BILL ANALYSIS �
AB 2005
Page 1
GOVERNOR'S VETO
AB 2005 (Chesbro and Levine)
As Amended August 14, 2014
2/3 vote
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|ASSEMBLY: |69-5 |(May 19, 2014) |SENATE: |21-12|(August 19, |
| | | | | |2014) |
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|ASSEMBLY: |68-5 |(August 21, | | | |
| | |2014) | | | |
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Original Committee Reference: G.O.
SUMMARY : Expands the membership of the California Horse Racing
Board (CHRB), from seven to nine members, by adding two members
of the Legislature (one appointed by the Senate Rules Committee
and one appointed by the Speaker of the Assembly) as non-voting,
ex-officio members.
The Senate amendments :
1) Delete two of the four legislative members (one from each
House) that are to be appointed to the CHRB, thus the bill would
only increase the membership of the CHRB from seven to nine
members by adding two legislative members as non-voting,
ex-officio members.
2) Delete the requirement that the legislative members
appointed to the CHRB must be representative of a district that
is in a specific racing zone.
3) Provide that a legislative member has no authority to
designate a member of his or her staff or anyone else to serve
as his or her designee on the CHRB.
4) Provide that a legislative member who fails to attend three
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consecutive meetings of the CHRB shall be replaced by the
appointing authority.
EXISTING LAW :
1)Provides for the conduct of live horse racing in California
and for pari-mutuel wagering on these races at both on-track
and satellite wagering facilities and via Advance Deposit
Wagering. Horse racing in this state is subject to regulation
and oversight by the CHRB.
2)Specifies that CHRB board consist of seven members, appointed
by the Governor. Each member shall hold office for a term of
four years, commencing at the expiration of the previous term.
3)Provides that each member of the CHRB shall have been a
resident of the state for two years preceding his appointment.
4)Specifies that a person is disqualified from membership on the
board if the person, the person's spouse or any dependent
child thereof:
a)Holds a financial interest in any horse racing track.
b) Holds a financial interest or position of management
with any business entity which conducts pari-mutuel horse
racing.
c) Holds a financial interest in a management or concession
contract with any business entity which conducts
pari-mutuel horse racing.
5)Allows the appointment of horsemen and horsewomen who
represent the interests of owners and breeders to the CHRB by
a finding that it serves the public interest and owners and
breeders are members of the public for purposes of a finding
of financial interest, pursuant to the Government Code.
6)Provides the Governor may remove any board member for
incompetence, neglect of duty or corruption upon first giving
him a copy of the charges against him and an opportunity to be
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heard.
AS PASSED BY THE ASSEMBLY , this bill expanded the membership of
the CHRB from seven to 11 board members. The four new board
members would be appointed as non-voting, ex-officio members as
follows: two Members of the Senate appointed by the Senate
Rules Committee and two Members of the Assembly appointed by the
Speaker of the Assembly, as defined.
FISCAL EFFECT : According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, negligible state costs.
COMMENTS : This bill, as amended in the Senate is consistent
with Assembly actions.
Purpose of the bill: According to the author, this bill is
intended to provide more legislative participation and oversight
of the CHRB. Currently, there is limited involvement with the
CHRB by the Legislature. Board members appointed by the
Governor, make critical decisions relating to the economic
viability of cities and counties within the state by way of an
annual allocation of race dates. Changes in the horse racing
calendar can have a dramatic financial impact on communities
throughout California.
The author points out, "That currently, there are numerous
boards and commissions which have members of the Legislature as
members. There are currently 61 boards and 32 commissions that
have Members of the Legislature serving on them."
Background:
California Horse Racing Board: California's Horse Racing
Industry is heavily regulated. The "Horse Racing Law," found in
Business and Professions Code Chapter 4, directs regulatory
authority over horse racing to the CHRB. The CHRB currently
consists of seven members, each appointed by the Governor of
California. The CHRB members serve a broad constituency of
track owners, horse owners, breeders, trainers, jockeys, and the
betting public.
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Currently, six of the seven members of the CHRB have been
appointed or reappointed to serve on the board by Governor
Edmund G. Brown.
The CHRB is responsible for adopting rules and regulations for
the protection of the public and the control of horse racing and
pari-mutuel wagering; administration and enforcement of all
laws, rules, and regulations affecting horse racing and
pari-mutuel wagering; adjudication of controversies arising from
the enforcement of those laws and regulations dealing with horse
racing and pari-mutuel wagering; licensing of each racing
association and all persons, other than the public at large, who
participate in a horse racing meet with pari-mutuel wagering;
allocation of racing dates to qualified associations in
accordance with law; the board may delegate to stewards
appointed pursuant to any of its powers and duties that are
necessary to carry out fully and effectuate the purposes of
Horse Racing Law; and selecting an executive director to carry
out its policies.
What is an ex-officio member? An ex-officio member is a member
of a body (a board, committee, council, etc.) who is part of it
by virtue of holding another office.
Deteriorating status of the horse racing industry in California:
The California horse racing industry's long-term health is
threatened by a combination of factors, including competition
from racing in other states, other forms of gaming within
California, racetrack closures, and the potential for higher
return from development than operating revenues. As the value
of racing operations declines, track ownership is struggling to
maximize a significant return on the investment and tempted by
alternative uses of the property that yield higher returns.
Consequently, the racing industry is suffering unprecedented
instability and capital flight. Tens of thousands of industry
jobs might be in jeopardy, along with breeding farms and
precious open space in urban centers throughout California.
Also at risk is a substantial amount of local and state revenue
generated both directly and indirectly by the industry.
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GOVERNOR'S VETO MESSAGE :
"This bill adds one Senator and one Assembly Member to the
California Horse Racing Board as ex-officio, non-voting members
who are prohibited from serving on subcommittees of the Board.
"Members of the Legislature can already participate in the
decision-making process of the Board - through attendance at the
public hearings, formal correspondence to the Board, or the
meeting with Commissioners or staff. Changing the composition
of the Board as proposed would provide no additional benefits to
the Legislature or the horse racing industry."
Analysis Prepared by : Eric Johnson / G.O. / (916) 319-2531
FN: 0005618