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Business and Professions Code

DIVISION 8. SPECIAL BUSINESS REGULATIONS

Chapter 4. Horse Racing

Article 9.2. Satellite Wagering

Section 19605.71

19605.71. Amount and distribution of deductions from wagers at facilities in central and southern zone. The total percentage deducted from wagers at satellite wagering facilities in the central and southern zones shall be the same as the percentage deducted from wagers at the racetrack where the racing meeting is being conducted and shall be distributed as set forth in this section. Amounts deducted by a satellite wagering facility under this section shall be distributed as follows:

(a) (1) For thoroughbred meetings, 2 percent of the amount handled by the satellite wagering facility on conventional and exotic wagers shall be distributed to the racing association for payment to the state as a license fee, 2 percent shall be distributed to the satellite wagering facility as a commission for the right to do business, as a franchise, and this commission is not for the use of any real property, 0.54 percent shall be deposited with the official registering agency pursuant to subdivision (a) of Section 19617.2 and shall thereafter be distributed in accordance with subdivisions (b), (c), and (d) of Section 19617.2, 0.033 percent shall be distributed to the Center for Equine Health, and 0.067 percent shall be distributed to the California Animal Health and Food Safety Laboratory, School of Veterinary Medicine, University of California at Davis. It is the intent of the Legislature that the 0.033 percent of funds distributed to the Center for Equine Health shall supplement, and not supplant, other funding sources.

(2) (A) In addition to the distributions specified in paragraph (1), for thoroughbred meetings, an amount not to exceed 4 percent of the amount handled by the satellite wagering facility on conventional and exotic wagers shall be distributed to an organization described in Section 19608.2 with the mutual consent of the racing association, the organization representing the horsemen participating in the meeting, and the board from January 1, 2010, until December 31, 2013. However, the amount shall be no less than that specified in subparagraph (B), and any amount greater than the amount specified in subparagraph (B) shall be approved by the board for no more than 12 months at a time, and only upon a determination by the board that the greater amount is in the economic interest of thoroughbred racing.

(B) Commencing January 1, 2014, an amount not to exceed the amount of actual operating expenses, as determined by the board, or 2.5 percent of the amount handled by the satellite wagering facility on conventional and exotic wagers, whichever is less, shall be distributed to an organization described in Section 19608.2.

(C) A request to the board for a distribution pursuant to subparagraph (A) shall be accompanied by a report detailing all receipts and expenditures over the two prior fiscal years of the funds affected by the request.

(D) The racing association whose request pursuant to subparagraph (A) has been approved by the board shall provide subsequent quarterly reports of receipts and expenditures of the affected funds if requested by the board.

(b) For harness, quarter horse, Appaloosa, Arabian, or mixed breed meetings, 0.4 percent of the amount handled by the satellite wagering facility on conventional and exotic wagers shall be distributed to the racing association for payment to the state as a license fee, for fair meetings, 1 percent of the amount handled by the satellite wagering facility on conventional and exotic wagers shall be distributed to the racing association for payment to the state as a license fee, 2 percent shall be distributed to the satellite wagering facility as a commission for the right to do business, as a franchise, and this commission is not for the use of any real property, and 6 percent of the amount handled by the satellite wagering facility or the amount of actual operating expenses, as determined by the board, whichever is less, distributed to an organization described in Section 19608.2. In addition, in the case of quarter horses, 0.4 percent shall be deposited with the official registering agency pursuant to subdivision (b) of Section 19617.7 and shall thereafter be distributed in accordance with subdivisions (c), (d), and (e) of Section 19617.7; in the case of Appaloosas, 0.4 percent shall be deposited with the official registering agency pursuant to subdivision (b) of Section 19617.9 and shall thereafter be distributed in accordance with subdivisions (c), (d), and (e) of Section 19617.9; in the case of Arabians, 0.4 percent shall be held by the association to be deposited with the official registering agency, pursuant to Section 19617.8, and thereafter shall be distributed in accordance with Section 19617.8; in the case of standardbreds, 0.4 percent shall be distributed for the California Standardbred Sires Stakes Program pursuant to Section 19619; in the case of thoroughbreds, 0.48 percent shall be deposited with the official registering agency pursuant to subdivision (a) of Section 19617.2 and shall thereafter be distributed in accordance with subdivisions (b), (c), and (d) of Section 19617.2; 0.033 percent shall be distributed to the Center for Equine Health; and 0.067 percent shall be distributed to the California Animal Health and Food Safety Laboratory, School of Veterinary Medicine, University of California at Davis. It is the intent of the Legislature that the 0.033 percent of funds distributed to the Center for Equine Health shall supplement, and not supplant, other funding sources.

