S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8468
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             November 17, 2021
                                ___________
 
 Introduced  by  M.  of  A. L. ROSENTHAL -- read once and referred to the
   Committee on Ways and Means
 
 AN ACT to amend the tax law and the state finance law,  in  relation  to
   the  investment  of  funds wagered on video lottery gaming for certain
   horse races; and to repeal paragraph b of  subdivision  1  of  section
   1355  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. Subdivision f of section 1612 of the tax law, as amended by
 chapter  174 of the laws of 2013, paragraph 1 as amended by section 2 of
 part OO of chapter 59 of the laws of 2014 and paragraph 3 as amended  by
 section  2  of  part  V of chapter 59 of the laws of 2020, is amended to
 read as follows:
   f. As consideration for the operation  of  the  video  lottery  gaming
 facility  at Aqueduct racetrack, the division shall cause the investment
 in THE STATE OF NEW YORK  AND  the  racing  industry  of  the  following
 percentages of the vendor fee to be deposited or paid, as follows:
   1.  Six  and  one-half  percent  of  the total wagered after payout of
 prizes for the first year of operation of video lottery gaming at  Aque-
 duct  racetrack,  seven  percent  of  the  total wagered after payout of
 prizes for the second year of operation, and seven and one-half  percent
 of the total wagered after payout of prizes for the third year of opera-
 tion  and  thereafter,  for the purpose of [enhancing purses at Aqueduct
 racetrack, Belmont Park racetrack and Saratoga race course. One  percent
 of  the gross purse enhancement amount, as required by this subdivision,
 shall be paid to the gaming commission to be used exclusively to promote
 and ensure equine health and safety in New York.  Any  portion  of  such
 funding  to  the  gaming commission unused during a fiscal year shall be
 returned on a pro rata basis in accordance with the  amounts  originally
 contributed  and  shall  be  used for the purpose of enhancing purses at

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13560-01-1
              

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 such tracks] FUNDING THE STATE OF NEW YORK, SHALL BE DEPOSITED INTO  THE
 VIDEO LOTTERY GAMING REVENUE FUND, ESTABLISHED PURSUANT TO SECTION NINE-
 TY-NINE-OO  OF  THE  STATE  FINANCE LAW. One and one-half percent of the
 [gross  purse  enhancement]  amount REQUIRED TO BE DEPOSITED IN THE FUND
 ESTABLISHED PURSUANT TO SECTION NINETY-NINE-OO OF THE STATE FINANCE LAW,
 as required by this subdivision, shall be paid to an account established
 pursuant to section two hundred twenty-one-a of the racing,  pari-mutuel
 wagering  and  breeding  law  to  be  used exclusively to provide health
 insurance for jockeys.
   2. [One] EIGHT AND ONE-HALF percent of the total wagered after  payout
 of  prizes  [for  the first year of operation of video lottery gaming at
 Aqueduct racetrack, one and one-quarter percent  of  the  total  wagered
 after  payout  of  prizes  for the second year of operation, and one and
 one-half percent of the total wagered after payout  of  prizes  for  the
 third year of operation and thereafter, for an appropriate breeding fund
 for  the  manner of racing conducted at Aqueduct racetrack, Belmont Park
 racetrack and Saratoga race course]  TO  BE  DEPOSITED  INTO  THE  VIDEO
 LOTTERY  GAMING  REVENUE  FUND,  ESTABLISHED PURSUANT TO SECTION NINETY-
 NINE-OO OF THE STATE FINANCE LAW, FOR THE PURPOSE OF FUNDING  THE  STATE
 OF NEW YORK.
   3.  [Four  percent of the total revenue wagered after payout of prizes
 to be deposited into an account of  the  franchised  corporation  estab-
 lished  pursuant  to  section two hundred six of the racing, pari-mutuel
 wagering and breeding law to be used for capital expenditures  in  main-
 taining  and  upgrading  Aqueduct  racetrack, Belmont Park racetrack and
 Saratoga race course.  Capital  expenditures  may  include  funding  the
 construction  of and initially equipping a state-based equine drug test-
 ing and research laboratory to be used pursuant to subdivision seven  of
 section  nine hundred two of the racing, pari-mutuel wagering and breed-
 ing law.
   4. Three percent of the total revenue wagered after payout for  prizes
 to  be  deposited  into  an account of the franchised corporation estab-
 lished pursuant to section two hundred six of  the  racing,  pari-mutuel
 wagering  and  breeding  law  to be used for general thoroughbred racing
 operations at Aqueduct racetrack, Belmont Park  racetrack  and  Saratoga
 race course.
