40
million.
FISCAL EFFECT
There are no significant state costs associated with this
legislation.
COMMENTS
1)Purpose . According to the author, there is some confusion
within California's horse racing industry regarding what
payments to the state shall be used to support the state's
network of fairs. Some parties within the industry believe
that current statute stipulates that all money collected by
the state should be used in the calculation, while others,
including the sponsor of the bill (the California Authority of
Racing Fairs), believe that only license fees paid to the
state are to be used in the $40 million calculation. The
intent of this bill is to clarify that issue.
AB 2258
Page 2
2)Revenue Shortfalls . In January of last year, the CHRB sent
letters to each racing association and fair regarding the
shortfall for calendar years 2005 and 2006. The CHRB stated
that cash receipts for calendar years 2005 and 2006 to the
State of California fell short of the $40 million by a
combined total of $1,528,187. Each racing association and fair
was requested to submit to the CHRB their pro rata share of
the shortfall.
As of March 1, 2007, the CHRB had received six remittances
totaling $101,367. Some associations questioned the CHRB about
the dollar amounts reported. They cited the CHRB Annual
Reports which show amounts above the $40 million baseline.
Those reports include receipts other than amounts deposited to
the Fair and Exposition Fund, Satellite Wagering Account, and
Equine Research Fund.
3)Related Legislation . SB 1825 (Kelley; Chapter 342, Statutes of
2000) provides for a minimum of $40 million per year in
license fees paid to the state by racing associations and
fairs for support of the Network of California Fairs, CHRB,
and the Kenneth L. Maddy Equine Research Facility at U.C.
Davis.
SB 27 (Maddy; Chapter 335, Statutes of 1998) provided
extensive license fee relief ($40 million annually) to the
horse racing industry in California.
Analysis Prepared by : Julie Salley-Gray / APPR. / (916)
319-2081