Bill S3564A-2011

Provides for payments to licensed harness tracks by regional off-track betting corporations

Provides for payments to licensed harness tracks by regional off-track betting corporations.

Details

Actions

  • Jan 19, 2012: PRINT NUMBER 3564A
  • Jan 19, 2012: AMEND AND RECOMMIT TO RACING, GAMING AND WAGERING
  • Jan 4, 2012: REFERRED TO RACING, GAMING AND WAGERING
  • Feb 25, 2011: REFERRED TO RACING, GAMING AND WAGERING

Memo

BILL NUMBER:S3564A

TITLE OF BILL: An act to amend the racing, pari-mutuel wagering and breeding law, in relation to payments by off-track betting corporations to regional licensed harness tracks

PURPOSE OR GENERAL IDEA OF BILL: This bill revises the hold harmless provisions that OTBs provide to harness tracks for the privilege of broadcasting additional nighttime thoroughbred events at OTB parlors. This is being done because most harness tracks now have video Lottery facilities which are earning harness tracks substantial profits. Additional money retained by OTBs by this measure is to be transferred to local governments to support their operations.

SUMMARY OF SPECIFIC PROVISIONS: Sections 1 and 2: Amend the Racing & Wagering Law section 1016 to reduce the "dark day" (the day when NYRA is not conducting a race meet) payment obligations applicable to off-track betting corporations (OTBs) from 1 1/2 percent of total daily pools on out-of-state thoroughbred races to 3/4 of 1 percent of such pools. In addition, it eliminates the requirement that a regional licensed harness track itself not display simulcasts of, or accept wagering upon, such out-of-state thoroughbred races in order to be eligible to receive, or share in the receipt of such payments from its regional OTB. The amended payment obligations would only apply during the first 120 days in each calendar year.

Section 3: Amends Racing & Wagering Law section 1017 to clarify that maintenance of effort payments by regional OTBs to the licensed harness tracks in their regions for calendar year 2009 are to be adjusted for any reduction in the number of racing programs conducted by any such track in that calendar year below the number of racing programs conducted by that track during the base year 2002. This section would also terminate such maintenance of effort obligations for calendar years subsequent to 2010. It also reduces the additional payment obligations of regional OTBs with respect to aggregate annual statewide handle on nighttime thoroughbred simulcast races during a phase-out period prior to full elimination thereof at the conclusion of the phase-out period.

JUSTIFICATION: Chapter 62 of the Laws of 2003 amended the Racing & wagering Law on the acceptance of wagering upon and the display of simulcasts of races run at out-of-state thoroughbred tracks. A maintenance of effort obligation was imposed on OTBs, measured by the level of commissions received by regional harness tracks in 2002 as derived from OTB wagering on out-of-state harness races conducted after 6 PM. The 2003 amendments also required OTBs to make supplemental payments to the harness industry to the extent that aggregate statewide handle on nighttime thoroughbred races exceeded $100 million.

Since the maintenance of effort and additional payment obligations were imposed 3 years ago, the net effect has been to reduce the revenue retained by OTBs which could have then been transferred to local governments. Despite the expanded wagering and simulcasting authorizations enacted in 2003, the incremental revenue increases from elimination of the nighttime thoroughbred simulcasting wagering restrictions have proven to be insufficient to replace the revenue transferred to the harness racing industry to hold them harmless for the OTB authorization to broadcast nighttime thoroughbred racing.

Since, nearly all harness tracks are operating video lottery games, this has helped to increase revenue for the harness tracks and purses.

However, requiring OTBs to continue the maintenance of effort and other payments are placing inequitable burdens on the regional OTB system. This bill would address the unintended inequities instituted in the 2003 law and enable OTBs to retain revenue which can be transferred to local governments.

LEGISLATIVE HISTORY: 2010: A.6916/S.2595 - Held in Racing, Gaming, and Wagering.

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: Immediate.