(c) In addition, for Appaloosa and mixed breed meetings, 1 percent shall be distributed to an organization described in Section 19608.2 for promotion of the program at satellite wagering facilities. Notwithstanding any other provision of law, on wagers made in the Counties of Orange and Los Angeles on thoroughbred races conducted in the County of Orange or Los Angeles, or both, excluding the 50th District Agricultural Association, the amount deducted for promotion of the satellite wagering program at satellite wagering facilities shall be 0.5 percent. Any of the promotion funds that are not distributed in the year in which they are collected may be distributed in the following year. If promotion funds distributed in any year exceed the amount collected for that year, the funds distributed in the following year shall be reduced by the excess amount. For harness meetings, 0.5 percent of the total amount handled by each satellite wagering facility shall be distributed to an organization described in Section 19608.2 for the promotion of the program at satellite wagering facilities, and 0.5 percent of the total amount handled by each satellite wagering facility shall be distributed according to a written agreement for each race meeting between the licensed racing association and the organization representing the horsemen participating in the meeting. For quarter horse meetings 0.5 percent of the total amount handled by satellite wagering facility on races run in California shall be distributed to an organization described in Section 19608.2 for the promotion of the program at satellite wagering facilities, 0.5 percent of the total amount handled by each satellite wagering facility on out-of-state and out-of-country imported races shall be distributed to the official quarter horse registering agency for the purposes of Section 19617.75, and 0.5 percent of the total amount handled by each satellite wagering facility on all races shall be distributed according to a written agreement for each race meeting between the licensed racing association and the organization representing the horseman participating in the meeting.

(d) Additionally, for thoroughbred, harness, quarter horse, mixed breed, and fair meetings, 0.33 percent of the total amount handled by the satellite wagering facility shall be paid to the city or county in which the satellite wagering facility is located pursuant to Section 19610.3 or 19610.4.

(e) Notwithstanding any other provision of law, a racing association is responsible for the payment of the state license fee as required by this section.

