REFERENCE TITLE: historic race wagering

 

 

 

 

State of Arizona

Senate

Fifty-fifth Legislature

First Regular Session

2021

 

 

 

SB 1794

 

Introduced by

Senator Gowan

 

 

AN ACT

 

amending sections 5-101, 5-104, 5-110, 5-111 and 5-112, arizona revised statutes; amending title 5, chapter 1, article 1, arizona revised statutes, by adding section 5-119; relating to racing.

 

 

(TEXT OF BILL BEGINS ON NEXT PAGE)

 


Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 5-101, Arizona Revised Statutes, is amended to read:

START_STATUTE5-101. Definitions

In this article, unless the context otherwise requires:

1. "Additional wagering facility" means a facility that is not the enclosure in which authorized racing takes place but that meets the requirements of section 5-111, subsection A and is used by a permittee for handling pari-mutuel wagering.

2. "Advance deposit wagering" means a form of pari-mutuel wagering that allows a person to deposit monies in advance in an account with an advance deposit provider and use the monies to pay for pari-mutuel wagering on live, or simulcast racing or previously run races that the advance deposit pari-mutuel wagering permittee accepts or makes.

3. "Advance deposit wagering provider" means a betting system or multijurisdictional wagering provider that is authorized to conduct advance deposit wagering pursuant to this article.

4. "Applicant" means a person, partnership, association or corporation placing before the department an application for a permit or license.

5. "Association" means a body of persons, corporations, partnerships or associations, united and acting together without a charter from the state for the prosecution of some common enterprise.

6. "Commercial horse racing" means horse racing conducted other than by a county fair association.

7. "Commission" means the Arizona racing commission.

8. "Concessionaire" means a person, partnership, association or corporation that offers goods or services for sale to the public, a permittee or a licensee at an enclosure in which authorized racing takes place or an additional wagering facility.

9. "County fair facility" means any place, enclosure or track constructed in accordance with a permit issued by the commission for the purpose of running county fair horse racing dates as well as any commercial dates for horse racing that may be awarded by the commission in reference to the location.

10. "County fair racing association" means an association duly authorized by the board of supervisors to conduct a county fair racing meeting for the benefit of the county.

11. "Dark day simulcast" means a simulcast received on a day when there are no posted races conducted at the enclosure in which authorized racing takes place.

12. "Department" means the department of gaming.

13. "Desensitized" means that a horse's legs on arrival at the receiving barn or saddling paddock do not respond appropriately to tests for feeling administered by an official veterinarian.

14. "Director" means the director of the department of gaming.

15. "Dog racing" means racing in which greyhound dogs chase a mechanical lure.

16. "Entered" means that a horse or dog has been registered with an authorized racing official as a participant in a specified race and has not been withdrawn prior to presentation of the horse or dog for inspection and testing as provided in section 5-105.

17. "Financial interest" means any direct pecuniary interest.

18. "Firm" means a business unit or enterprise that transacts business.

19. "free play" means the right to place a wager at no cost to the bettor.

20. "gross revenue" means the handle minus free play and payouts to bettors.

19. 21. "Handle" means the total amount of money contributed to all pari-mutuel pools by bettors.

20. 22. "Harness racing" means horse racing in which the horses are harnessed to a sulky, carriage or similar vehicle and driven by a driver.

23. "historic race wagering" means wagering on the outcome of previously run races that were run at a licensed racetrack enclosure, that concluded with official results and without scratches, disqualifications or dead-heat finishes and that may use nonrefundable amounts provided by a permittee as a seed or guarantee.

24. "historic racing terminal" means a cabinet or device on which historic race wagering is offered.

21. 25. "Horse racing" means racing in which horses are mounted and ridden by jockeys. For purposes of county fair racing meetings, "horse racing" means racing in which horses or mules are mounted and ridden by jockeys.

22. 26. "License" means the license issued by the department to each employee or other person participating in any capacity in a racing meeting, including officials and employees of the pari-mutuel department.

23. 27. "Pari-mutuel wagering" means a system of betting that provides for the distribution among the winning patrons of at least the total amount wagered less the amount withheld under state law.

24. 28. "Permit" means a permit for a racing meeting issued under the provisions of this article.

29. "permittee" means a firm, person, partnership, association or corporation that holds a permit.

30. "position" means either of the following:

(a) a slot machine.

(b) each seat at a gaming bar countertop, blackjack table, keno table, bingo table, poker table and other game table.

31. "Racetrack", "track" or "enclosure" means those premises used by a permittee for a racing meeting.

25. 32. "Racing meeting" means a number of days of racing allotted by the commission in one permit.

26. 33. "Simulcast" means the telecast shown within this state of live audio and visual signals of horse, harness or dog races conducted at an out-of-state track or the telecast shown outside this state of live audio and visual signals of horse or harness races originating within this state for the purpose of pari-mutuel wagering and in which wagers are pooled with all other similar wagers placed on the same event.

27. 34. "Source market fee" means the fee that an advance deposit wagering provider pays to a commercial permittee in the state where the advance deposit wagering customer resides.

28. 35. "Telephone" means any device that a person uses for voice communications in connection with the services of a telephone company.

36. "teletrack facility" means an additional wagering facility that is used for teletracking and handling pari-mutuel wagers and that is owned or leased by a permittee.

37. "teletracking" means:

(a) the telecast of live audio and visual signal of a live, simulcast or previously run race conducted at an authorized enclosure within this state by a racetrack permittee for the purpose of pari-mutuel wagering.

(b) The teletrack wagering conducted on the racing program at a teletrack FACILITY.

29. 38. "Undesirable" includes known bookmakers, touts, persons convicted of a violation of any provision of this article or of any law prohibiting bookmaking or any other illegal forms of wagering, or any other person whose presence would, in the opinion of the director, be inimical to the interests of the state.

