BILL ANALYSIS �
Bill No: AB
562
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Roderick D. Wright, Chair
2011-2012 Regular Session
Staff Analysis
AB 562 Author: Hall
As Introduced: February 16, 2011
Hearing Date: June 28, 2011
Consultant: Art Terzakis
SUBJECT
Horse Racing: Wood Memorial
DESCRIPTION
AB 562 adds the Wood Memorial to the group of stake races
in Horse Racing Law which are exempt from the 32-race per
day limit on imported races, as defined.
EXISTING LAW
Existing law grants the California Horse Racing Board
(CHRB) the authority to regulate the various forms of horse
racing authorized in this state.
Existing law limits the number of races that may be
imported by associations and fairs to no more than 32 races
per day on days when live Thoroughbred or fair racing is
being conducted in this state, with specified exceptions.
Existing law exempts from that 32-race per day limit races
imported that are part of the race card of certain
prominent races, including the Kentucky Derby, the Kentucky
Oaks, the Preakness Stakes, the Belmont Stakes, the Jockey
Club Gold Cup, the Travers Stakes, the Breeders' Cup, the
Dubai Cup, or the Haskell Invitational.
Existing law authorizes Thoroughbred racing associations or
fairs to distribute the audiovisual signal and accept
wagers on the results of out-of-state and international
Thoroughbred races during the calendar period the
association or fair is conducting live racing, including
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days on which there is no live racing being conducted by
the association or fair.
BACKGROUND
Wood Memorial Stakes: The Wood Memorial Stakes is a Grade
1 stakes race for three-year-old thoroughbreds, located at
the Aqueduct Racetrack in Queens, New York. Each April,
this prestigious race acts as a major prep for
three-year-old horses with eleven winners having gone on to
victory in the Kentucky Derby, four of whom captured the
Triple Crown. The race is shown each year on ESPN.
Purpose of AB 562: This measure provides that all races
imported by a Thoroughbred association or fair that are
part of the race card of the overall Wood Memorial day
would be exempted from the 32-race per day limit as defined
in current law. Over the years, this law has been amended
to allow specific notable races to be imported outside of
this cap for promotional and financial reasons.
The author's office notes that AB 562 will help increase
the wagering handle on this specific day (Wood Memorial
Stakes) which will lead to increased purses, racetrack
revenue, and breeders' awards in California. Purses are
important to California's racing industry because they
provide revenue to horse owners for their racing operations
and to breeders through an increase in the value of their
breeding stock. The author's office states "California's
racing industry has found that it's much easier to make a
big day bigger relative to their marketing efforts rather
than trying to increase attendance on a typical Wednesday
or Thursday." The author's office believes that AB 562
will also provide the racing industry a marketing tool to
increase on-track and off-track attendance on this
designated day because racing fans will want to wager on
all the races from the host track of the prestigious Wood
Memorial horse race.
Satellite Wagering: Satellite wagering via an off-track
facility has been legal in California since 1985. It was
authorized at a time when California racetracks were
beginning to experience declining attendance and handle
figures. The industry believed that making the product
easier to access not only would expose and market horse
racing to potential customers, but also would make it more
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convenient for the existing patrons to wager more often.
Simulcasting : Simulcasting is the process of transmitting
the audio and video signal of a live racing performance
from one facility to a satellite for retransmission to
other locations or venues where parimutuel wagering is
permitted. Simulcasting provides racetracks with the
opportunity to increase revenues by exporting their live
racing content to as many wagering locations as possible,
such as other racetracks, fair satellite facilities and
Indian casinos. Revenues are increased because
simulcasting provides racetracks that export their live
content with additional customers in multiple locations who
otherwise would not have been able to place wagers on the
live racing event.
Racetrack Attendance: Over the past 20 years the industry
has witnessed a general decline in the number of people
attending and wagering at live horse racetracks in
California due to a number of factors, including increased
competition from other forms of gaming, unwillingness of
customers to travel a significant distance to racetracks
and the availability of off-track wagering. The declining
attendance at live horse racing events has prompted
racetracks to rely on revenues from in-state and
out-of-state satellite wagering and account wagering.
PRIOR/RELATED LEGISLATION
AB 707 (Garrick) 2011-12 Session. Would increase from 32
to 50, the limitation on the total number of out-of-state
Thoroughbred races that may be imported per day by a
Thoroughbred association or fair that is conducting a live
race meet with approval by the CHRB. (Pending in this
Committee)
AB 2790 (Committee on Governmental Organization) Chapter
141, Statutes of 2010. Added the Arlington Million to the
group of specific stake races which are exempt from the
32-race per day limit on imported races.
AB 3074 (Committee on Governmental Organization) Chapter
510, Statutes of 2008. Among other things, increased from
23 to 32, the limitation on the total number of
out-of-state thoroughbred races that may be imported per
day by a thoroughbred association or fair that is
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conducting a live race meet.
AB 1736 (Committee on Governmental Organization) Chapter
444, Statutes of 2007. Added the "Travers Stakes" to the
group of specific stake races which are exempt from the
23-race per day limit on imported races.
SB 379 (Denham) Chapter 443, Statutes of 2007. Added the
Dubai World Cup race to a specified list of races exempt
from the 23-race per day limit on imported races for
satellite wagering in California.
AB 509 (Jerome Horton) Chapter 235, Statutes of 2004.
Allowed a Thoroughbred or fair association to distribute
the audiovisual signal and accept wagers on the results of
out-of-country Thoroughbred races during the calendar
period the association or fair is conducting a race meeting
under specified conditions.
SB 590 (Perata) Chapter 936, Statutes of 2001. Authorized
Thoroughbred racing associations and fairs in the northern
racing zone to increase the number of imported racing
simulcasts available to be wagered upon if the CHRB reduces
the number of live racing days.
SUPPORT: As of June 24, 2011:
California Thoroughbred Racing Industry
OPPOSE: None on file as of June 24, 2011.
FISCAL COMMITTEE: No.
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