   5.]  Paragraphs  one[,]  AND two[, three and four] of this subdivision
 shall be known  collectively  as  the  "[racing]  VIDEO  LOTTERY  GAMING
 support payments".
   § 2. Paragraph 1-b of subdivision b of section 1612 of the tax law, as
 added  by  section  2  of  part EE of chapter 59 of the laws of 2019, is
 amended to read as follows:
   1-b. Notwithstanding any provision of law to the contrary,  free  play
 allowance  credits  authorized by the division pursuant to subdivision i
 of section sixteen hundred seventeen-a of  this  article  shall  not  be
 included in the calculation of the total amount wagered on video lottery
 games,  the total amount wagered after payout of prizes, the vendor fees
 payable to the operators of video lottery gaming facilities, fees  paya-
 ble  to  the division's video lottery gaming equipment contractors, [or]
 racing support payments, OR VIDEO LOTTERY GAMING SUPPORT PAYMENTS.
   § 3. Subdivision f-1 of section 1612 of the tax  law,  as  amended  by
 chapter 175 of the laws of 2013, is amended to read as follows:
   f-1.  As  consideration for operation of video lottery gaming facility
 located in the county of Nassau or Suffolk and operated by a corporation
 established pursuant to section five hundred two of the racing, pari-mu-
 tuel wagering and breeding law, the division shall cause the [investment
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 in the racing industry of the] following percentages of the  vendor  fee
 to be deposited or paid as follows:
   [1.  Two  and  three  tenths]  FIVE percent of the total wagered after
 payout of prizes [for the purpose of enhancing purses at Aqueduct  race-
 track, Belmont Park racetrack and Saratoga race course, provided, howev-
 er,  that  any amount that is in excess of the amount necessary to main-
 tain purse support from video  lottery  gaming  at  Aqueduct  racetrack,
 Belmont  Park racetrack and Saratoga race course at the same level real-
 ized in two thousand thirteen, to be  adjusted  by  the  consumer  price
 index  for  all  urban  consumers,  as  published annually by the United
 States department of labor, bureau of labor statistics, shall instead be
 returned to the commission] SHALL BE DEPOSITED INTO  THE  VIDEO  LOTTERY
 GAMING  REVENUE  FUND, ESTABLISHED PURSUANT TO SECTION NINETY-NINE-OO OF
 THE STATE FINANCE LAW FOR THE PURPOSE OF FUNDING THE STATE OF NEW YORK.
   [2. five tenths percent of the total wagered after  payout  of  prizes
 for  the  appropriate breeding fund for the manner of racing at Aqueduct
 racetrack, Belmont Park racetrack and Saratoga  race  course,  provided,
 however,  that  any  amount that is in excess of the amount necessary to
 maintain payments from video lottery gaming at Aqueduct racetrack at the
 same level realized in two thousand thirteen,  to  be  adjusted  by  the
 consumer  price  index for all urban consumers, as published annually by
 the United States department of labor, bureau of labor statistics, shall
 instead be returned to the commission.
   3. one and three tenths percent of the  total  revenue  wagered  after
 payout  of  prizes  to  be  deposited  into an account of the franchised
 corporation established pursuant to  section  two  hundred  six  of  the
 racing,  pari-mutuel  wagering  and  breeding law to be used for capital
 expenditures in maintaining and upgrading  Aqueduct  racetrack,  Belmont
 Park  racetrack  and  Saratoga  race course, provided, however, that any
 amount that is in excess of the amount necessary  to  maintain  payments
 for capital expenditures from video lottery gaming at Aqueduct racetrack
 at  the  same level realized in two thousand thirteen, to be adjusted by
 the consumer price index for all urban consumers, as published  annually
 by  the  United  States department of labor, bureau of labor statistics,
 shall instead be returned to the commission.
   4. Nine tenths percent of the total revenue wagered after  payout  for
 prizes  to  be  deposited  into an account of the franchised corporation
 established pursuant to section two hundred six of the racing,  pari-mu-
 tuel  wagering  and  breeding  law  to  be used for general thoroughbred
 racing operations at Aqueduct  racetrack,  Belmont  Park  racetrack  and
 Saratoga  race  course,  provided,  however,  that any amount that is in
 excess  of  the  amount  necessary  to  maintain  payments  for  general
 thoroughbred  racing  operations  from  video lottery gaming at Aqueduct
 racetrack at the same level realized in two  thousand  thirteen,  to  be
 adjusted  by  the  consumer  price  index  for  all  urban consumers, as
 published annually by the United States department of labor,  bureau  of
 labor statistics, shall instead be returned to the commission.]