30. 39. "Week" means seven consecutive days beginning on Monday and ending on Sunday, mountain standard time. END_STATUTE

Sec. 2. Section 5-104, Arizona Revised Statutes, is amended to read:

START_STATUTE5-104. Arizona racing commission; director; division; powers and duties

A. The commission shall:

1. Issue racing dates.

2. Prepare and adopt complete rules to govern the racing meetings that are required to protect and promote the safety and welfare of the animals participating in racing meetings, to protect and promote public health, safety and the proper conduct of racing and pari-mutuel wagering and any other matter pertaining to the proper conduct of racing within this state.

3. Conduct hearings on applications for permits, and approve permits and shall conduct rehearings on licensing and regulatory decisions made by the director as required pursuant to rules adopted by the commission.

4. Conduct all reviews of applications to construct capital improvements at racetracks as provided in this chapter.

B. The director shall license personnel and shall regulate and supervise all racing meetings held and pari-mutuel wagering conducted in this state and cause the various places where racing meetings are held and wagering is conducted to be visited and inspected on a regular basis. The director may delegate to stewards any of the director's powers and duties that are necessary to fully carry out and effectuate the purposes of this chapter. The director shall exercise immediate supervision over the division. The director is subject to ongoing supervision by the commission, and the commission may approve or reject decisions of the director in accordance with rules established by the commission.

C. The commission or the division is authorized to allow stewards, with the written approval of the director, to require a jockey, apprentice jockey, sulky driver, groom, horseshoer, outrider, trainer, assistant trainer, exercise rider, pony rider, starter, assistant starter, jockey's agent, veterinarian, assistant veterinarian, cool-out, security or maintenance worker, official or individual licensed in an occupational category whose role requires direct hands-on contact with horses, while on the grounds of a permittee, to submit to a test if the stewards have reason to believe the licensee is under the influence of or unlawfully in possession of any prohibited substance regulated by title 13, chapter 34.

D. The division shall employ the services of the office of administrative hearings to conduct hearings on matters requested to be heard by the director or the commission for the division except for those rehearings that are required by the terms of this chapter to be conducted by the commission.  Any person adversely affected by a decision of a steward or by any other decision of the division may request a hearing on the decision. The decision of the administrative law judge becomes the decision of the director unless rejected or modified by the director within thirty days. The commission may hear any appeal of a decision of the director in accordance with title 41, chapter 6, article 10.

E. The division may visit and investigate the offices, tracks or places of business of any permittee and place in those offices, tracks or places of business expert accountants and other persons as the division deems necessary for the purpose of ascertaining that the permittee or any licensee is in compliance with the rules adopted pursuant to this article.

F. The division shall establish and collect the following licensing fees and regulatory assessments, which shall not be reduced for capital improvements pursuant to section 5-111.02:

1. For each racing license issued, a license fee.

2. From the purse accounts provided for in section 5-111, a regulatory assessment to pay for racing animal medication testing, animal safety and welfare.

3. From each permittee, a regulatory assessment for each day of dark day simulcasting conducted in excess of the number of live racing days conducted by the permittee.

4. From each commercial racing permittee, a regulatory assessment payable from amounts deducted from pari-mutuel pools by the permittee, in addition to the amounts the permittee is authorized to deduct pursuant to section 5-111, subsection B from amounts wagered on live and simulcast races from in-state and out-of-state wagering handled by the permittee.

G. The commission shall establish financial assistance procedures for promoting adoption of retired racehorses. The provision of financial assistance to nonprofit enterprises for the purpose of promoting adoption of retired racehorses is contingent on a finding by the commission that the program presented by the enterprise is in the best interest of the racing industry and this state.  On a finding by the commission, the commission is authorized to make grants to nonprofit enterprises whose programs promote adoption of retired racehorses. The commission shall develop an application process. The commission shall require an enterprise to report to the commission on the use of grants under this subsection. Financial assistance for nonprofit enterprises that promote adoption of retired racehorses under this subsection shall not exceed the amount of retired racehorse adoption surcharges collected pursuant to this subsection. The commission shall collect a retired racehorse adoption surcharge in addition to each civil penalty assessed in connection with horse or harness racing pursuant to this article. The amount of the retired racehorse adoption surcharge shall be five percent of the amount collected for each applicable civil penalty.

H. A license is valid for the period established by the commission, but not more than five years, except for a temporary license issued pursuant to section 5-107.01, subsection F. The licensing period shall begin July 1.

I. A person may submit an application in writing that objects to any decision of track stewards within three days after the official notification of the decision. On application, the division or administrative law judge shall review the objection. In the case of a suspension of a license by the track stewards, the suspension shall run for a period of not more than six months. Before the end of this suspension period, filing an application for review is not cause for reinstatement.  If at the end of this suspension period the division or administrative law judge has not held a hearing to review the decision of the stewards, the suspended license shall be reinstated until the division or administrative law judge holds a hearing to review the objection. Except as provided in section 41-1092.08, subsection H, a final decision of the commission is subject to judicial review pursuant to title 12, chapter 7, article 6.

J. The commission or the director may issue subpoenas for the attendance of witnesses and the production of books, records and documents relevant and material to a particular matter before the commission or division and the subpoenas shall be served and enforced in accordance with title 41, chapter 6, article 10.

K. Any member of the commission, the administrative law judge or the director or the director's designee may administer oaths, and the oaths shall be administered to any person who appears before the commission to give testimony or information pertaining to matters before the commission.

L. The commission shall adopt rules that require permittees to retain for three months all official race photographs and videotapes. The division shall retain all photographs and videotapes that are used as evidence in an administrative proceeding until the conclusion of the proceeding and any subsequent judicial proceeding. All photographs and videotapes must be available to the public on request, including photographs and videotapes of races concerning which an objection is made, regardless of whether the objection is allowed or disallowed.

