BILL ANALYSIS
AB 763
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 763 (Chesbro)
As Amended July 9, 2009
2/3 vote. Urgency
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|ASSEMBLY: |78-0 |(May 11, 2009) |SENATE: |> |(>) |
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Original Committee Reference: G.O .
SUMMARY : Allows the Humboldt County Fair (HCF) to import and
accept wagers on up to eight races per day from out-of-state
locations, as specified. In addition, allows a Thoroughbred
association in the southern zone to import and accept wagers on
an additional eight races from out-of-state locations during the
period that HCF is conducting a live race meet, as defined.
Specifically, this bill :
1)Provides that during calendar periods when a thoroughbred
association or fair in the northern zone and the HCF
simultaneously conduct live race meetings, the HCF and a
Thoroughbred association in the southern zone when conducting
a live race meeting may accept wagers on the result of
out-of-state Thoroughbred horse races, if all of the following
conditions are met:
a) Specifies that the HCF conducts at least six live races;
and, the fair and the Thoroughbred association in the
southern zone import not more than eight out-of-state races
on those days during a racing meeting when live races are
being run;
b) Provides the HCF and Thoroughbred association in the
southern zone shall accept wagers on out-of-state
Thoroughbred races commencing before 4:30 p.m., Pacific
Standard Time, without the consent of an association that
is then conducting a live racing meeting in this state;
and,
c) Provides the HCF may contract with the Thoroughbred
association or fair in the southern zone to distribute the
signal statewide on its behalf, as defined.
1)Maintains a financial payment to the HCF from purses and
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commissions generated from the wagering handle on imported
races at the host track in northern California during the
period the HCF is overlapped by another fair or thoroughbred
association in the northern zone. Previously the payment has
been from license fees before the enactment of SB 16XX
(Ashburn) of 2009.
The Senate amendments :
1)Provide the HCF shall receive an amount equal to 0.75% of the
out-of-zone, out-of-state, and out-of-country handle from, and
to the extent of, commissions and purses generated from the
total handle of another fair or thoroughbred association while
simultaneously conducting a race meet in the northern zone.
2)Delete provision relating to the fee paid to the Fresno
District Fair from wagers on out-of-zone, out-of-state, and
out-of-country races while simultaneously conducting a race
meet with another fair or thoroughbred association. The
payment is no longer needed because the fair is no longer
overlapped by a fair or racing association in the northern
zone while conducting a live race meet.
3)Add an urgency clause allowing this bill to take effect
immediately upon enactment.
AS PASSED BY THE ASSEMBLY , this bill allowed the HCF to import
and accept wagers on up to eight races per day from out-of-state
locations, as specified. In addition, allows a Thoroughbred
association in the southern zone to import and accept wagers on
an additional eight races from out-of-state locations during the
period that HCF is conducting a live race meet, as defined.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, potential increase in revenue available to fund the
CHRB and the Kenneth L. Maddy Equine Analytical Laboratory at
the University of California, Davis due to increased wagering
opportunities.
COMMENTS : The sponsor of this bill, the Humboldt County Fair
Association, a non-profit organization that has provided the
management arm of the annual HCF in Ferndale for 114 years.
Horse racing has been an integral and essential part of the HCF
since its inception in 1896. Due to recent and dramatic changes
in horse racing, however, the fair faces the very real
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possibility of losing this important activity.
HCF states, "The new revenues generated from this bill would be
essential to our bottom-line and would provide the basis for
continuing with the great tradition of horse racing at the fair
to be enjoyed by generations to come." HCF further states that
revenues derived from this bill will not only support the fair
but the breeding, owning and racing of California horses and
mules while supplementing the existing breeding incentive
programs. This bill will allow the HCF to import up to eight
out-of-state races, which is similar to the right held by
harness or quarter horse associations while operating a CHRB
sanctioned live racing meet.
After a record-breaking meet in 2007, when total handle exceeded
$4.2 million, HCF finished 2008 with total handle of $3.6
million. One reason for the decline was a decrease in the
number of horse racing at the fair meet. HCF had a difficult
time drawing horses from northern California's limited supply
because they operate at the same time as another fair. There
were 442 runners for the 2008 meet, compared to 504 in 2007.
This trend is common for all live horse racing meets in
California.
This bill will give the HCF a marketing tool to increase
on-track and off-track attendance because quality races from an
out-of-state location would be able to be offered to their
wagering patrons to offset less live races and overall wagering
opportunities. Bottom line, this bill will give the HCF a
mechanism to increase track commissions and purses while
operating a live race meet.
Background. In the late 1990's, California racetracks began
importing additional races from out-of-state and out-of-country
locations to provide California's horse racing patrons with the
opportunity to wager on quality races offered by racetracks
throughout the country. Since the introduction of this practice
(which, incidentally is authorized in many other states that
likewise allow pari-mutuel wagering on horse races), wagering on
these out-of-state races has been well received by the betting
patron, even though overall wagering in California is in
decline. In general, allowing wagering on races from
out-of-state locations has helped the industry offset a
continued reduction in on-track wagering activity and a
diminishing horse population.
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Under current law, a Thoroughbred racing associations or fair is
allowed to distribute the audiovisual signal and accept wagers
on the results of out-of-state (up to 32 per day) and
international Thoroughbred races (unlimited) during the calendar
period the association or fair is conducting live racing,
including days on which there is no live racing being conducted
by the association or fair. Current law also allows harness or
quarter horse associations conducting a live race meet to accept
wagers (up to eight per day) on the results of out-of-state and
out-of-country races, if specified conditions are met.
The HCF though has not been able to import additional races as
other racing associations in California have been allowed to do
and in essence have lost out on the opportunity to generate
additional revenues for the fair and horsemen.
Live fair racing in northern California. 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 seven fairs in
northern California. The northern California fair circuit
includes 69 days of Thoroughbred and other breed racing on the
grounds of the following fairs: San Joaquin County (Stockton);
Alameda County (Pleasanton); Solano County (Vallejo); Sonoma
County (Santa Rosa); Humboldt County (Ferndale); California
Exposition and State Fair (Sacramento); and, the Big Fresno Fair
(Fresno).
Analysis Prepared by : Eric Johnson / G. O. / (916) 319-2531
FN: 0001914