Text

STATE OF NEW YORK ________________________________________________________________________ 3564--A 2011-2012 Regular Sessions IN SENATE February 25, 2011 ___________
Introduced by Sen. ADAMS -- read twice and ordered printed, and when printed to be committed to the Committee on Racing, Gaming and Wager- ing -- recommitted to the Committee on Racing, Gaming and Wagering in accordance with Senate Rule 6, sec. 8 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said commit- tee AN ACT to amend the racing, pari-mutuel wagering and breeding law, in relation to payments by off-track betting corporations to regional licensed harness tracks THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Clause (E) of subparagraph 5 of paragraph b of subdivision 1 of section 1016 of the racing, pari-mutuel wagering and breeding law, as amended by chapter 18 of the laws of 2008, is amended to read as follows: (E) [On] DURING THE FIRST ONE HUNDRED TWENTY days IN ANY CALENDAR YEAR when a franchised corporation is not conducting a race meeting [and when a licensed harness track is neither accepting wagers nor displaying the signal from an in-state thoroughbred corporation or association or an out-of-state thoroughbred track]: (i) [Such] A licensed regional harness track shall receive in lieu of any other payments on wagers placed at off-track betting facilities outside the special betting district on races conducted by an in-state thoroughbred racing corporation, two and eight-tenths percent on regular and multiple bets during a regional meeting and one and nine-tenths percent of such bets if there is no regional meeting and four and eight- tenths percent on exotic bets on days on which there is a regional meet- ing and three and four-tenths percent of such bets if there is no regional meeting.
(ii) [Such] A licensed regional harness track shall receive [one and one-half] THREE-QUARTERS OF ONE per centum on total regional handle on races conducted at out-of-state or out-of-country thoroughbred tracks. (iii) In those regions in which there is more than one licensed regional harness track, [if no track is accepting wagers or displaying the live simulcast signal from the out-of-state track,] the total sum shall be divided among the tracks in proportion to the ratio the wagers placed on races conducted by each track bears to the corporation's total in-region harness handle. [If one or more tracks are accepting wagers or displaying the live simulcast signal, the total amount shall be divided among those tracks not accepting wagers or displaying the simulcast signal for an out-of-state track or in-state thoroughbred corporation or association.] S 2. Clause (F) of subparagraph 6 of paragraph b of subdivision 1 of section 1016 of the racing, pari-mutuel wagering and breeding law, as amended by chapter 18 of the laws of 2008, is amended to read as follows: (F) [On] DURING THE FIRST ONE HUNDRED TWENTY days IN ANY CALENDAR YEAR when a franchised corporation is not conducting a race meeting [and when a licensed harness track is neither accepting wagers nor displaying the signal from an in-state thoroughbred corporation or association or an out-of-state thoroughbred track]: (i) [Such] A licensed regional harness track shall receive in lieu of any other payments on wagers placed at off-track betting facilities outside the special betting district on races conducted by an in-state thoroughbred racing corporation, two and eight-tenths percent on regular and multiple bets during a regional meeting and one and nine-tenths percent of such bets if there is no regional meeting and four and eight- tenths percent on exotic bets on days on which there is a regional meet- ing and three and four-tenths percent of such bets if there is no regional meeting. (ii) [Such] A licensed regional harness track shall receive [one and one-half] THREE-QUARTERS OF ONE per centum on total regional handle on races conducted at out-of-state or out-of-country thoroughbred tracks. (iii) In those regions in which there is more than one licensed regional harness track, [if no track is accepting wagers or displaying the live simulcast signal from the out-of-state track,] the total sum shall be divided among the tracks in proportion to the ratio the wagers placed on races conducted by each track bears to the corporation's total in-region harness handle. [If one or more tracks are accepting wagers or displaying the live simulcast signal, the total amount shall be divided among those tracks not accepting wagers or displaying the simulcast signal for an out-of-state track or in-state thoroughbred corporation.] S 3. Subdivision 2 of section 1017 of the racing, pari-mutuel wagering and breeding law, as amended by chapter 18 of the laws of 2008, is amended to read as follows: 2. a. Maintenance of effort. Any off-track betting corporation which engages in accepting wagers on the simulcasts of thoroughbred races from out-of-state or out-of-country as permitted under subdivision one of this section shall submit to the board, for its approval, a schedule of payments to be made in any year or portion thereof, that such off-track corporation engages in nighttime thoroughbred simulcasting. In order to be approved by the board, the payment schedule shall be identical to the actual payments and distributions of such payments to tracks and purses made by such off-track corporation pursuant to the provisions of section one thousand fifteen of this article during the year two thousand two,
as derived from out-of-state harness races displayed after 6:00 P.M. If approved by the board, such scheduled payments shall be made from reven- ues derived from any simulcasting conducted pursuant to this section and section one thousand fifteen of this article. NOTWITHSTANDING ANY INCONSISTENT PROVISION OF THIS PARAGRAPH: (I) FOR PURPOSES OF CALCULAT- ING THE PAYMENTS TO BE MADE PURSUANT TO THIS PARAGRAPH FOR CALENDAR YEAR TWO THOUSAND TWELVE, THE AMOUNT OTHERWISE PAYABLE, IF ANY, BY AN OFF-TRACK BETTING CORPORATION TO A REGIONAL HARNESS TRACK SHALL BE REDUCED IN PROPORTION TO THE REDUCTION, IF ANY, IN THE NUMBER OF RACING PROGRAMS CONDUCTED BY THE REGIONAL HARNESS TRACK DURING TWO THOUSAND TWELVE COMPARED WITH THE NUMBER OF RACING PROGRAMS CONDUCTED BY SUCH TRACK DURING THE TWO THOUSAND FOUR BASE CALENDAR YEAR; AND (II) NO OFF- TRACK BETTING CORPORATION SHALL HAVE ANY FURTHER PAYMENT OBLIGATION PURSUANT TO THIS PARAGRAPH WITH RESPECT TO CALENDAR YEARS COMMENCING ON OR AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN. b. Additional payments. During each calendar year, to the extent, and at such time in the event, that aggregate statewide wagering handle after 7Labor P.M. on out-of-state and out-of-country thoroughbred races exceeds one hundred million dollars, each off-track betting corporation conducting such simulcasting shall pay to its regional harness track or tracks, an amount equal to [two percent] THE FOLLOWING PERCENTAGE of its proportionate share of such excess handle: FOR CALENDAR YEARS THROUGH TWO THOUSAND TWELVE, TWO PERCENT; FOR CALENDAR YEAR TWO THOUSAND THIR- TEEN, ONE AND ONE-HALF PERCENT; FOR CALENDAR YEAR TWO THOUSAND FOURTEEN, ONE PERCENT; AND FOR CALENDAR YEAR TWO THOUSAND FIFTEEN, ONE-HALF OF ONE PERCENT. THERE SHALL BE NO FURTHER ADDITIONAL PAYMENT OBLIGATION PURSU- ANT TO THIS PARAGRAPH FOR CALENDAR YEARS COMMENCING ON OR AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN. In any region where there are two or more regional harness tracks, such [two percent] PAYMENT AMOUNT shall be divided between or among the tracks in a proportion equal to the propor- tion of handle on live harness races conducted at such tracks during the preceding calendar year. Fifty percent of the sum received by each track pursuant to this paragraph shall be used exclusively for increasing purses, stakes and prizes at that regional harness track. S 4. This act shall take effect immediately.

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