M. The director may establish a management review section for the development, implementation and operation of a system of management reports and controls in major areas of division operations, including licensing, workload management and staffing, and enforcement of this article and the rules of the commission.

N. In cooperation with the department of public safety, the director shall establish a cooperative fingerprint registration system.  Each applicant for a license or permit under this article or any other person who has a financial interest in the business or corporation making the application shall submit to fingerprint registration as part of the background investigation conducted pursuant to section 5-108. The cooperative fingerprint registration system shall be maintained in an updated form using information from available law enforcement sources and shall provide current information to the director on request as to the fitness of each racing permittee and each racing licensee to engage in the racing industry in this state.

O. The director shall develop and require division staff to use uniform procedural manuals in the issuance of any license or permit under this article and in the enforcement of this article and the rules adopted under this article.

P. The director shall submit an annual report containing operational and economic performance information as necessary to evaluate the department's budget request for the next fiscal year to the governor, the speaker of the house of representatives, the president of the senate and the secretary of state not later than September 30 each year. The annual report shall be for the preceding fiscal year and shall contain performance information as follows:

1. The total state revenues for the previous fiscal year from the overall pari-mutuel handle with an itemization for each horse racing meeting, each harness racing meeting, each advanced deposit wagering permittee and each additional wagering facility.

2. The total state revenues for the previous fiscal year from the regulation of racing, including licensing fees assessed pursuant to subsection F of this section and monetary penalties assessed pursuant to section 5-108.02.

3. The amount and use of capital improvement funds pursuant to section 5-111.02 that would otherwise be state revenues.

4. The number of licenses and permits issued, renewed, pending and revoked during the previous fiscal year.

5. The investigations conducted during the previous fiscal year and any action taken as a result of the investigations.

6. The division budget for the immediately preceding three fiscal years, including the number of full-time, part-time, temporary and contract employees, a statement of budget needs for the forthcoming fiscal year and a statement of the minimum staff necessary to accomplish these objectives.

7. Revenues generated for this state for the preceding fiscal year by persons holding racing meeting and advanced deposit wagering permits.

8. Recommendations for increasing state revenues from the regulation of the racing industry while maintaining the financial health of the industry and protecting the public interest.

Q. The commission may certify animals as Arizona bred or as Arizona stallions. The commission may delegate this authority to a breeders' association it contracts with for these purposes. The commission may authorize the association, racing organization or division to charge and collect a reasonable fee to cover the cost of breeding or ownership certification or transfer of ownership for racing purposes.

R. The commission may obtain the services of the office of administrative hearings on any matter that the commission is empowered to hear.

S. The division may adopt rules pursuant to title 41, chapter 6 to carry out the purposes of this article, ensure the safety and integrity of racing in this state and protect the public interest. END_STATUTE

Sec. 3. Section 5-110, Arizona Revised Statutes, is amended to read:

START_STATUTE5-110. Racing days, times and allocations; emergency transfer; county fairs; charity days

A. Permits for horse or harness racing meetings shall be approved and issued for substantially the same dates allotted to permittees for the same type of racing during the preceding year or for other dates that permittees request, provided that, in the event there is a conflict in dates requested between two or more permittees in the same county for the same kind of racing, the permittee whose application is for substantially the same dates as were allotted to the permittee in the preceding year shall be entitled to have preference over other permittees. In the event two or more permittees have agreed that the dates to be allotted to each of them each year shall be alternated from one year to the next, the commission shall recognize their agreement and those permittees may be accorded preference over any other permittee as to those dates to be allotted to those permittees on an alternating basis. Except as otherwise provided, the commission shall allot dates to the respective permittees after giving due consideration to all of the factors involved and the interests of permittees, the public and this state.

B. The commission may require by the terms of any permit that the permittee offer such number of races during any racing meeting as the commission shall determine, provided that the permittee shall be permitted allowed to offer at least the same number of races each day as offered in the prior year. The commission shall require each horse racing permittee to conduct for a period of thirty days a number of races equal to an average of at least two races for each day of racing exclusively for quarter horses. If, in the opinion of the commission, the permittee is offering acceptable quarter horse races but an honest effort is not being put forth to fill these races by the horsemen, the commission may rescind the two race per day quarter horse requirement.

C. Live racing and pari-mutuel wagering on live, simulcast and previously run races shall be permissible allowed in either daytime or nighttime. Unless otherwise agreed by written contract that is submitted to the department between all the permittees in the same county, there shall be no wagering on simulcast dog races before 4:15 p.m. A.M., mountain standard time, on the same day that there is live daytime horse or harness racing in any county in which commercial horse or harness racing has been conducted before February 1, 1971. The hours during which any other harness or horse racing is to be conducted shall be determined by the commission. The application for a permit shall state the exact days on which racing will be held and the time of day during which racing will be conducted.

D. If the commission determines that an emergency has obligated or may obligate a permittee to discontinue racing at a location, the commission may authorize the permittee to transfer racing for the number of days lost to any other location.

E. A racing meeting, when operated by a county fair racing association or under lease during the county fair to any individual, corporation or association, shall not come under the limitation placed on days of racing in this section.

F. The department shall be the judge of whether a county fair racing meeting is being operated pursuant to this section. A county fair racing meeting conducted by an individual, corporation or association, other than the properly authorized county fair racing association, shall come under the general provisions of this article the same as a commercial meeting. Notwithstanding this subsection, a county fair racing meeting, whether conducted by a county fair racing association or by an individual, corporation or association other than a county fair racing association, is exempt from the requirement prescribed in section 5-111 to pay to the state a percentage of the pari-mutuel pool collected at the meeting.

