BILL ANALYSIS                                                                                                                                                                                                    






                                                       Bill No:  AB  
          136
          
                 SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
                       Senator Roderick D. Wright, Chair
                           2009-2010 Regular Session
                                 Staff Analysis



          AB 136  Author:  Silva
          As Amended:  June 1, 2009
          Hearing Date:  June 23, 2009
          Consultant:  Chris Lindstrom


                                     SUBJECT  

             Horse racing: imported harness or quarter horse races.

                                  DESCRIPTION
           
          AB 136, an urgency measure, adds a new section to Horse  
          Racing Law to prohibit the racing of cloned horses or the  
          offspring of cloned horses regardless of whether any breed  
          association has registered the horse.  AB 136 also deletes  
          the limitation on the total number of out-of-state or  
          out-of-country harness or quarter horse races that may be  
          imported in a calendar year by a harness or quarter horse  
          racing association.  

                                   EXISTING LAW

           Article IV, Section 19(b) of the Constitution of the State  
          of California provides that the Legislature may provide for  
          the regulation of horse races and horse race meetings and  
          wagering on the results.

          Existing law provides that the California Horse Racing  
          Board (CHRB) regulate the various forms of horse racing  
          authorized in this state.

          Existing law provides CHRB is authorized to permit a  
          harness or quarter horse association conducting a race  
          meeting to accept wagers on the results of up to eight  
          out-of-state or out-of-country harness or quarter horse  




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          races per day, if specified conditions are met.  If only  
          one breed is being raced on a given day, the racing  
          association conducting live racing may import those races  
          that would otherwise be simulcast by the association that  
          is not racing, as specified.

          Existing law provides the total number of harness or  
          quarter horse races imported in a calendar year may not  
          exceed the number of night races imported in 1998 after  
          5:30 p.m.

          Existing law authorizes a licensed harness racing  
          association that is conducting a live racing meeting in  
          this state to accept wagers on the full card of races  
          conducted by another racing association on the day that  
          other association conducts the Breeder's Crown Stakes, the  
          Meadowlands Pace, the Hambletonian, or the North American  
          Cup.

          Existing law authorizes a licensed quarter horse racing  
          association that is conducting a live racing meeting in  
          this state to accept wagers on races conducted by the  
          racing association that conducts the American Quarter Horse  
          Racing Challenge if the races are conducted on the same day  
          as the American Quarter Horse Racing Challenge.

          Existing law recognizes the Jockey Club of New York as the  
          official registering agency for Thoroughbred horses.

                                    BACKGROUND
           
          Purpose of the bill.  According to the author, "the Jockey  
          Club, which is the registration association for  
          thoroughbred horses, only allows a foal to be registered if  
          the mare was live-serviced by the stallion.  Thus, they do  
          not permit artificial insemination.  In addition, cloned  
          horses may not race in harness races.  Prohibiting cloned  
          quarter horses or the offspring of cloned quarter horses  
          from racing in California will bring quarter horse racing  
          up to the same standard as thoroughbred and harness racing.  
           This will help protect the integrity of the California  
          quarter horse racing industry."

          "Further, according to the author's office, "by allowing  
          race tracks to increase the number of harness or quarter  
          horse races on which they can provide satellite wagering,  




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          this bill makes up, in part, for the closing of Bay  
          Meadows.  Current law allows harness and quarter horse  
          racing associations and fairs to offer wagering on eight  
          harness or quarter horse races broadcast by satellite on  
          each day live races are being run.  Los Alamitos Race  
          Course and Sacramento/Cal Expo are the only racetracks that  
          conduct harness racing and quarter horse racing meets.  By  
          providing for the importation of additional out-of-state  
          and out-of-country races, this bill would authorize  
          additional wagering."

          Background.  In general, in order for a horse to compete in  
          a horse race in California, the horse must be registered by  
          the respective breed registry (thoroughbreds, quarter  
          horses, or standard breds (harness racing)), must be owned  
          and trained by persons whose licenses are in good standing  
          with CHRB, and the horse must meet the conditions of the  
          race.  Currently, none of the breed registries for horses  
          allows cloned horses to be registered.  

          On March 9, 2009, the American Quarter Horse Association  
          Board of Directors voted that action on a member proposal  
          to approve the registration of foals produced by cloning  
          will be delayed until the 2010 AQHA Annual Convention.  In  
          the interim, the board recommended the appointment of a  
          task force to continue to seek information and input from  
          informed sources regarding cloning, and to conduct further  
          study of, among other things, parentage verification  
          issues, the implications of cloning on the registration  
          process, sentiment of the general membership, the impact of  
          cloning with respect to genetic diseases, and to continue  
          the effort to educate the general membership regarding  
          cloning and its potential effect on the breed, the  
          Association and its members.  Rule 227(a) of the AQHA  
          Official Handbook, a rule that became effective in 2004,  
          provides that American Quarter Horses produced by any  
          cloning process are not eligible for registration.