   §  4. The opening paragraph of paragraph 2 of subdivision b of section
 1612 of the tax law, as amended by section 2 of part S of chapter 39  of
 the laws of 2019, is amended to read as follows:
   As consideration for the operation of a video lottery gaming facility,
 the  division, shall cause the investment in the racing industry AND THE
 STATE OF NEW YORK of a portion of the vendor fee  received  pursuant  to
 paragraph one of this subdivision in the manner set forth in this subdi-
 vision.    With  the  exception  of  Aqueduct racetrack, a video lottery
 gaming facility authorized pursuant to paragraph five of  subdivision  a
 A. 8468                             4
 
 of  section sixteen hundred seventeen-a of this article or a facility in
 the county of Nassau or Suffolk operated by  a  corporation  established
 pursuant to section five hundred two of the racing, pari-mutuel wagering
 and breeding law, each such track shall dedicate a portion of its vendor
 fees, received pursuant to clause (A), (B), (B-1), (B-2), (C), or (D) of
 subparagraph  (ii) of paragraph one of this subdivision, for the purpose
 of [enhancing purses at such track] FUNDING THE STATE OF NEW YORK, in an
 amount equal to eight and three-quarters percent of  the  total  revenue
 wagered  at  the  vendor track after pay out for prizes. [One percent of
 the gross purse enhancement amount, as  required  by  this  subdivision,
 shall be paid to the gaming commission to be used exclusively to promote
 and  ensure  equine  health  and safety in New York. Any portion of such
 funding to the gaming commission unused during a fiscal  year  shall  be
 returned  to  the  video lottery gaming operators on a pro rata basis in
 accordance with the amounts originally contributed by each operator  and
 shall  be  used  for the purpose of enhancing purses at such track] SUCH
 FUNDS SHALL BE DEPOSITED INTO THE VIDEO  LOTTERY  GAMING  REVENUE  FUND,
 ESTABLISHED PURSUANT TO SECTION NINETY-NINE-OO OF THE STATE FINANCE LAW.
 One  and  one-half  percent  of the [gross purse enhancement amount at a
 thoroughbred track] AMOUNT PAID TO  THE  VIDEO  LOTTERY  GAMING  REVENUE
 FUND,  as  required  by  this  subdivision,  shall be paid to an account
 established pursuant to section two hundred twenty-one-a of the  racing,
 pari-mutuel  wagering and breeding law to be used exclusively to provide
 health insurance for jockeys. In addition, with the exception  of  Aque-
 duct  racetrack,  a video lottery gaming facility authorized pursuant to
 paragraph five of subdivision a of section sixteen  hundred  seventeen-a
 of  this  article or a facility in the county of Nassau or Suffolk oper-
 ated by a corporation established pursuant to section five  hundred  two
 of  the racing, pari-mutuel wagering and breeding law, one and one-quar-
 ter percent of total revenue wagered at the vendor track after  pay  out
 for  prizes, received pursuant to clause (A), (B), (B-1), (B-2), (C), or
 (D) of subparagraph (ii) of paragraph one of this subdivision, shall  be
 distributed  to  the [appropriate breeding] VIDEO LOTTERY GAMING REVENUE
 fund [for the manner of racing conducted  by  such  track],  ESTABLISHED
 PURSUANT TO SECTION NINETY-NINE-OO OF THE STATE FINANCE LAW.