G. The commission may allow a permittee, in addition to the days specified in this permit, to operate up to three racing days during any one meeting as charity days. From the amount deducted from the total handled in the pari-mutuel pool on charity days, the permittee shall deduct an amount equal to the purses and the cost of conducting racing on these days, and shall donate the balance to nonprofit organizations and corporations that benefit the general public, that are engaged in charitable, benevolent and other like work and that are selected by the permittee and approved by the department. In no event shall the amount given to charity from charity racing days be less than the amount that otherwise would have gone to this state as the state's share on a noncharity racing day.

H. Notwithstanding any other law, live dog racing shall not be conducted in this state after December 31, 2016.  This subsection does not apply to nonprofit organizations that host lure coursing or similar events that test a dog's ability, stamina and breeding or training for such events. Notwithstanding any other provision of this article, any dog racing permittee that offered live dog racing in 2016 or that has offered live dog racing in eight out of ten calendar years from 1980 to 1990 in counties that have a population of less than five hundred thousand persons shall be considered as operating a racetrack enclosure for all purposes under this article and shall not be authorized or required to conduct live racing as a condition of that permittee's racing permit. Any permittee qualified under this subsection may conduct advance deposit wagering, wagering at additional wagering facilities that are owned or leased by that permittee and wagering on telecasts of races conducted at racetrack enclosures within this state or at racetrack enclosures outside this state without offering live racing at that permittee's racetrack enclosure. END_STATUTE

Sec. 4. Section 5-111, Arizona Revised Statutes, is amended to read:

START_STATUTE5-111. Wagering percentage to permittee and state; exemptions

A. The commission shall prescribe rules governing wagering on races under the system known as pari-mutuel wagering. Wagering shall be conducted by a permittee only by pari-mutuel wagering and only on the dates for which racing or dark day simulcasting has been authorized by the commission. Wagering for a licensed racing meeting shall be conducted by a commercial live-racing permittee only within an enclosure and, in counties having a population of less than five hundred thousand persons or at least one million five hundred thousand persons, at those additional facilities that are owned or leased by a permittee, that are approved by the commission and that are used by a permittee for handling wagering as part of the pari-mutuel system of the commercial live-racing permittee. In all other counties, wagering may also be conducted at additional facilities that are owned or leased by a commercial live-racing permittee who is licensed to conduct live racing in those counties or, until January 1, 2019, who has the consent of all commercial permittees currently licensed to conduct live racing in those counties, and that are used by a permittee for handling wagering and as part of the pari-mutuel system of the commercial live-racing permittee.  Beginning January 1, 2019, consent of commercial permittees licensed to conduct live racing in those counties is not required.  From and after December 31, 2016, Any agreement concerning simulcasting that is executed between a commercial dog racing permittee that conducted live dog racing in 2016 and a horse racing facility that is located in a county with a population of more than three million persons shall provide that twenty percent of the commission fee paid to a permittee that conducted live dog racing in 2016 under that agreement be distributed to the recognized horsemen's association that represents horsemen participating in race meets in this state. If the additional facilities have not been used for authorized racing before their use for handling wagering, a permittee shall not use the facilities for handling wagering before receiving approval for use by the governing body of the city or town, if located within the corporate limits, or by the board of supervisors, if located in an unincorporated area of the county. A permittee may televise any live or simulcast races received at the permittee's racing enclosure to the additional facilities at the times the races are conducted or received at the permittee's enclosure. For the purpose of section 5-110, subsection C only, a race on which wagering is permitted under this subsection shall be deemed to also occur at the additional facility in the county in which the additional facility is located, and shall be limited in the same manner as actual live racing in that county. For the purpose of subsection B of this section, the wagering at the additional facility shall be deemed to occur in the county in which the additional facility is located.

Ch. 246

Chs. 246
and 247

Ch. 246
Chs. 246
and 247


Ch. 246
B. During the period of a permit for horse or harness racing, the permittee that conducts the meeting may deduct up to and including twenty-five percent of the total amount handled in the regular pari-mutuel pools and, at the permittee's option, may deduct up to and including thirty percent of the total amount handled in the exacta, daily double, quinella and other wagering pools involving two horses, and up to and including thirty-five percent of the total amount handled in the trifecta or other wagering pools involving more than two horses in one or more races. The amounts if deducted shall be distributed as prescribed in subsection C of this section and section 5-111.02 for horse or harness racing permittees.

C. During the period of a permit for horse or harness racing, the this state shall receive two percent of the gross amount of the first one million dollars $1,000,000 of the daily pari-mutuel pools and five percent of the gross amount exceeding one million dollars $1,000,000 of the daily pari-mutuel pools. Notwithstanding any other provision of this subsection, the percentage paid by a permittee to the this state does not apply to monies handled in a pari-mutuel pool for wagering on simulcasts of out-of-state races. The permittee shall retain the balance of the total amounts deducted pursuant to subsection B of this section. Of the amount retained by the permittee, minus the amount payable to the permittee for capital improvements pursuant to section 5-111.02, breakage distributed to the permittee pursuant to section 5-111.01 and other applicable state, county and city transaction privilege or other taxes, unless otherwise agreed by written contract, fifty percent shall be used for purses. Unless otherwise agreed by written contract, fifty percent of the revenues received by the permittee from simulcasting races as provided in section 5-112, net of costs of advertising, shall be utilized as a supplement to the general purse structure. All amounts that are deducted from the pari-mutuel pool for purses pursuant to this section and sections 5-111.01, 5-112 and 5-114 and revenues that are received from simulcasting and that are to be used as a supplement to the general purse structure pursuant to this subsection shall be deposited daily into a trust account for the payment of purse amounts.

