BILL NUMBER:S3026

TITLE  OF  BILL:    An act to amend the racing, pari-mutuel wagering and
breeding law, in relation  to  antitrust  exemptions  for  horse  racing
agreements

PURPOSE:    To  permit  racetracks  and  other racing event producers or
retailers to band together to establish agreements governing the  sched-
uling  of  their  races  and to establish joint agreements involving the
sale and purchase of broadcasting and simulcasting rights.

SUMMARY OF PROVISIONS:

Section 1; Adds a new Racing & Wagering Law section 113-a to grant anti-
trust immunity to certain agreements  among  entities  licensed  by  the
State  Gaming  Commission  to  conduct wagering. These entities would be
granted anti-trust immunity to develop agreements which  coordinate  the
dates and times of their races and are also given immunity to enter into
contracts  involving  the  joint  purchase  or sale of their broadcasts,
simulcasts, and electronic transmissions. All such  agreements  must  be
approved  by  the  State Gaming Commission and the NYS Attorney General.
The standard of review is that such agreements must protect the  contin-
ued viability of the State's horse racing and agricultural industries.

EXISTING LAW:  Such agreements may, under current law, violate the State
and Federal anti-trust laws.
              

JUSTIFICATION:   Attendance at racetracks and real betting handle in New
York has been falling rapidly for the past 40 years. Racetracks  need  a
better   way   of   competing  with  other  gambling  and  entertainment
attractions. This bill allows such racing event producers and  retailers
to  combine forces to make joint arrangements on both the scheduling and
the times of their races, or  to  sell  and/or  purchase  broadcast  and
simulcast rights. Making such joint cooperative arrangements may lead to
better  national  market  penetration of the State's racing products and
help to reduce overhead costs and competition among  New  York's  racing
producers   so  that  OTB's  can  effectively  market  each  racetrack's
products.

All agreements would need to be approved by the State Gaming  Commission
and  the NYS Attorney General so that only those agreements that promote
the State's legitimate interests in advancing our local horse racing and
agricultural industries would be approved. This bill ensures that future
joint agreements do not run afoul of the Federal  and  State  anti-trust
laws.  It  is  arguable that some joint arrangements between competitive
racetracks could pose antitrust questions.  The  need  to  preserve  the
State's ailing racetracks should, however, outweigh any limited anticom-
petitive  effects of any joint marketing or horse race production agree-
ments: The U.S. Supreme Court, under Parker v. Brown, 317 US 341  (1943)
grants states the statutory authority to confer immunity for the Sherman
Anti-trust  Act for certain government sanctioned activities. The second

section of this bill is modeled on 15 U.S.C. Section 1291  which  grants
anti-trust immunity to broadcasts for certain professional leagues.

LEGISLATIVE HISTORY:  2010: S.6197 - Referred to Racing, Gaming & Wager-
ing 2011: S.623 - This bill while similar to the current bill,
      has additional safeguards included to protect the
      public interest and reflects the concerns outlined
      in  Veto  Message  27 of S.623.   2012: S. 7170 (Klein) / A. 10310
(Pretlow)

FISCAL IMPLICATIONS: None.

LOCAL FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: 180 days after it shall have become law.