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STATE OF NEW YORK
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S. 7744                                                 A. 10717

S E N A T E - A S S E M B L Y

June 16, 2012
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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.