D. Any county fair racing association may apply to the commission for one racing meeting each year and the commission shall set the number of days and the dates of the meetings. A racing meeting conducted under this subsection shall be operated in such manner so that all profits accrue to the county fair racing association, and the county fair racing association may deduct from the pari-mutuel pool the same amount as prescribed in subsection B of this section. All county fair racing meetings, whether conducted by county fair racing associations under this subsection or by an individual, corporation or association other than a county fair racing association, are exempt from the payment to the state of the percentage of the pari-mutuel pool prescribed by subsection C of this section and are also exempt from the provisions of section 5-111.01.

E. Monies from charity racing days are exempt from the state percentage of the pari-mutuel pool prescribed in this section.

F. Sums held by a permittee for payment of unclaimed pari-mutuel tickets are exempt from the revised Arizona unclaimed property act, title 44, chapter 3.

G. All of the amounts received by a permittee from the gross amount of monies handled in a pari-mutuel pool and all amounts held by a permittee for payment of purses pursuant to this section and sections 5-111.01, 5-112 and 5-114 are exempt from the provisions of title 42, chapter 5. END_STATUTE

Sec. 5. Section 5-112, Arizona Revised Statutes, is amended to read:

START_STATUTE5-112. Wagering legalized; simulcasting of races; unauthorized wagering prohibited; classification; report; anticompetitive or deceptive practices prohibited

A. Except as provided in subsection J of this section, section 5-101.01, subsection F and title 13, chapter 33, any person within the enclosure of a racing meeting held pursuant to this article may wager on the results of a race held at the meeting or televised to the racetrack enclosure by simulcasting live, simulcast or previously run races and may wager on the results of simulcast dog races pursuant to this section by contributing money monies to a pari-mutuel pool or pools operated by the permittee as provided by this article.

B. The department, on request by a permittee, may grant permission for electronically televised simulcasts of horse, harness or dog races to be received by the permittee. In counties with a population of one million five hundred thousand persons or more, the simulcasts shall be received at the racetrack enclosure where a horse or harness racing meeting is being conducted, provided that the simulcast may only be received during, immediately before or immediately after a minimum of nine posted races for that racing day. In counties with a population of five hundred thousand persons or more but less than one million five hundred thousand persons, the simulcasts shall be received at the racetrack enclosure where a horse or harness racing meeting is being conducted provided that the simulcast may only be received during, immediately before or immediately after a minimum of four posted races for that racing day. In all other counties, the simulcasts shall be received at a racetrack enclosure at which authorized racing has been conducted, whether or not posted races have been offered for the day the simulcast is received.  The simulcasts are limited to horse, harness or dog races.  The simulcasts are limited to the same type of racing as authorized in the permit for live racing conducted by the permittee. The department, on request by a permittee, may grant permission for the permittee to transmit the live race from the racetrack enclosure where a horse or harness racing meeting is being conducted to a facility or facilities in another state.  All simulcasts of horse or harness races shall comply with the interstate horseracing act of 1978 (P.L. 95-515; 92 Stat. 1811; 15 United States Code chapter 57).  All forms of pari-mutuel wagering are allowed on horse, harness or dog races, whether or not televised by simulcasting.  All monies wagered by patrons on these horse, harness or dog races shall be computed in the amount of money wagered each racing day for the purposes of section 5-111.

C. Notwithstanding subsection B of this section, in counties with a population of one million five hundred thousand persons or more, simulcasts may be received at the racetrack enclosure, and the permittee may offer pari-mutuel wagering on the simulcast racing at any additional wagering facility used by a permittee for handling wagering as provided in section 5-111, subsection A during a permittee's racing meeting as approved by the commission, whether or not the simulcasts are televised to the additional wagering facilities and whether or not posted races have been conducted on the day the simulcast is received, if the permittee's racing permit requires the permittee to conduct a minimum of one hundred fifty-six days of live racing with an average of nine posted races on an average of five racing days each week at the permittee's racetrack enclosure during the period beginning on October 1 and ending on the first full week in May, unless otherwise agreed in writing by the permittee and the recognized horsemen's organization that represents has represented since 1988 the horsemen participating in the race meet at the racetrack enclosure, subject to approval by the department.

D. Notwithstanding subsection B of this section, in counties with a population of seven hundred thousand persons or more but less than one million five hundred thousand persons, simulcasts may be received at the racetrack enclosure, and the permittee may offer pari-mutuel wagering on the simulcast racing at any additional wagering facility used by a permittee for handling wagering as provided in section 5-111, subsection A during a permittee's racing meeting as approved by the commission, whether or not the simulcasts are televised to the additional wagering facilities and whether or not posted races have been conducted on the day the simulcast is received. The permittee may conduct wagering on dark day simulcasts for twenty days, provided the permittee conducts a minimum of seven posted races on each of the racing days mandated in the permittee's commercial racing permit. In order to conduct wagering on dark day simulcasts for more than twenty days, the permittee is required to conduct a minimum of seven posted races on one hundred forty racing days at the permittee's racetrack enclosure, unless otherwise agreed in writing by the permittee and the recognized horsemen's organization that represents the horsemen participating in the race meet at the racetrack enclosure, subject to approval by the department.

E. In an emergency and on a showing of good cause by a permittee, the commission may grant an exception to the minimum racing day requirements of subsections C and D of this section.

F. The minimum racing day requirements of subsections C and D of this section shall be computed by adding all racing days, including any county fair racing days operated in accordance with section 5-110, subsection F, allotted to the permittee's racetrack enclosure in one or more racing permits.

G. Simulcast signals or teletracking of simulcast signals does not prohibit live racing or teletracking of that live racing in any county at any time.

H. Except as provided in subsection J of this section, section 5-101.01, subsection F and title 13, chapter 33, any person within a racetrack enclosure or an additional facility authorized for wagering pursuant to section 5-111, subsection A may wager on the results of a race televised to the facility pursuant to section 5-111, subsection A by contributing to a pari-mutuel pool operated as provided by this article.

