S T A T E O F N E W Y O R K
________________________________________________________________________
8415
2019-2020 Regular Sessions
I N A S S E M B L Y
June 16, 2019
___________
Introduced by M. of A. PRETLOW -- read once and referred to the Commit-
tee on Ways and Means
AN ACT to amend the tax law, in relation to video lottery gaming located
in Orange county
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Clause (B) of subparagraph (ii) of paragraph 1 of subdivi-
sion b of section 1612 of the tax law is amended by adding a new item 5
to read as follows:
(5) THIRTY PERCENT FOR A VIDEO LOTTERY GAMING FACILITY AUTHORIZED
PURSUANT TO PARAGRAPH FIVE OF SUBDIVISION A OF SECTION SIXTEEN HUNDRED
SEVENTEEN-A OF THIS ARTICLE;
§ 2. Paragraph 2 of subdivision b of section 1612 of the tax law, as
amended by section 1 of part OO of chapter 59 of the laws of 2014, is
amended to read as follows:
2. As consideration for the operation of a video lottery gaming facil-
ity, the division, shall cause the investment in the racing industry of
a portion of the vendor fee received pursuant to paragraph one of this
subdivision in the manner set forth in this subdivision. With the
exception of Aqueduct racetrack, A VIDEO LOTTERY GAMING FACILITY AUTHOR-
IZED 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 operated by a corporation established pursuant to
section five hundred two of the racing, pari-mutuel wagering and breed-
ing 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)[, (E),
(F), or (G)] of subparagraph (ii) of paragraph one of this subdivision,
for the purpose of enhancing purses at such track, 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
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD13420-02-9
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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. One and one-half
percent of the gross purse enhancement amount at a thoroughbred track,
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 Aqueduct race-
track, 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 operated by a
corporation established pursuant to section five hundred two of the
racing, pari-mutuel wagering and breeding law, one and one-quarter
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)[, (E), (F), or (G)] of subparagraph (ii) of paragraph one of this
subdivision, shall be distributed to the appropriate breeding fund for
the manner of racing conducted by such track.
Provided, further, that nothing in this paragraph shall prevent each
track from entering into an agreement, not to exceed five years, with
the organization authorized to represent its horsemen to increase or
decrease the portion of its vendor fee dedicated to enhancing purses at
such track during the years of participation by such track, or to race
fewer dates than required herein.
§ 3. Subdivision h of section 1612 of the tax law, as amended by chap-
ter 174 of the laws of 2013, is amended to read as follows:
h. As consideration for the operation of a video lottery gaming
[resort] facility located in [Sullivan] ORANGE county, the division
shall cause the investment in the racing industry 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 Sulli-
van county [and to the agriculture and New York state horse breeding
development fund to maintain racing support payments at the same dollar
levels 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] IN AN AMOUNT
EQUAL TO EIGHT AND THREE-QUARTERS PERCENT OF THE TOTAL REVENUE WAGERED
AT A VIDEO LOTTERY GAMING FACILITY LOCATED IN ORANGE COUNTY, AFTER
PAYOUT OF PRIZES. IN ADDITION, ONE AND ONE-QUARTER PERCENT OF TOTAL
REVENUE WAGERED AT A VIDEO LOTTERY GAMING FACILITY LOCATED IN ORANGE
COUNTY AFTER PAYOUT OF PRIZES, RECEIVED PURSUANT TO CLAUSE (B) OF
SUBPARAGRAPH (II) OF PARAGRAPH ONE OF SUBDIVISION B OF THIS SECTION,
SHALL BE DISTRIBUTED TO THE APPROPRIATE BREEDING FUND FOR RACING
CONDUCTED BY A RACETRACK LOCATED IN SULLIVAN COUNTY. 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.