          In addition, AB 2048 (Silva), Chapter 439, Statutes of 2008  
          increased by two (from six to eight) the number of races  
          that a harness and quarter horse racing association could  
          import on live racing days from out-of-state and  
          out-of-country locations.  Under current law, however,  
          there is a limitation on the total number of races that can  
          be imported, annually, which prohibits harness and quarter  
          horse racing from taking advantage of the additional two  




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          races per day allowed in AB 2048.  By removing that annual  
          limitation, AB 136 is intended to allow the intent of AB  
          2048 to be fully implemented.

          Arguments in support.  According to the sponsor of the  
          bill, "It is important to maintain the ethical integrity of  
          horse racing in California.  Although no cloned horses  
          actually run in California, banning the racing of cloned  
          horses or their offspring will perpetuate the purity of the  
          "sport of kings".

          The Pacific Coast Quarter Horse Racing Association argues  
          that AB 136 is necessary for the following reasons:

               Parents of a cloned foal cannot be verified.  When a  
              foal is born you can not verify if the sire was the  
              actual horse or a cloned offspring.  The industry is  
              defined on being able to determine the parents.
               Protecting the integrity of racing and the betting  
              pools would be impossible because you would not have  
              sufficient information regarding the parents of the  
              racing horse.
               Eggs are harvested from expired mares.  Up to 200  
              eggs may be used but out of that number only 1 or 2  
              embryos will mature.  There is no way of knowing which  
              mare's egg the embryo came from or the exact genetic  
              material.  This will have a negative impact on the gene  
              pool.
               The economics of the industry would be greatly  
              affected.  An individual selling a yearling prospect  
              could pull cells, harvest them, and be in direct  
              competition with the individual who purchased the  
              horse.  A stallion owner may clone his stallion and  
              extract semen from the clone and sell it as the  
              original.  There is no way of determining the  
              difference between them which would be very destructive  
              to the economic structure of our industry.
               Through the natural breeding process our product has  
              improved.  Cloning would be a reverse process by using  
              horses from the past and not moving forward and  
              expanding the gene pool.

          Arguments in opposition.  Vessels Stallion Farm writes,  
          "the decisions related to the registration of cloned horses  
          should be left up to the breed registries, such as AQHA,  
          Jockey Club (for Thoroughbreds) and others.  The AQHA  




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          currently has a rule in place that does not allow the  
          registry of a cloned horse.  If you cannot register a  
          horse, you cannot race him.  As a member of the Stud Book  
          and Registration Committee with the AQHA, we are currently  
          studying this and should come up with a decision at our  
          next convention in Florida in March 2010.  Currently, it is  
          Mr. Vessels' belief that the rule will not be changed from  
          its current form."

          The Biotechnology Industry Organization (BIO) argues that  
          "this bill is unprecedented, unnecessary and fiscally  
          irresponsible.

          "For over 70 years, the horse racing registration process  
          has primarily been left to private associations.  This  
          would be the first bill, and thus the only statutory  
          language, which specifically prohibits a method of  
          husbandry.  We can see no compelling reason for either the  
          Legislature or the horse racing industry to make such a  
          radical paradigm shift at this time.

          "Currently, none of the three primary registration  
          organizations register cloned horses.  Thus, cloned horses  
          cannot race in thoroughbred, quarter horse or harness  
          racing.  This bill prohibits a practice that is already  
          prohibited.  While BIO certainly disagrees with the  
          positions taken by these organizations we nonetheless  
          respect their autonomy.  We also think that any future  
          developments and changes in breeding practices should be  
          handled by the organizations that were specifically  
          designed to address these questions.  This process has been  
          successful for multiple decades and should be allowed to  
          continue."

                            PRIOR/RELATED LEGISLATION
           
           AB 2048 (Silva), Chapter 439, Statutes of 2008  .  Allows a  
          harness and quarter horse racing association to import an  
          additional two races, from six to eight, on live racing  
          days from out-of-state or out-of-country locations.

           SB 1183 (Margett), Chapter 232, Statutes of 2004  .   
          Authorizes a harness racing association that is conducting  
          a live race meeting to accept wagers on the full card of  
          races conducted by another racing association on the day  
          the other racing association conducts the Breeder's Crown  




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          Stakes, the Meadowlands Pace, the Hambletonian or the North  
          American Cup.

           SB 2035 (Karnette), Chapter 268, Statutes of 2002  .  Allows  
          a harness or Quarter Horse racing association to "bank" up  
          to two out-of-state or out-of-county imported races on a  
          specific race day, and then add those races to another race  
          day's importation schedule.

           SUPPORT:   As of June 19, 2009:

          California Harness Horsemen
          Los Alamitos Race Course (sponsor)
          Pacific Coast Quarter Horse Racing Association
          Thoroughbred Owners of California

           OPPOSE:   As of June 19, 2009:

          Biotechnology Industry Organization
          California Coalition Against Gambling Expansion
          Geron Corporation
          Vessels Stallion Farm

           FISCAL COMMITTEE:   Senate Appropriations Committee



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