I. Except as provided in this article and in title 13, chapter 33, all forms of wagering or betting on the results of a race, including buying, selling, cashing, exchanging or acquiring a financial interest in pari-mutuel tickets, except by operation of law, whether the race is conducted in this state or elsewhere, are illegal.

J. A permittee shall not knowingly permit a person who is under twenty-one years of age to be a patron of the pari-mutuel system of wagering.

K. Except as provided in title 13, chapter 33, any person who violates this article with respect to any wagering or betting, whether the race is conducted in or outside this state, is guilty of a class 6 felony.

L. Simulcasting may only be authorized for the same type of racing authorized by a permittee's live racing permit.

M. In addition to pari-mutuel wagering otherwise authorized by this chapter, a commercial live-racing permittee or a commercial dog racing permittee that conducted live dog racing in 2016 may conduct advance deposit wagering as approved by the commission. The commission also may allow advance deposit wagering by an advance deposit wagering provider if a racing authority in the state where the advance deposit wagering provider is located approves the advance deposit wagering provider and, for horse racing, if the advance deposit wagering provider annually secures the approval of the commercial live horse racing permittees in a county where the advance deposit wagering provider or commercial live-racing permittee accepts advance deposit wagers for horse racing and of the organization that represents the majority of owners and trainers at each of the commercial live horse racing enclosures in each county. An advance deposit wagering provider that the commission approves shall pay source market fees on wagers placed on horse racing from this state to commercial live horse racing permittees in this state. The advance deposit wagering provider shall divide the source market fees on horse racing wagers on the basis of the proportion of the permittees' total live and simulcast handle during the previous year and the advance deposit wagering provider shall pay source market fees on wagers on dog racing from the county in which the live or simulcast racing is conducted to the commercial live racing permittee in that county. The advance deposit wagering provider shall divide the source market fees on dog racing from wagering in any other county as provided in a written agreement that is submitted to the department between all commercial dog racing permittees.

N. The commission may shall issue a permit to authorize an advance deposit wagering provider to accept advance deposit wagering on racing from persons in this state pursuant to the requirements of this subsection. The procedures for the approval of the permit must be similar to the procedures for the approval of racing permits under this article, subject to the following requirements:

1. The commission shall issue an advance deposit wagering permit only if the state agency that regulates racing in the state where the advance deposit wagering provider is located approves the permittee or provider to conduct advance deposit wagering.

2. An advance deposit wagering provider may accept advance deposit pari-mutuel wagers from natural persons in this state on racing conducted by a commercial live-racing permittee in this state or on racing conducted outside this state if the advance deposit wagering provider enters into an agreement with a commercial live-racing permittee in this state at for payment of a source market fee on all advance deposit wagering and the commercial live-racing permittee is either of the following:

(a) A permittee for a racetrack enclosure in a county where live horse or live dog racing has been conducted for a period of at least forty days per year for at least twelve consecutive years beginning after 1992. or  

(b) At a new racetrack enclosure in the same county that both:

(i) Replaced the previously existing racetrack enclosure. on which advance deposit wagering is accepted or that

(ii) Conducts a racing program with the same type of racing on which the advance deposit wagering is accepted enters into an agreement with the advance deposit wagering provider providing for the payment of a source market fee that is agreed to by the commercial live-racing permittee on all advance deposit wagering.

3. An advance deposit wagering provider shall pay source market fees in an amount that is agreed to by the a commercial live-racing permittee on all advance deposit wagering by persons in this state on the same type of racing the commercial live-racing permittee conducts. Source market fees from wagers by persons in this state through an advance deposit wagering provider shall be allocated as provided in paragraph 7 of this subsection to a commercial live horse racing permittee at a racetrack enclosure in a county where live horse racing has been conducted for a period of at least forty days per year for at least twelve consecutive years beginning after 1992 or at a new racetrack enclosure in the same county that replaced the previously existing racetrack enclosure during the period of time that the commercial live-racing permittee conducts a racing program. Source market fees for dog racing from wagering through the advance deposit wagering provider from persons wagering in a county shall be allocated as provided in paragraph 7 of this subsection to a commercial dog racing permittee at a racetrack enclosure in a county where live dog racing had been conducted in 2016 or had been conducted for a period of at least forty days per year for at least twelve consecutive years beginning after 1992 or at a new racetrack enclosure in the same county that replaced the previously existing racetrack enclosure. Source market fees from wagers by persons in this state in all other counties for pari-mutuel wagering on dog racing through an advance deposit wagering provider shall be allocated as provided in paragraph 7 of this subsection.

4. Advance deposit wagering agreements that are executed between permittees in this state must contain the same or substantially equivalent commercially reasonable terms and conditions, including provisions for revenue sharing, as the terms and conditions contained in simulcasting agreements that are executed between those same permittees in order to accept advance deposit wagering on horse racing from a county with a commercial dog racing permittee.

5. The advance deposit wagering provider shall transmit daily a percentage determined by the department of the gross revenues generated by advance deposit wagers to the department for deposit in the racing regulation fund established by section 5-113.01.

6. The advance deposit wagering provider shall file the consent provided for in this subsection with the commission, and the consent is valid for a period of at least one year.

7. The source market fees are allocated, after deductions, as provided for in section 5-111, subsection C for horse racing for any fees or payments to the state, county and city for taxes or other fees, in the same manner as the proceeds of simulcast pari-mutuel wagering as provided in section 5-111, subsection C for horse racing. From the source market fees from advance deposit wagering on horse racing allocated for purses as provided in section 5-111, subsection C, five percent is paid to the department for deposit in the Arizona breeders' award fund account for distributions for Arizona bred horses as provided in section 5-114.

