BILL ANALYSIS
Bill No: AB
1792
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Roderick D. Wright, Chair
2009-2010 Regular Session
Staff Analysis
AB 1792 Author: Silva
As Amended: June 22, 2010
Hearing Date: June 29, 2010
Consultant: Art Terzakis
SUBJECT
Horse racing: license fee reduction: quarter horse racing
DESCRIPTION
AB 1792 increases from 2.5 % to 3 %, the amount of the
takeout that the quarter horse racing association can
redirect for California breeders' awards.
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 authorizes parimutuel wagering on horse racing
at or disseminated by licensed racing associations and
fairs. Racing was legalized through constitutional
amendment in 1933. The California Horse Racing Board (CHRB)
has complete jurisdiction and supervision over all racing
activities to the State of California.
Existing law provides, under the Horse Racing Law, 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 CHRB, as specified.
Existing law provides that, notwithstanding any other law
and in lieu of any license fee payable to the state
AB 1792 (Silva) continued
Page 2
prescribed for or referred to in specified provisions of
the Horse Racing Law, any association or fair that conducts
a racing meeting shall pay its proportional amount, as
determined by the formula devised by the CHRB in
consultation with the industry, as a license fee to the
state to fund the board and the equine drug testing
program, as provided.
Existing law provides that the license fee reductions
resulting from these provisions, after payments to fund the
board and the equine drug testing program, shall be
distributed as specified for thoroughbred racing, quarter
horse racing, harness racing, and all other breeds. For
quarter horse racing, 2.5% of the amount of the reduction
is required to be deposited with the official registering
agency and distributed as provided.
BACKGROUND
Purpose of AB 1792: According to the sponsor, the Pacific
Coast Quarter Horse Racing Association (PCQHRA), this
measure is necessary to address a specific section of
current law enacted in 2009 [SB 16 X2 (Ashburn), Chapter
12, Statutes of 2009 Second Extraordinary Session] dealing
with incentives for Cal-bred quarter horses.
SB16 X2 (Ashburn) shifted the horse racing industry's
obligation ($40 million) to fund state and county fairs
from licensing fees, paid by the associations or fairs
while operating live race meets into the General Fund. One
component of the bill required that a specific percentage
of the license fee reduction (resulting from the General
Fund assuming the fair funding obligation) be distributed
to the official registering agencies for the specific
breeds of horses which race in California.
Currently, 2.5% is set aside for the quarter horse
registering agency, the PCQHRA. This measure seeks to
increase the amount from 2.5% to 3%. The 3% will conform
to the amount of money which is paid to the thoroughbred
breeders' organization for the same license fee reduction
in 2009. The increased deposit will help to incentivize
breeding and racing of quarter horses within California.
This measure has no financial relationship to the General
Fund.
Arguments in Support: The sponsor of the bill, the Pacific
AB 1792 (Silva) continued
Page 3
Coast Quarter Horse Racing Association (PCQHRA) writes, "AB
1792 is a technical clean-up bill to SB2X 16 which was
signed into law last year. SB2X 16 initially provided the
license fee reduction "savings" be split 48.75% each for
commissions and purses with 2.5% to breeders for quarter
horses. All other breeds were split 48.5% each to purses
and commissions and 3.0% to breeders. Since then, with the
approval of the CHRB, we have been using 3.0% to conform to
the other breeds. AB 1792 simply codifies the change into
law.
PRIOR/RELATED LEGISLATION
SB 16xx (Ashburn) Chapter 12, Statutes of 2009-10 Second
Extraordinary Session . Among other things, provided that
beginning on July 1, 2009, and annually thereafter,
thirty-two million ($32,000,000) shall be appropriated from
the state's General Fund and paid into the Fair and
Exposition Fund for the financial support of the network of
California fairs.
SUPPORT: As of June 25, 2010:
Pacific Coast Quarter Horse Racing Association
Los Alamitos Race Course
OPPOSE: None on file as of June 25, 2010.
FISCAL COMMITTEE: Senate Appropriations Committee
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