§ 4. Paragraphs 3 and 4 of subdivision a of section 1617-a of the tax
law, as added by section 1 of part SS of chapter 60 of the laws of 2016,
are amended and a new paragraph 5 is added to read as follows:
(3) a maximum of two facilities, which shall be vendors for all
purposes under this article, neither to exceed one thousand video
lottery gaming devices, established within region three of zone one as
A. 8415 3
defined by section one thousand three hundred ten of the racing, pari-
mutuel wagering and breeding law, one each operated by a corporation
established pursuant to section five hundred two of the racing, pari-mu-
tuel wagering and breeding law in the Suffolk region and the Nassau
region to be located within a facility authorized pursuant to sections
one thousand eight or one thousand nine of the racing, pari-mutuel
wagering and breeding law; [and]
(4) Aqueduct racetrack, within the lottery terminal facility, pursuant
to an agreement between the corporation established pursuant to section
five hundred two of the racing, pari-mutuel wagering and breeding law in
the Nassau region and the operator of video lottery gaming at Aqueduct
racetrack, when such agreement is approved by the gaming commission and
as long as such agreement is in place, and when such agreement is accom-
panied by a detailed spending plan for the corporation established
pursuant to section five hundred two of the racing, pari-mutuel wagering
and breeding law in the Nassau region, which includes a plan for the
timely payment of liabilities due to the franchised corporation, and
when such video lottery devices are hosted by the operator of video
lottery gaming at Aqueduct racetrack on behalf of the corporation estab-
lished pursuant to section five hundred two of the racing, pari-mutuel
wagering and breeding law in the Nassau region in lieu of the develop-
ment of a facility in Nassau county as authorized by paragraph three of
subdivision a of this section. Such agreement reached by the parties
shall identify the agency principally responsible for funding, approving
or undertaking any actions of such agreement. Provided, however, noth-
ing in this paragraph shall infringe upon the rights of the corporation
established pursuant to section five hundred two of the racing, pari-mu-
tuel wagering and breeding law in the Nassau region to develop a facili-
ty pursuant to paragraph three of this subdivision upon the expiration,
termination, or withdrawal of such agreement[.]; AND
(5) AT A FACILITY WITHIN ORANGE COUNTY TO BE OPERATED BY THE ENTITY
OTHERWISE LICENSED TO OPERATE VIDEO LOTTERY GAMING AT A RACETRACK
LOCATED IN SULLIVAN COUNTY, PROVIDED THAT: (I) A GAMING FACILITY, AS
DEFINED IN SECTION THIRTEEN HUNDRED ONE OF THE RACING, PARI-MUTUEL
WAGERING AND BREEDING LAW, LOCATED IN ZONE TWO OF REGION ONE, HAS MAIN-
TAINED NINETY PERCENT OF FULL-TIME EQUIVALENT EMPLOYEES AS THEY EMPLOYED
IN THE FIRST QUARTER OF THE FISCAL YEAR TWO THOUSAND NINETEEN; (II) SUCH
LICENSED ENTITY IS NO LONGER OPERATING VIDEO LOTTERY GAMING AT A RACE-
TRACK LOCATED IN SULLIVAN COUNTY AND SO LONG AS THE RACETRACK LOCATED IN
SULLIVAN COUNTY IS CONDUCTING RACING; (III) SUCH FACILITY IN ORANGE
COUNTY IS NOT SITED WITHIN A THIRTY MILE RADIUS OF THE VIDEO LOTTERY
GAMING FACILITY AT A RACETRACK LOCATED IN WESTCHESTER COUNTY; (IV) THE
LICENSED ENTITY, ITS SUBSIDIARIES AND AFFILIATES, INCLUDING THE ENTITY
LICENSED TO OPERATE A COMMERCIAL GAMING FACILITY IN SULLIVAN COUNTY, AND
ORANGE COUNTY ENTER INTO A MITIGATION AGREEMENT TO BE PAID OUT OF THE
VENDOR FEE FOR THE FACILITY LOCATED IN ORANGE COUNTY, TO BE APPROVED BY
THE GAMING COMMISSION; (V) 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 GAMES AT YONKERS RACETRACK AND THE STATUTORILY RECOGNIZED
HORSEMEN'S ASSOCIATION AT YONKERS RACETRACK ENTER INTO A MITIGATION
AGREEMENT, TO BE APPROVED BY THE GAMING COMMISSION, WHICH SHALL INCLUDE,
BUT NOT BE LIMITED TO, TERMS THAT REQUIRE THE OPERATOR OF THE FACILITY
IN ORANGE COUNTY TO MAKE AN ANNUAL PAYMENT, TO BE PAID OUT OF THE VENDOR
FEE OF A FACILITY LOCATED IN ORANGE COUNTY TO THE ENTITY LICENSED TO
OPERATE VIDEO LOTTERY GAMING, OR UPON CONVERSION OF SUCH LICENSE, TO THE
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ENTITY LICENSED TO OPERATE A COMMERCIAL GAMING FACILITY AT YONKERS RACE-
TRACK AND THE STATUTORILY RECOGNIZED HORSEMEN'S ASSOCIATION 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 AND UPON PURSES AND BREEDING
FUND PAYMENTS FROM YONKERS RACETRACK; AND (VI) THE LICENSED ENTITY, ITS
SUBSIDIARIES AND AFFILIATES, INCLUDING THE ENTITY LICENSED TO OPERATE A
COMMERCIAL GAMING FACILITY IN SULLIVAN COUNTY, AND SULLIVAN COUNTY ENTER
INTO A MITIGATION AGREEMENT TO BE PAID OUT OF THE VENDOR FEE FOR THE
FACILITY LOCATED IN ORANGE COUNTY, 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 SULLIVAN COUNTY TO MAINTAIN FUNDING AT THE SAME DOLLAR LEVELS
REALIZED IN TWO THOUSAND EIGHTEEN; AND (B) THAT UPON EXPIRATION, TERMI-
NATION, OR WITHDRAWAL 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 OPERATING
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.
§ 5. 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. (I) Notwithstanding any provision of law to the contrary, free
play allowance credits authorized by the division pursuant to subdivi-
sion 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 payable to the division's video lottery gaming equipment contrac-
tors, or racing support payments.
(II) A VIDEO LOTTERY GAMING FACILITY LOCATED IN ORANGE COUNTY SHALL
NOT UTILIZE FREE PLAY CREDITS.
§ 6. This act shall take effect immediately; provided, however, that
no video lottery gaming may be conducted at any facility within Orange
county unless and until the mitigation agreement required by this act is
executed by all parties and approved by the gaming commission.