8. any permittee that enters into an agreement with an advance deposit wagering provider must enter into an agreement that includes paying a percentage of wagers to the recognized horsemen's organization that has represented since 1988 the horsemen participating in racing MEETINGs. 

O. The owner of the advance deposit wagering account may make an advance deposit pari-mutuel wager only by telephone by any system or method, including in person or over the internet through websites and on mobile devices.

P. Only the advance deposit wagering provider may make an advance deposit wager, pursuant to wagering instructions the owner of the monies issues by telephone. The advance deposit wagering provider shall ensure the identification of the owner of the account by using methods and technologies approved by the commission. Any advance deposit wagering provider that accepts wagering instructions on races that are conducted in this state, or accepts wagering instructions originating in this state, shall provide a daily report that contains a full accounting and verification of the source of the wagers made, including the postal zip code of the source of the wagers and all pari-mutuel data, in a form and manner that is approved by the commission. All reasonable costs associated with the creation, provision and transfer of the data is the responsibility of the advance deposit wagering provider.

Q. Any person other than a permittee or any advance deposit wagering provider who is approved by the commission under this article and who accepts a wager or who bets on the results of a race, whether the race is conducted in or outside this state, including buying, selling, cashing, exchanging or acquiring a financial interest in a pari-mutuel ticket from a person in this state outside of a racing enclosure or an additional wagering facility that is approved by the commission and that is located in this state is guilty of a class 6 felony.

R. Pursuant to section 13-108, a pari-mutuel wager or a bet placed or made by a person in this state is deemed for all purposes to occur in this state.

S. The department and the attorney general shall enforce subsections Q and R of this section and shall submit an annual report that summarizes these enforcement activities to the governor, the speaker of the house of representatives and the president of the senate. The department and the attorney general shall provide a copy of this report to the secretary of state.

T. Each commercial live-racing permittee in this state shall enter into an agreement that complies with this subsection. Simulcasts that originate from a racetrack enclosure that conducts live racing in this state shall be offered to each commercial live-racing permittee in this state and additional wagering facility in this state. Each simulcast agreement executed pursuant to this subsection is subject to approval by the commission.  The commission shall approve the simulcast agreement if the commission determines that the agreement is reasonable and complies with the requirements of this subsection.  A permittee may not engage in any anticompetitive or deceptive practice in offering to send the permittee's simulcast to another commercial live-racing permittee or additional wagering facility in this state. For the purposes of this subsection, an anticompetitive or deceptive practice includes any of the following:

1. Any agreement to charge excessive or unreasonable fees for the right to receive the simulcasts. In determining whether a fee is excessive or unreasonable, the commission shall consider prevailing rates paid for comparable simulcast signals in the past, prevailing rates paid outside this state and whether any commonality of ownership or revenue sharing exists, partially or wholly, between the permittee in this state and the entity that receives the simulcast fee.

2. Any agreement, combination, trust or joint enterprise with any other racetrack or entity in which multiple simulcast signals are bundled together for the purpose of securing an excessive or unreasonable fee for one or more simulcast signals in the group in exchange for the right to receive any of the signals in that group.

3. Any other activity with the purpose or effect of artificially inflating prices beyond reasonable market rates.

U. Any simulcast of live racing into this state that originates from outside this state shall comply with this subsection.  The simulcast must be offered to each commercial live-racing permittee in this state and additional wagering facility in this state. Each simulcast agreement executed pursuant to this subsection is subject to approval by the commission.  The commission shall approve the simulcast agreement if the commission determines that the agreement is reasonable and complies with the requirements of this subsection.  A provider of simulcasts originating from outside of this state may not engage in any anticompetitive or deceptive practice in offering to contract for the privilege to send any interstate simulcast to a commercial live-racing permittee or additional wagering facility in this state.  For the purposes of this subsection, an anticompetitive or deceptive practice includes any of the following:

1. Any agreement to charge excessive or unreasonable fees for the right to receive the interstate simulcasts.  In determining whether a fee is excessive or unreasonable, the commission shall consider prevailing rates paid for comparable simulcast signals in the past, prevailing rates paid outside this state and whether any commonality of ownership or revenue sharing exists, partially or wholly, between the permittee in this state and the entity receiving the simulcast fee.

2. Any agreement, combination, trust or joint enterprise with any other racetrack or entity in which multiple interstate signals are bundled together for the purpose of securing an excessive or unreasonable fee for one or more simulcast signals in the group in exchange for the right to receive any of the signals in that group.

3. Any other activity with the purpose or effect of artificially inflating prices beyond reasonable market rates. END_STATUTE

Sec. 6. Title 5, chapter 1, article 1, Arizona Revised Statutes, is amended by adding section 5-119, to read:

START_STATUTE5-119. Historic race wagering; rules; terminals; revenue sharing

A. The department shall allow historic race wagering that is conducted on the grounds of a commercial live-racing permittee's racetrack that meets the requirements of subsection F or L of this section or at an additional wagering facility operated by a commercial live-racing permittee that operates a racetrack that meets the requirements of subsection F or L of this section.

B. The department shall adopt rules to allow historic race wagering to be conducted as regulated gambling on the grounds of a commercial live-racing permittee's racetrack and additional wagering facilities that meet the requirements of this section.

C. HISTORIC RACING TERMINALS MAY BE INSTALLED AT the following:

1. RACETRACKs THAT COMPLY WITH SUBSECTION F or L OF THIS SECTION AND THAT feature COMMERCIAL live HORSE RACING.

2. ADDITIONAL WAGERING FACILITIES operated IN THIS STATE by a racetrack that meets the requirements of subsection f or L of this section and AT WHICH SIMULCASTS ARE ALLOWED pursuant to SECTION 5-111, iF THE ADDITIONAL WAGERING FACILITIES ARE NOT WITHIN FIVE HUNDRED FEET OF A SCHOOL OR CHURCH.

