Enacts the New York state racing franchise accountability and transparency act of 2012; creates a temporary reorganization board to serve for a period of three years.

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S7744-2011 Actions

• Sep 28, 2012: SIGNED CHAP.457
• Sep 27, 2012: DELIVERED TO GOVERNOR
• Jun 20, 2012: returned to senate
• Jun 20, 2012: passed assembly
• Jun 20, 2012: ordered to third reading rules cal.436
• Jun 20, 2012: substituted for a10717
• Jun 19, 2012: referred to racing and wagering
• Jun 19, 2012: DELIVERED TO ASSEMBLY
• Jun 19, 2012: PASSED SENATE
• Jun 19, 2012: ORDERED TO THIRD READING CAL.1349
• Jun 16, 2012: REFERRED TO RULES

S7744-2011 Meetings

Rules: Jun 21, 2012

S7744-2011 Calendars

Floor Calendar: Jun 19, 2012

S7744-2011 Votes

S7744-2011 Memo

BILL NUMBER:S7744

TITLE OF BILL:
An  act to amend the racing, pari-mutuel wagering and breeding law, in
relation  to  enacting   the   New   York   state   racing   franchise
accountability  and  transparency  act  of  2012;  to  amend part A of
chapter 60 of the  laws  of  2012  amending  the  racing,  pari-mutuel
wagering  and  breeding law and other laws relating to supervision and
regulation  of  the  state  gaming  industry,  in  relation   to   the
effectiveness thereof; and to repeal certain provisions of the racing,
pari-mutuel wagering and breeding law relating thereto

PURPOSE:
This  bill would modify the governance and accountability of the state
racing franchise.

SUMMARY OF PROVISIONS:
Section 1 of the bill provides a short title for sections one  through
six.

Section 2 contains legislative findings.

Section 3 would limit State acceptance of debt or liability.

Section  4 would create the New York Racing Association Reorganization
Board ("the Reorganization Board" or  "Board")  and  provide  for  its
structure  and  method  of  appointment.  The  section also identifies
methods  of  selecting  and  approving  the  Board's  chair,   filling
vacancies,  and  removing  and  replacing  Board members. Finally, the
section would terminate the Board three years from its establishment.

Section 5 would require that the structure of the Reorganization Board
be deemed to  be  incorporated  within  the  existing  certificate  of
incorporation   of  the  franchised  corporation,  require  conforming
changes to be made  to  the  governing  documents  of  the  franchised
corporation and limit amendment of same.

Section  6  would  require  certain  financial  disclosures  by  Board
members.

Section 7 would amend the date of establishment of the New York Gaming
Commission.

Section 8 provides for an effective date.

EXISTING LAW:
Racing, Pari-Mutuel  Wagering  and  Breeding  Law  �  207  provides  a
structure  for  the  New  York  Racing  Association board. The present
structure provides for fourteen private directors  and  eleven  public
directors.  Present  members  are  not  subject to any State financial
disclosure requirements.

JUSTIFICATION:
The structure of gaming and racing is undergoing change  in  New  York
with  the establishment of racinos, the creation of the New York State
Gaming Commission, and first passage of a constitutional amendment  on
commercial  casinos. Therefore, to ensure the viability and continuity


of racing, the racing industry and industries  that  support  and  are
sustained  by the racing industry, exigent circumstances necessitate a
temporary change of the  governing  structure  of  the  present  state
racing franchise holder to bring it under short-term public control.

The members of the Reorganization Board have been charged with working
in  the  best  interest  of  all  the stakeholders in horse racing and
managing  the   state   racing   franchise   with   transparency   and
accountability. The state racing franchise will be returned to private
control  in  the form of a not-for-profit corporation three years from
the effective date of the law.

The legislature  finds  these  statutory  changes  authorized  by  and
consistent  with  the  state  racing  franchise agreement appropriate,
necessary and in the best interests of racing.

LEGISLATIVE HISTORY:
This is a new bill.

BUDGET IMPLICATIONS:
This bill has no fiscal impact on the state.

EFFECTIVE DATE:
This bill would take effect immediately  except  that  sections  four,
five  and six of this bill would take effect upon the appointment of a
majority of the public directors of the Reorganization Board.

S7744-2011 Text

                      S T A T E   O F   N E W   Y O R K
  ________________________________________________________________________

      S. 7744                                                 A. 10717

                        SENATE - ASSEMBLY

                                June 16, 2012
                                 ___________

  IN  SENATE  -- Introduced by Sens. SKELOS, BONACIC -- (at request of the
    Governor) -- read twice and ordered printed, and when  printed  to  be
    committed to the Committee on Rules

  IN  ASSEMBLY -- Introduced by COMMITTEE ON RULES -- (at request of M. of
    A. Pretlow) -- (at request of the Governor) -- read once and  referred
    to the Committee on Racing and Wagering

  AN  ACT  to  amend the racing, pari-mutuel wagering and breeding law, in
    relation to enacting the New York state racing franchise  accountabil-
    ity and transparency act of 2012; to amend part A of chapter 60 of the
    laws  of  2012  amending the racing, pari-mutuel wagering and breeding
    law and other laws relating to supervision and regulation of the state
    gaming industry, in relation to  the  effectiveness  thereof;  and  to
    repeal  certain  provisions  of  the  racing, pari-mutuel wagering and
    breeding law relating thereto

    THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
  BLY, DO ENACT AS FOLLOWS:


    Section  1. Short title. Sections one through six of this act shall be
  known and may be cited as the "New York state racing franchise  account-
  ability and transparency act of 2012".
    S 2. Legislative findings. The legislature finds and declares a strong
  horse  racing  and breeding industry to be a valuable contributor to the
  New York state economy and a tourism generator for the entire state. The
  legislature further finds that The New York Racing Association, Inc. was
  authorized to incorporate by Chapter 18 of the Laws of 2008  to  further
  the  interests  of  thoroughbred  racing,  the  public  interest and the
  purposes of Article II of the Racing, Pari-Mutuel Wagering and  Breeding
  Law  and  to further the raising and breeding and improving the breed of
  horses.
    The structure of gaming and racing is undergoing change in  New  York,
  with  the  establishment  of racinos, the creation of the New York state
  gaming commission, and first passage of a  constitutional  amendment  on
  commercial  casinos. Therefore, the legislature finds in order to ensure
  the viability and continuity of horse racing, the  racing  industry  and

   EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                        [ ] is old law to be omitted.
                                                             LBD12141-11-2

 S. 7744                             2                           A. 10717

  industries  that  support  and  are  sustained  by  the racing industry,
  exigent circumstances necessitate a temporary structural change  in  the
  organization  of The New York Racing Association, Inc., in the form of a
  temporary  board.  This  temporary  reorganization  board shall be under
  public control to ensure The New York Racing Association, Inc.  works in
  the best interest of all stakeholders in horse  racing  including  fans,
  owners  and  breeders by managing the state racing franchise with trans-
  parency and accountability. In no later  than  three  years,  the  state
  racing  franchise shall be returned to private control, remaining in the
  form of a not-for-profit corporation.
    The legislature further finds  that  these  statutory  changes  to  be
  consistent  with  the  state  racing  franchise  agreement, appropriate,
  necessary and in the best interests of The New York Racing  Association,
  Inc.  and the racing industry in general.
    S  3.  The racing, pari-mutuel wagering and breeding law is amended by
  adding a new section 202-b to read as follows:

    S 202-B. NO DEBT OF THE STATE.   NOTHING  IN  THIS  ARTICLE  SHALL  BE
  CONSTRUED  TO ACCEPT A LIABILITY TO OR CREATE A DEBT OF THE STATE WITHIN
  THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY PROVISION.
    S 4. Paragraph a of subdivision 1 of section 207 of the racing,  pari-
  mutuel  wagering  and  breeding law is REPEALED and a new paragraph a is
  added to read as follows:

    A. THE BOARD OF DIRECTORS, TO BE CALLED THE NEW  YORK  RACING  ASSOCI-
  ATION  REORGANIZATION BOARD, SHALL CONSIST OF SEVENTEEN MEMBERS, FIVE OF
  WHOM SHALL BE ELECTED BY THE PRESENT CLASS A DIRECTORS OF THE  NEW  YORK
  RACING  ASSOCIATION, INC., EIGHT TO BE APPOINTED BY THE GOVERNOR, TWO TO
  BE APPOINTED BY THE TEMPORARY PRESIDENT OF THE  SENATE  AND  TWO  TO  BE
  APPOINTED BY THE SPEAKER OF THE ASSEMBLY.
    (I) THE GOVERNOR SHALL NOMINATE A MEMBER TO SERVE AS CHAIR, SUBJECT TO
  CONFIRMATION  BY  MAJORITY  VOTE  OF THE BOARD OF DIRECTORS.  ALL NON-EX
  OFFICIO MEMBERS SHALL HAVE EQUAL VOTING RIGHTS.
    (II) IN THE EVENT OF A MEMBER VACANCY OCCURRING BY DEATH,  RESIGNATION
  OR  OTHERWISE,  THE  RESPECTIVE  APPOINTING  OFFICER  OR  OFFICERS SHALL
  APPOINT A SUCCESSOR WHO SHALL HOLD OFFICE FOR THE UNEXPIRED  PORTION  OF
  THE TERM. A VACANCY FROM THE MEMBERS APPOINTED FROM THE PRESENT BOARD OF
  THE  NEW YORK RACING ASSOCIATION, INC., SHALL BE FILLED BY THE REMAINING
  SUCH MEMBERS.
    B.  IN ADDITION TO THESE VOTING MEMBERS, THE BOARD SHALL HAVE  TWO  EX
  OFFICIO  MEMBERS  TO  ADVISE  ON  CRITICAL  ECONOMIC  AND  EQUINE HEALTH
  CONCERNS OF THE RACING INDUSTRY, ONE APPOINTED BY THE NEW YORK THOROUGH-
  BRED BREEDERS INC., AND ONE  APPOINTED  BY  THE  NEW  YORK  THOROUGHBRED
  HORSEMEN'S  ASSOCIATION  (OR  SUCH  OTHER  ENTITY  AS  IS  CERTIFIED AND
  APPROVED PURSUANT TO SECTION TWO HUNDRED TWENTY-EIGHT OF THIS ARTICLE).
    C. ALL DIRECTORS SHALL SERVE  AT  THE  PLEASURE  OF  THEIR  APPOINTING
  AUTHORITY.
    D.  THE  BOARD,  WHICH  SHALL  BECOME  EFFECTIVE UPON APPOINTMENT OF A
  MAJORITY OF PUBLIC MEMBERS, SHALL TERMINATE THREE YEARS FROM ITS DATE OF
  CREATION. THE BOARD SHALL PROPOSE, NO LESS THAN ONE HUNDRED EIGHTY  DAYS
  PRIOR  TO ITS TERMINATION, RECOMMENDATIONS TO THE GOVERNOR AND THE STATE
  LEGISLATURE  REPRESENTING  A  STATUTORY   PLAN   FOR   THE   PROSPECTIVE
  NOT-FOR-PROFIT  GOVERNING  STRUCTURE OF THE NEW YORK RACING ASSOCIATION,
  INC.
    S 5. Subdivision 1 of section 207 of the racing, pari-mutuel  wagering
  and  breeding  law  is  amended  by  adding a new paragraph c to read as
  follows:


 S. 7744                             3                           A. 10717

    C. UPON THE EFFECTIVE DATE OF THIS PARAGRAPH,  THE  STRUCTURE  OF  THE
  BOARD  OF  THE FRANCHISED CORPORATION SHALL BE DEEMED TO BE INCORPORATED
  WITHIN AND MADE PART OF THE CERTIFICATE OF INCORPORATION  OF  THE  FRAN-
  CHISED  CORPORATION,  AND  NO  AMENDMENT TO SUCH CERTIFICATE OF INCORPO-
  RATION  SHALL BE NECESSARY TO GIVE EFFECT TO ANY SUCH PROVISION, AND ANY
  PROVISION CONTAINED WITHIN SUCH CERTIFICATE INCONSISTENT IN  ANY  MANNER
  SHALL  BE  SUPERSEDED  BY  THE  PROVISIONS OF THIS SECTION.   SUCH BOARD
  SHALL, HOWEVER, MAKE APPROPRIATE CONFORMING  CHANGES  TO  ALL  GOVERNING
  DOCUMENTS  OF  THE  FRANCHISED  CORPORATION INCLUDING BUT NOT LIMITED TO
  CORPORATE BY-LAWS.  FOLLOWING SUCH CONFORMING CHANGES, AMENDMENTS TO THE
  BY-LAWS OF THE FRANCHISED CORPORATION SHALL ONLY BE  MADE  BY  UNANIMOUS
  VOTE OF THE BOARD.
    S  6. Section 207 of the racing, pari-mutuel wagering and breeding law
  is amended by adding a new subdivision 5 to read as follows:

    5. EACH VOTING MEMBER OF THE BOARD  OF  DIRECTORS  OF  THE  FRANCHISED
  CORPORATION SHALL ANNUALLY MAKE A WRITTEN DISCLOSURE TO THE BOARD OF ANY
  INTEREST  HELD  BY THE DIRECTOR, SUCH DIRECTOR'S SPOUSE OR UNEMANCIPATED
  CHILD, IN ANY ENTITY UNDERTAKING BUSINESS  IN  THE  RACING  OR  BREEDING
  INDUSTRY.  SUCH  INTEREST DISCLOSURE SHALL BE PROMPTLY UPDATED, IN WRIT-
  ING, IN THE EVENT OF ANY MATERIAL CHANGE.
    THE BOARD SHALL ESTABLISH PARAMETERS FOR THE REPORTING AND  DISCLOSURE
  OF SUCH DIRECTOR INTERESTS.
    S  7.  Section 14 of part A of chapter 60 of the laws of 2012 amending
  the racing, pari-mutuel wagering and breeding  law  relating  to  super-
  vision  and  regulation  of  the state gaming industry; and amending the
  racing, pari-mutuel wagering and breeding  law,  the  general  municipal
  law,  the  executive  law  and  the tax law relating to the state gaming
  commission is amended to read as follows:

    S 14. This act shall take effect [October 1, 2012] FEBRUARY  1,  2013;
  provided,  however  that  effective immediately, the addition, amendment
  and/or repeal of any rules or regulations necessary for the  implementa-
  tion  of  the foregoing provisions of this act on its effective date are
  authorized and directed to be made  and  completed  on  or  before  such
  effective date.
    S  8.  This act shall take effect immediately; provided, however, that
  sections four, five and six of this  act  shall  take  effect  upon  the
  appointment  of a majority of public directors of the temporary reorgan-
  ization board of The New York Racing Association, Inc.  as set forth  in
  section  four  of  this  act,  provided that the chair of the racing and
  wagering board or his or her successor shall notify the legislative bill
  drafting commission upon the occurrence in order that the commission may
  maintain an accurate data base of the official text of the laws  of  the
  state  of New York in furtherance of effecting the provisions of section
  44 of the legislative law and section 70-b of the public officers law.