Amended in Assembly March 28, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 2637

Introduced by Assembly Member Hall

February 21, 2014

An act to amend begin delete Section end delete begin insert Sections 19556 and end insert 19599 of begin insert , and to repeal Section 19549.3 of, end insert the Business and Professions Code, relating to horse racing.

LEGISLATIVE COUNSEL’S DIGEST

AB 2637, as amended, Hall. Horse racing: parimutuel begin delete wagering. end delete begin insert wagering and charity racing days. end insert

begin delete

Existing

end delete

begin insert (1) end insert begin insert   end insert begin insert Existing end insert law, the Horse Racing Law, provides 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 California Horse Racing Board as specified. That law authorizes an association or fair to offer any form of parimutuel wagering, as defined, and authorizes the board to prohibit any form of parimutuel wagering if it determines that the proposed wagering would compromise the honesty and integrity of racing in the state.

This bill would correct an outdated cross-reference begin insert and would delete the board’s authority to annually allocate a maximum of 28 racing days to any county fair in the northern zone which did not conduct horse racing prior to January 1, 1985 end insert .

begin insert

(2) The Horse Racing Law also requires each licensed racing association to designate a certain number of racing days to be conducted as charity days for the purpose of distribution of the net proceeds to beneficiaries. Existing law requires that beneficiaries of these proceeds be a nonprofit corporation or organization entitled by law to receive a distribution made by a distributing agent, exempt or entitled to exemption from state and federal income taxes, involved in specified beneficial activities, and approved by the California Horse Racing Board. Existing law requires, among other distributions, that at least 20% of the distribution from charity day racing go to charities associated with the horse racing industry.

end insert begin insert

This bill would increase the percentage of that distribution to 30%.

end insert

Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Section 19549.3 of the end insert begin insert Business and Professions
Code end insert begin insert is repealed. end insert

begin delete

19549.3.  

Notwithstanding Section 19549 or any other provision
of this chapter, the board may annually allocate a maximum of 28
racing days to any county fair in the northern zone which did not
conduct horseracing prior to January 1, 1985.

end delete

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 19556 of the end insert begin insert Business and Professions Code end insert
begin insert is amended to read: end insert

19556.  

(a) The distribution shall be made by the distributing
agent to beneficiaries qualified under this article. For begin delete the end delete purposes
of this article, a beneficiary shall be all of the following:

(1) A nonprofit corporation or organization entitled by law to
receive a distribution made by a distributing agent.

(2) Exempt or entitled to an exemption from taxes measured by
income imposed by this state and the United States.

(3) Engaged in charitable, benevolent, civic, religious,
educational, or veterans’ work similar to that of agencies
recognized by an organized community chest in the State of
California, except that the funds so distributed may be used by the
beneficiary for capital expenditures.

(4) Approved by the board.

(b) At least begin delete 20 end delete begin insert 30 end insert percent of the distribution shall be made to
charities associated with the horse racing industry. In addition to
this begin delete 20 end delete begin insert 30 end insert percent of the distribution, another 5 percent of the
distribution shall be paid to a welfare fund described in subdivision
(b) of Section 19641 and another 5 percent of the distribution shall
be paid to a nonprofit corporation, the primary purpose of which
is to assist horsemen and backstretch personnel who are being
affected adversely as a result of alcohol or substance abuse. No
beneficiary otherwise qualified under this section to receive charity
day net proceeds shall be excluded on the basis that the beneficiary
provides charitable benefits to persons connected with the care,
training, and running of racehorses, except that type of beneficiary
shall make an accounting to the board within one calendar year of
the date of receipt of any distribution.

(c) (1) In addition to the distribution pursuant to subdivision
(b), a separate 20 percent of the distribution shall be made to a
nonprofit corporation or trust, the directors or trustees of which
shall serve without compensation except for reimbursement for
reasonable expenses, and begin delete which end delete begin insert that end insert has as its sole purpose the
accumulation of endowment funds, the income on which shall be
distributed to qualified disabled jockeys.

(2) To receive a distribution under this subdivision, a begin insert nonprofit end insert
corporation or trust must establish objective qualifications for
disabled jockeys, and provide an annual accounting and report to
the board on its activities indicating compliance with the
requirements of this subdivision.

(3) The nonprofit corporation or trust shall, in an amount
proportional to the contributions received pursuant to this
subdivision as a percentage of the total contributions received by
the corporation or trust, give preference in assisting qualified
disabled jockeys to the following:

(A) Jockeys who were disabled while participating in the racing
or training of horses at licensed racing associations or approved
training facilities in California.

(B) Jockeys licensed by the board who were disabled while
participating in the racing or training of horses in a state other than
California.

(d) When the nonprofit corporation or trust described in
subdivision (c) has received distributions in an amount equal to
two million dollars ($2,000,000), the distribution mandated by
subdivision (c) shall cease.

begin delete SECTION 1. end delete
begin insert SEC. 3. end insert   

Section 19599 of the Business and Professions Code
is amended to read:

19599.  

An association or fair may offer any form of parimutuel
wagering, as defined by regulations adopted by the board, or as
defined by Chapter 4, Pari-Mutuel Wagering, Model Rules of
Racing, as published by the Association of Racing Commissioners
International. The board may prohibit any form of parimutuel
wagering if it determines that the proposed wagering would
compromise the honesty and integrity of racing in the state. Each
racing association or fair shall include the types of conventional
exotic and other wagering it proposes to offer on its application
to conduct a horse racing meeting.