History.—Stats. 1993, Ch. 1084, in effect October 11, 1993, added "for the right . . . any real property" after "as a commission" in the first sentences of subdivisions (a) and (b); and deleted "; quarter horse," after "for harness," in the first sentence, added the fifth sentence, and substituted "July 27" for "the effective date of the amendments made to this section during the 1992 portion of the 1991–92 Regular Legislative Session" after "prior to" in the sixth sentence of subdivision (c). Stats. 1993, Ch. 1085, in effect January 1, 1994, added "thirty-three hundredths of" after "Section 19617.2; and" and added "and sixty-seven hundredths . . . Laboratory System" after "Research Laboratory" in the first sentence, and added "thirty-three hundredths of" after "Legislature that the" in the second sentence of subdivision (a); and added "thirty-three hundredths of" after "Section 19617.2; and" and added "and sixty-seven hundredths . . . Laboratory System" after "Research Laboratory" in the second sentence, and added "thirty-three hundredths of" after "Legislature that the" in the third sentence of subdivision (b). Stats. 1994, Ch. 1213, in effect September 30, 1994, substituted "deposited with the . . . of Section 19617.9" for "distributed as breeders' awards to breeders of Appaloosas" after "percent shall be" in the second sentence of subdivision (b). Stats. 1995, Ch. 826, in effect October 13, 1995, substituted "California Center for Equine Health and Performance" for "Equine Research Laboratory" after "to the" in the first and second sentences of subdivision (a); and substituted "held by the association to be deposited with the official registering agency, pursuant to Section 19617.8, and thereafter shall be distributed in accordance with Section 19617.8" for "distributed as breeders' awards to breeders of Arabians" after "percent shall be" in the second sentence, and substituted "California Center for Equine Health and Performance" for "Equine Research Laboratory" after "to the" in the second and third sentences of subdivision (b). Stats. 1996, Ch. 393, in effect January 1, 1997, substituted "subdivision (b), (c), and (d)" for "subdivision (b) and (c)" after "distributed in accordance with" in subdivision (a); and substituted "subdivisions (b), (c), and (d)" for "subdivisions (b) and (c)" before "of Section 19617.2;" in subdivision (b). Stats. 1998, Ch. 335 (SB 27), in effect January 1, 1999, substituted "2" for "2.5" after "meetings," deleted "wagers" after "conventional", deleted "4 percent on" before "exotic", substituted "shall be distributed to" for "retained by" after "2 percent", substituted "this" for "such" after "franchise, and" added "shall be" after "is less,", substituted "0.54 percent shall be" for "four-tenths of 1 percent" after "19608.2, and", added "and shall thereafter be distributed in accordance with subdivision (b), (c), and (d) of Section 19617.2," after "Section 19617.2", substituted "0.033 percent shall be" for thirty-three hundredths of one-tenth of 1 percent" before "distributed to the California", and substituted "0.067" for "sixty-seven hundredths of one-tenth of one-tenth of 1" in the first sentence of subdivision (a); substituted "0.4" for "1" after "mixed breed meetings," deleted "wagers" after "conventional", deleted "1 percent on" before "exotic", substituted "1" for "1.5" after "fair meetings," deleted "wagers" after the second "conventional", deleted "3 percent on" before the second "exotic", substituted "shall be distributed to" for "retained by" after "2 percent", substituted "this" for "such" after "franchise, and" in the first sentence, substituted "0.4" for "four-tenths of 1" three times, substituted "0.003" for "thirty-three hundredths of one-tenth of 1", substituted "0.067 percent shall be" for "sixty-seven hundredths of one-tenth of 1", and substituted "0.48" for "four-tenths of 1" after "thoroughbreds," in the second sentence, and substituted "0.003" for "thirty-three hundredths of one-tenth of 1" after "that the" in the third sentence of subdivision (b); substituted "Appaloosa and mixed breed" for "thoroughbred meetings and harness, Appaloosa, mixed breed, or fair" after "addition, for" in the first sentence, substituted "0.5" for "one half of 1" after "shall be" in the second sentence, added "and harness" after "quarter horse" and substituted "0.5" for "one half of 1" after "meetings," in the third sentence, and deleted the former fifth sentence of subdivision (c); created subdivision (d) with the former sixth sentence of subdivision (c) and substituted "for thoroughbred, harness, quarter horse, mixed breed, and fair meetings, 0.33" for "thirty-three hundredths of 1" after "Additionally," therein; and relettered former subdivision (d) as subdivision (e). Stats. 2000, Ch. 1082 (SB 2054), in effect January 1, 2001, substituted "Center for Equine Health" for "California Center for Equine Health and Performance" and substituted "Animal Health and Food Safety Laboratory" for "Veterinary Diagnostic Laboratory System" in subdivisions (a) and (b). Stats. 2001, Ch. 65 (AB 413), in effect July 16, 2001, substituted "deposited with the official registering agency pursuant to subdivision (b) of Section 19617.7 and shall thereafter be distributed in accordance with subdivisions (c), (d), and (e) of Section 19617.7;" for "distributed as breeders' awards to breeders of quarter horses pursuant to Section 19617.6;" after "percent shall be" in the second sentence of subdivision (b); deleted "quarter horse and" before "harness meetings" in the fifth sentence of subdivision (c) and added a sixth sentence therein. Amended by Stats. 2009, Ch. 650 (AB 1575), in effect January 1, 2010.

Note.—Section 12 of Stats. 1995, Ch. 826, provided that this act applies to any horseracing meeting conducted on or after January 1, 1995.

Note.—Section 3 of Stats. 1993, Ch. 1084, provided that the amendment of this section which states that the amount retained by the satellite wagering facility as a commission is for the right to do business as a franchise and that the commission is not for the use of any real property does not constitute a change in, but is declaratory of, the existing law.