   §  5.  Subdivision  h  of  section  1612 of the tax law, as amended by
 section 3 of part S of chapter 39 of the laws of  2019,  is  amended  to
 read as follows:
   h. As consideration for the operation of a video lottery gaming facil-
 ity located in Orange county, the division shall cause the investment in
 the [racing industry] STATE OF NEW YORK at the following amount from the
 vendor fee to be paid as follows:
   [As  amount  to  the  horsemen  for  purses at a licensed racetrack in
 Sullivan county in an] AN  amount  equal  to  eight  and  three-quarters
 percent of the total revenue wagered at the video lottery gaming facili-
 ty,  after  pay  out  for  prizes TO BE PAID TO THE VIDEO LOTTERY GAMING
 REVENUE FUND, ESTABLISHED PURSUANT  TO  SECTION  NINETY-NINE-OO  OF  THE
 STATE FINANCE LAW. [The facility located in Orange county, as defined in
 paragraph  five  of subdivision a of section sixteen hundred seventeen-a
 of this article shall pay to the horsemen at  a  licensed  racetrack  at
 Yonkers  racetrack an amount to maintain purses for such horsemen at the
 same dollar levels realized in two thousand eighteen, to be adjusted  by
 the  consumer price index for all urban consumers, as published annually
 by the United States department of labor bureau of labor statistics.] In
 addition, one and one-quarter percent of total revenue  wagered  at  the
 video  lottery gaming facility after pay out for prizes, received pursu-
 A. 8468                             5
 
 ant to clause (B) of subparagraph (ii) of paragraph one of subdivision b
 of this section, shall be  distributed  to  the  [appropriate  breeding]
 VIDEO LOTTERY GAMING REVENUE fund [for the manner of racing conducted by
 such track], ESTABLISHED PURSUANT TO SECTION NINETY-NINE-OO OF THE STATE
 FINANCE  LAW.  In  no  circumstance  shall  net proceeds of the lottery,
 including the proceeds from  video  lottery  gaming,  be  used  for  the
 payment of non-lottery expenses of the gaming commission, administrative
 or otherwise.
   § 6. The state finance law is amended by adding two new sections 99-oo
 and 99-pp to read as follows:
   §  99-OO. VIDEO LOTTERY GAMING REVENUE FUND. 1. THERE IS HEREBY ESTAB-
 LISHED IN THE JOINT CUSTODY OF THE STATE COMPTROLLER AND THE COMMISSION-
 ER OF TAXATION AND FINANCE A SPECIAL FUND TO  BE  KNOWN  AS  THE  "VIDEO
 LOTTERY GAMING REVENUE FUND".
   2.  SUCH  FUND  SHALL CONSIST OF ALL REVENUES RECEIVED PURSUANT TO THE
 PROVISIONS OF SECTION ONE THOUSAND SIX HUNDRED TWELVE OF THE TAX LAW AND
 ALL OTHER MONEYS CREDITED OR TRANSFERRED THERETO FROM ANY OTHER FUND  OR
 SOURCE  PURSUANT TO LAW. NOTHING CONTAINED IN THIS SECTION SHALL PREVENT
 THE STATE FROM RECEIVING GRANTS, GIFTS OR BEQUESTS FOR THE  PURPOSES  OF
 THE  FUND  AS  DEFINED IN THIS SECTION AND DEPOSITING THEM INTO THE FUND
 ACCORDING TO LAW.
   3. THE MONEYS IN SUCH FUND SHALL BE DISBURSED  TO  THE  STATE  LOTTERY
 FUND,  THE  GENERAL  FUND, AND AN ADDITIONAL SUB-FUND CREATED WITHIN THE
 VIDEO LOTTERY GAMING REVENUE FUND KNOWN  AS  THE  VIDEO  LOTTERY  GAMING
 REVENUE COMMUNITY REINVESTMENT FUND, AS FOLLOWS:
   (A)  FORTY  PERCENT  SHALL  BE DEPOSITED IN THE STATE LOTTERY FUND FOR
 ADDITIONAL  LOTTERY  GRANTS  TO  ELIGIBLE  SCHOOL  DISTRICTS,  INCLUDING
 SCHOOLS  SERVING  STUDENTS WITH DISABILITIES AND  SCHOOLS WITH PRESCHOOL
 SPECIAL EDUCATION PROGRAMS;
   (B) TWENTY-FIVE PERCENT SHALL BE DEPOSITED IN THE STATE  LOTTERY  FUND
 TO BE ALLOCATED TO THE HUMAN SERVICES SECTOR;
   (C)  FIVE  PERCENT  SHALL BE DEPOSITED IN THE STATE LOTTERY FUND TO BE
 ALLOCATED TO THE DEPARTMENT OF LABOR WORKER PROTECTION FUND; AND
   (D) THIRTY PERCENT SHALL BE DEPOSITED  IN  THE  VIDEO  LOTTERY  GAMING
 REVENUE  COMMUNITY REINVESTMENT FUND ESTABLISHED BY SECTION NINETY-NINE-
 PP OF THIS ARTICLE.
   § 99-PP. VIDEO LOTTERY GAMING REVENUE COMMUNITY REINVESTMENT FUND.  1.
