Senate Bill S7578A

                                BILL NUMBER:S7578A

TITLE OF BILL:
An act to amend the racing, pari-mutuel wagering and breeding law, in
relation to the New York state thoroughbred breeding and development
fund; and providing for the repeal of such provisions upon expiration
thereof

PURPOSE OR GENERAL IDEA OF BILL:
This bill provides flexibility to the thoroughbred breeding fund in an
effort to help offset major decreases in the amount of monies the fund
takes in.

SUMMARY OF SPECIFIC PROVISIONS:
Section one of the bill amends paragraph a of subdivision 1 and para-
graphs a, e, and f of subdivision two of section 254 of the racing,
pari-mutuel wagering and breeding law to require payments to be made to
the fund on a quarterly basis.

In addition, section one increases the percentage of revenue that can be
allotted to breeder awards from fifty percent, up to 65 percent.

The amount of money used for promoting the breeding and raising of
thoroughbred horses is also increased by one percent to an amount up to
six percent.

              

Finally, administrative allotments from the fund are increased from 4
percent up to 5 percent.

Section two is the effective date. This act is deemed repealed upon
commencement of operation of the VLT facility at Aqueduct racetrack.

JUSTIFICATION:
The New York State Thoroughbred Breeding and Development Fund, estab-
lished in 1973, has helped shape the New York State thoroughbred indus-
try, making it the benchmark of thoroughbred programs around the world.
For over two decades, the Fund has worked to make thoroughbred breeding
and racing a vital force in New York State's economy, utilizing its rich
racing tradition, vast agricultural resources, and thriving tourism
industry. The Fund is a public benefit corporation that oversees the
registration process for foals and stallions, and distributes incentives
awards to breeders, owners, and stallion owners. The incentives provided
by the Fund are financed from within the racing industry, using a small
percentage of the total monies wagered through the pari-mutuel system on
thoroughbred racing in New York State.

Thoroughbred Breeders use this funding to invest back into breeding,
thereby keeping that money in the local economy and creating more jobs,
and strengthening the horse racing industry in New York.

The New York Racing and Breeding Program has evolved significantly since
1973. The goals set out for the Fund have been well accomplished, espe-

cially in the last decade. However, the industry has seen significant
declines in handle year after year. With that, the Fund's revenue has
rapidly fallen each year placing a burden on the ability to pay awards
to participants at advertised rates within the statutory cap as the
Breeding Program has grown. Additionally, Governmental Accounting Stand-
ards Board (GASB 45) regulations have required the Fund to account for
administrative costs years ahead.  Therefore, the Board of Directors of
the Thoroughbred Breeding Fund require the ability to allot Fund revenue
based on the current state of the Thoroughbred industry. To do so, the
statutory limitations on Fund allocations need further room for growth
to accommodate awards earned and revenue at hand to the Fund.  This is a
housekeeping modification that has no financial impact on any other
organization or segment of the industry.

NY Thoroughbred Breeders are a key sector of New York's agricultural
economy, which is the number one agri-business for New York.  Thorough-
bred Breeders have a significant, positive impact on the upstate economy
by providing jobs, protecting open space, preserving property values and
contributing to the overall state and local economies. Thoroughbred
breeders play a central role in strengthening New York's horse racing
industry by helping maintain the highest levels of racing, and producing
superior quality thoroughbreds. New York thoroughbred farms range from
large commercial facilities to smaller family owned operations, who are
struggling to make ends meet. New York is home to over 400 thoroughbred
breeding farms utilizing 43,000 acres of working landscape or "green
space."  Spending by suppliers and employees generates additional jobs
in New York for a total employment impact of over 35,000 agribusiness
jobs.

PRIOR LEGISLATIVE HISTORY:
This is a new bill.

FISCAL IMPLICATION:
None to the state.

EFFECTIVE DATE:
Immediately.