Assigned to GOV AS
PASSED BY COMMITTEE
Assigned to GOV AS
PASSED BY COMMITTEE
ARIZONA STATE SENATE
Fifty-Third Legislature, Second Regular Session
AMENDED
Purpose
Allows the Division of Racing (Division) within the Arizona Department of Gaming (Department) to retain 20 percent of unencumbered monies in the Racing Regulation Fund (Regulation Fund), and caps the regulatory wagering assessment (RWA) for FY 2019 at 0.5 percent. Establishes the Rural County Fair Racing Fund (Racing Fund).
Background
The Department regulates tribal gaming activities, pari-mutuel racing and wagering, in addition to boxing and mixed martial arts. Laws 1995, Chapter 76 created the Department of which the Director is appointed by the Governor (A.R.S. § 5-604). Laws 2015, Chapter 19, placed the Arizona State Boxing and Mixed Martial Arts Commission (Boxing Commission) under the Department's Division of Racing. Laws 2016, Chapter 22, continued the Boxing Commission for two years, until July 1, 2018.
The Arizona Racing Commission (Racing Commission) consists of five members appointed by the Governor, who have been Arizona residents for at least five years before their appointment (A.R.S. § 5-103) The Racing Commission's duties include, in part: 1) issuing racing dates; 2) preparing and adopting rules for meetings to protect and promote the safety and welfare of animals participating in racing meets; 3) protecting and promoting the public health and safety during racing and pari-mutuel wagering; and 4) conducting hearings on applications for permits and reviewing all applications for capital improvements at racetracks (A.R.S. § 5-104).
The Regulation Fund is administered by the Department and monies in the Regulation Fund are subject to legislative appropriation (A.R.S. § 5-113.01). The Regulation Fund consists of the following: 1) license fees and regulatory assessments established by the Department and the Boxing Commission; 2) pari-mutuel taxes from wagering at horse and dog racing facilities; and 3) donations or grants received by the Department. According to JLBC, the expected year-end Regulation Fund balance is currently $1,886,000 (JLBC FY 2019 Baseline Book).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
Regulation, Funding and Licensing
2. Specifies that the Director is the Director of the Division, rather than the Department.
3. Allows the Division, at the end of each fiscal year after FY 2018, to retain up to 20 percent of the unencumbered monies in the Regulation Fund.
4. Requires the remaining unencumbered monies above the 20 percent threshold to be used for the purpose of lowering the RWA.
5. Caps the RWA for pari-mutuel pools in FY 2019 at 0.5 percent.
6. Increases, from three years to five years, the maximum time period for which a racing license is valid.
Rural County Fair Racing Fund
7. Establishes the Racing Fund to be administered by the Department.
8. Requires the Department to transfer $200,000 of surplus monies from the Regulation Fund to the Racing Fund in FY 2019.
9. Requires the Department to distribute matching grants on a first-come, first-served basis from the Racing Fund to counties of less than 800,000 persons that operate county fair racing.
10. Stipulates that a county is not eligible for a grant without contributing at least 50 percent of the amount of the grant to county fair racing.
11. Caps the maximum grant a county may receive in any one fiscal year at $40,000.
12. Requires the Commission to develop application procedures for counties to apply for a grant.
13. Repeals the Racing Fund on July 1, 2020.
14. Stipulates that any unencumbered monies in the Racing Fund after the repeal date revert back to the Regulation Fund.
Commission Duties and Membership
15. Removes the requirement that the Boxing Commission assist the Director of the Department with the development of rules, and subsequently conform to these rules, relating to administrative procedure and the assurance of integrity and safety in the racing industry.
16. Retains all current members of the Racing Commission until the expiration of their terms, after which the Governor is required to make all subsequent appointments.
17. Adds an additional member with substantial experience in the horse or harness racing industry to the Racing Commission.
18. Removes the member with substantial experience in the dog racing industry from the Racing Commission.
19. Removes the requirement that the Racing Commission adopt rules relating to the governance of dogs used in the dog racing industry.
Miscellaneous
20. Exempts the Department from rulemaking requirements for one year after the effective date of this legislation in order for the Department to develop a unique pari-mutuel wager known as Cactus Pick 6.
21. Requires the Department’s annual report to be submitted to the Secretary of State, rather than the Arizona State Library, Archives and Public Records.
22. Transfers and renumbers sections of statute relating to regulatory authority and reporting requirements on gross receipts taxes levied on boxing contests.
23. Repeals obsolete sections of statute.
24. Makes technical and conforming changes.
25. Becomes effective on the general effective date.
Amendments Adopted by Committee
· Makes technical corrections.
House Action Senate Action
COM 2/13/18 DPA 9-0-0-0 GOV 3/21/18 DPA 6-1-0
3rd Read 2/21/18 48-9-3
Prepared by Senate Research
March 22, 2018
JO/ZD/lat