BILL ANALYSIS
SB 561
Page 1
SENATE THIRD READING
SB 561 (Margett)
As Amended July 15, 2008
2/3 vote. Urgency
SENATE VOTE :34-1
GOVERNMENTAL ORGANIZATION 13-0 APPROPRIATIONS 15-0
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|Ayes:|Price, Plescia, Charles |Ayes:|Leno, Walters, Davis, |
| |Calderon, Davis, De Leon, | |DeSaulnier, Emmerson, |
| |Evans, Garcia, Jeffries, | |Furutani, Huffman, |
| |Levine, Mendoza, | |Karnette, Krekorian, La |
| |Portantino, Silva, Tran | |Malfa, Lieu, Ma, |
| | | |Nakanishi, Nava, Solorio |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Changes the number of live racing days that maybe
allocated by the California Horse Racing Board (CHRB) to a
Thoroughbred or fair racing association in the northern zone.
Specifically, this bill :
1)Allows an association licensed to conduct Thoroughbred racing
in the northern zone up to 35 weeks of racing.
2)Expands the maximum period for racing allocated to a fair to
four weeks each year and would remove the prohibition on
racing outside of the period in which general fair activities
are conducted.
3)Authorizes combined fair horse racing meetings during the
month of June, and would delete that limitation on the total
combined number of dates for combined fair horse racing
meetings.
4)Contains an urgency clause, allowing this bill to take effect
immediately upon enactment.
EXISTING LAW :
1)Provides that CHRB regulate the various forms of horse racing
authorized in this state.
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2)Allows CHRB to allocate a maximum of 14 days of horse racing
to any fair association in the northern zone. The racing
dates shall be days during the period in which general fair
activities are conducted.
3)Provides that 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 racing dates shall be days during the period in
which general fair activities are conducted.
4)Permits CHRB to allocate horse racing dates for combined fair
race meetings under the following conditions:
a) CHRB will only allocate combined fair race meeting dates
between July 1 and October 31; and,
b) The total combined number of dates shall not exceed the
total dates of the combined fair racing associations in
1995.
1)Permits the San Mateo County Fair to conduct a live racing
meeting in the northern zone at another site within or outside
San Mateo County if its present site, Bay Meadows, closes.
2)Authorizes the Solano County Fair to conduct live racing
meetings at another site within or outside Solano County, if
the site of its 2002-racing meeting is no longer available for
horse racing in any subsequent year.
3)Limits an association licensed to conduct Thoroughbred racing
in the northern zone to 22 weeks of that racing.
4)Requires CHRB or its subcommittees, to take public testimony
and make all determinations on the allocation of racing dates
during a public hearing.
FISCAL EFFECT : Potential increase in state license fee
revenues from increased wagering opportunities.
COMMENTS :
Purpose of this bill : According to the author, in view of the
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prevailing economic condition of horse racing in California, it
might be worthwhile for CHRB to grant fairs and Thoroughbred
association's greater flexibility to conduct live horse racing
activities in northern California. Currently, a fair may not
run more than 14 days and must operate those dates during the
time the fair is operating. If enacted, this bill would allow
CHRB to allocate up to four weeks of racing (28 days) to a fair
in the northern zone even if the fair is not conducting any type
of fair activities. The bill would also allow a Thoroughbred
racing association in the northern zone to increase the number
of racing weeks they may run from 22 to 35 weeks.
The author states, due to the imminent closure of Bay Meadows
Racetrack in San Mateo for commercial and residential
development in November 2008, it is necessary to expand the
number of racing weeks that can be potentially allocated to a
fair or private association in the northern racing zone.
Without the ability to race those days previously utilized by
Bay Meadows Racing Association, Thoroughbred racing in the
northern California would have to cease for specific days in the
racing calendar.
Currently, Bay Meadows Racetrack runs approximately 100 days of
racing per year; it also houses hundreds of horses year-round in
its stable area. Without Bay Meadows, the only major
Thoroughbred track in northern California will be Golden Gate
Fields in Albany, which is owned by Magna Entertainment and runs
approximately 100 days of live racing each year. It is expected
that Golden Gate Fields, the Alameda County Fair and the Sonoma
County Fair will have bigger roles in future years as it relates
to racing dates and/or the stabling and training of racehorses.
There is an abundance of testimony in the legislative record
regarding the economic condition of the horseracing industry,
and specifically, the direct impact on the allocation of race
dates. The Division of Fairs and Expositions within the
Department of Food and Agriculture completed an overall analysis
of live horse racing at fairs and concluded among other things,
that the activity is extremely important to a fairs financial
viability.
This bill will give the CHRB the flexibility to allocate race
dates in the northern zone in a manner that protects the
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interests of all who work and race in northern California.
There are large questions that need to be answered in
California's racing industry relating to its future. The
industry is in the process of identifying what the possibilities
are and deciding which ones are realistic and which ones are
unrealistic.
Background : Historically, since the advent of pari-mutual
wagering in California in 1933, various fairs throughout the
state have been allocated racing dates by CHRB to be held in
conjunction with their fair dates. Currently, CHRB allocates
racing dates to nine fairs throughout California. Granting
additional flexibility to CHRB and the fairs relating to the
allocation of race dates is not a new concept. AB 3090
(Machado), Chapter 741, Statutes of 1996, allows CHRB to
allocate horse racing days for combined fair horse racing
meetings. For example, if the CHRB allocates the Solano County
Fair 10 days of racing and the California Exposition and State
Fair 12 days of racing, those two entities can combine their
allocated dates and operate 22 days of live racing at either
facility.
Racing at fairs : Today, eight fairs conduct live racing in
northern California during the run of its fair. The northern
California fair circuit includes 87 days of Thoroughbred and
other breed racing at the following fairs: San Joaquin County
(Stockton); Alameda County (Pleasanton); Solano County
(Vallejo); Sonoma County (Santa Rosa); San Mateo County (San
Mateo); Humboldt County (Ferndale); California Exposition and
State Fair (Sacramento); and, the Big Fresno Fair (Fresno).
Related legislation : AB 3073 (Assembly Governmental
Organization Committee) of 2008, allows a fair racing
association to conducted racing during a period when general
fair activities are not being conducted. (Senate Floor)
AB 2205 (Garrick) of 2008, provides that, if a Thoroughbred
racing venue in the central zone in 2008 is not available for
racing in 2009 or thereafter, the dates formerly allocated to
that venue shall be available for allocation to other
associations or fairs. (Assembly Floor)
Prior legislation : AB 765 (Evans), Chapter 613, Statutes of
2007, in addition to reauthorizing Advance Deposit Wagering, the
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bill allowed a fair, combination of fairs, or an association
conducting racing at a fair, may, with CHRB approval, deduct an
additional 1% from its handle, to be used for maintenance and
improvements at a fair's racetrack inclosure, as specified.
SB 1227 (Soto), Chapter 918, Statutes of 2004, allows the Los
Angeles County Fair Association (LACFA/Fairplex) to retain any
increases above the 2004 level of the license fees for payment
of a capital expense loan. Any portion of the license fees in
excess of the loan payment amount will be deposited into the
Fairs and Exposition Fund for CHRB administrative costs.
Analysis Prepared by : Eric Johnson / G. O. / (916) 319-2531
FN: 0006038