 THERE  IS  HEREBY  ESTABLISHED  IN  THE JOINT CUSTODY OF THE STATE COMP-
 TROLLER AND COMMISSIONER OF TAXATION AND FINANCE A SPECIAL  FUND  TO  BE
 KNOWN AS THE "VIDEO LOTTERY GAMING REVENUE FUND".
   2.  SUCH  FUND  SHALL  CONSIST  OF  REVENUES  RECEIVED PURSUANT TO THE
 PROVISIONS OF SECTION NINETY-NINE-OO  OF  THIS  ARTICLE  AND  ALL  OTHER
 MONEYS  CREDITED  OR  TRANSFERRED  THERETO FROM ANY OTHER FUND OR SOURCE
 PURSUANT TO LAW. NOTHING CONTAINED IN THIS  SECTION  SHALL  PREVENT  THE
 STATE  FROM  RECEIVING GRANTS, GIFTS OR BEQUESTS FOR THE PURPOSES OF THE
 FUND AS DEFINED IN THIS  SECTION  AND  DEPOSITING  THEM  INTO  THE  FUND
 ACCORDING TO LAW.
   3.  THE  MONEYS RECEIVED BY SUCH FUND SHALL BE EXPENDED TO THE COMMIS-
 SIONER OF AGRICULTURE AND DISBURSED, IN CONSULTATION WITH THE  PRESIDENT
 AND  CHIEF EXECUTIVE OFFICER OF THE EMPIRE STATE DEVELOPMENT CORPORATION
 TO BE SPENT ON AGRICULTURAL GRANTS,  FUNDING  FOR  HORSE  CARE  AND  THE
 ADOPTION  OF  RACE HORSES, AND ECONOMIC DEVELOPMENT IN COMMUNITIES WHERE
 HORSE RACING OCCURS.
   4. MONEYS SHALL BE PAYABLE FROM THE FUND ON THE AUDIT AND  WARRANT  OF
 THE  COMPTROLLER  ON VOUCHERS APPROVED AND CERTIFIED BY THE COMMISSIONER
 OF AGRICULTURE.
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   § 7. Paragraph 5 of subdivision a of section 1617-a of the tax law, as
 added by section 4 of part S of chapter 39  of  the  laws  of  2019,  is
 amended to read as follows:
   (5) At a facility located in Orange county to be operated by the enti-
 ty  otherwise  licensed  to  operate  video lottery gaming at Monticello
 racetrack, provided that: (i) such licensed entity is no longer  operat-
 ing  video  lottery  gaming  at  Monticello racetrack [and provided that
 Monticello racetrack is conducting racing operations]; (ii) such facili-
 ty in Orange county is not sited within a  thirty  mile  radius  of  the
 video  lottery  gaming  facility  at  Yonkers  racetrack;  and (iii) the
 licensed entity, its subsidiaries and affiliates, including  the  entity
 licensed to operate a commercial gaming facility in Sullivan county, and
 the entity licensed to operate video lottery gaming at Yonkers racetrack
 enter  into a mitigation agreement, to be approved by the gaming commis-
 sion, which shall include, but not be limited to,  terms  that  require:
 (A)  the  operator  of  the  facility in Orange county to make an annual
 payment to the entity  licensed  to  operate  video  lottery  gaming  or
 commercial  gaming  at Yonkers racetrack to account for the effects that
 siting such facility in Orange county would likely  have  on  the  gross
 gaming  revenue  of the entity licensed to operate at Yonkers racetrack;
 (B) employment levels at the affected  facilities;  and  (C)  that  upon
 expiration  or  termination  of  the agreement, the authority to operate
 video lottery gaming in Orange county shall cease.  Notwithstanding  any
 other  provision of this subdivision, at no time shall an entity operat-
 ing video lottery gaming in Orange county be permitted to apply  for  or
 receive  a license to operate a commercial gaming facility in that coun-
 ty.
   § 8. Paragraph (b) of subdivision 1 of section  1355  of  the  racing,
 pari-mutuel wagering and breeding law is REPEALED.
   §  9.  Severability.  If any clause, sentence, paragraph, subdivision,
 section or part of this act shall be adjudged by any court of  competent
 jurisdiction  to  be invalid, such judgment shall not affect, impair, or
 invalidate the remainder thereof, but shall be confined in its operation
 to the clause, sentence, paragraph, subdivision, section or part thereof
 directly involved in the controversy in which such judgment  shall  have
 been rendered. It is hereby declared to be the intent of the legislature
 that  this  act  would have been enacted even if such invalid provisions
 had not been included herein.
   § 10. This act shall take effect immediately.