D. THE TOTAL NUMBER OF HISTORIC RACING TERMINALS THAT MAY BE OPERATED WITHIN THIS STATE IS THE GREATER OF:

1. SEVEN THOUSAND FIVE HUNDRED.

2. FIFTEEN PERCENT OF THE AGGREGATE POSITIONS ALLOWED UNDER THE TRIBAL-STATE GAMING COMPACT.

E. A REDUCTION IN THE NUMBER OF POSITIONS ALLOWED UNDER THE TRIBAL-STATE GAMING COMPACT may NOT AFFECT THE NUMBER OF HISTORIC RACING TERMINALS THAT MAY BE OPERATED. 

F. THE TOTAL NUMBER OF HISTORIC RACING TERMINALS for use by commercial live-racing permittees at a racetrack and additional wagering facilities operated by a permittee SHALL BE initially ALLOCATED EVENLY AMONG RACETRACKs THAT MEET both OF THE FOLLOWING REQUIREMENTS:

1. Featured commercial live-racing pursuant to a live-racing permit as of January 1, 2019.

2. Conducted at least twenty-one live racing days between January 1, 2019 and December 31, 2019.

G. WITHIN SIX MONTHS AFTER THE EFFECTIVE DATE OF THIS SECTION or within six months after qualifying for an allocation of historic racing terminals pursuant to subsection F or L of this section, whichever is earliest, the permittee for EACH eligible RACETRACK MUST ENTER INTO A written AGREEMENT WITH THE RECOGNIZED HORSEMEN'S ORGANIZATION THAT has represented since 1988 THE HORSEMEN PARTICIPATING IN RACing Meetings AND with A NONPROFIT ORGANIZATION THAT represents a MAJORITY OF THE HORSE BREEDERS, TO PAY A PERCENTAGE OF EACH WAGER FROM HISTORIC RACING TERMINALS to the recognized horsemen's organization to be allocated for purses and to the nonprofit organization that represents a majority of the horse breeders. IF A permittee that operates an eligible racetrack DOES NOT ENTER INTO A written AGREEMENT PURSUANT TO This subsection, the historic racing terminals allocated to that racetrack WILL BE REALLOCATED EVENLY AMONG any eligible racetrack THAT HAs ENTERED INTO a written AGREEMENT and that meets the requirements of subsection f or L of this section.  EACH written AGREEMENT PURSUANT TO THIS SUBSECTION SHALL REQUIRE THE HORSEMEN'S PURSE trust ACCOUNT PURSUANT TO SECTION 5-111 TO BE CONTROLLED BY THE RECOGNIZED HORSEMEN'S ORGANIZATION THAT has represented since 1988 THE HORSEMEN PARTICIPATING IN RACing MEETings AND SHALL ALLOW FOR A PURSE MANAGEMENT FEE of two percent of the total amount paid to THE RECOGNIZED HORSEMEN'S ORGANIZATION for purses pursuant to this subsection. 

H. A MUNICIPALITY, COUNTY OR OTHER GOVERNMENTAL ENTITY OR POLITICAL SUBDIVISION, OTHER THAN THIS STATE, MAY NOT IMPOSE ANY TAX, FEE OR ASSESSMENT ON any of the following:

1. HISTORIC RACE WAGERING.

2. Owning OR OPERATING HISTORIC RACING TERMINALS.

3. THE GROSS REVENUES GENERATED BY HISTORIC RACE WAGERING OR OWNING OR OPERATING HISTORIC RACING TERMINALS.

I. The owner or LESSoR of a location used as AN ADDITIONAL WAGERING FACILITY THAT CONDUCTS HISTORIC RACE WAGERING MAY NOT CHARGE OR COLLECT MORE THAN ONE AND one-half PERCENT OF THE GROSS REVENUES GENERATED BY HISTORIC RACE WAGERING FOR RENT OR OTHER FEES FROM ANY COMMERCIAL LIVE-RACING PERMITTEE FOR OPERATING HISTORIC RACE WAGERING AT THE ADDITIONAL WAGERING FACILITY.

j. historic race wagering may be offered on any day whether or not posted races have been conducted on the same day that the historic race wagering is offered. 

k. each commercial live-racing permittee of a racetrack approved by the department to offer historic race wagering shall REQUEST, in an application submitted for a permit to offer live racing, the greater of the following:

1. Twenty-one racing days.

2. one hundred percent of the number of racing days and not less than one hundred percent of the number of races the racetrack requested for its 2019 live-racing permit, unless by agreement with the recognized horsemen's organization that has represented since 1988 the horsemen participating in racing meetings.

l. On january 1, 2025, notwithstanding subsection f of this section, any commercial live-racing permittee that has conducted at least twenty-one days of live-racing between January 1 and December 31 in each of the immediately preceding three consecutive calendar years shall be eligible for an allocation of historic racing terminals.  on qualification of a commercial live-racing permittee for historic racing terminals PURSUANT to this subsection, the DEPARTMENT SHALL reallocate to the permittee any historic racing terminals that were previously allocated to a racetrack pursuant to subsection F of this section, but that have not been made commercially available for wagering by patrons. END_STATUTE

Sec. 7. Exemption from rulemaking

Notwithstanding any other law, for the purposes of section 5-119, Arizona Revised Statutes, as added by this act, the department of gaming is exempt from the rulemaking requirements of title 41, chapter 6, Arizona Revised Statutes, for one year after the effective date of this act.

Sec. 8. Severability

If a provision of this act or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of this act that can be given effect without the invalid provision or application, and to this end the provisions of this act are severable.