AN ACT Relating to benefiting the equine industry by parimutuel satellite and simulcast wagering restricted to live racing facilities and providing lottery games; amending RCW 67.16.050, 67.16.105, and 67.16.200; creating a new section; repealing RCW 67.16.190 and 67.16.250; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The legislature finds that Washington's equine racing industry creates economic, environmental, and recreational impacts across the state affecting agriculture, horse breeding, the horse training industry, agricultural fairs and youth programs, and tourism and employment opportunities. The Washington equine industry has incurred a financial decline stemming from the direct competition of gambling enterprises operated within the state. This act is necessary to preserve, restore, and revitalize the equine breeding and racing industries and to preserve in Washington the economic impacts associated with these industries. This act is not a new form of gaming in Washington. Tribal state compacts for class III gaming may not be amended based upon this act.

Sec. 2. RCW 67.16.050 and 1985 c 146 s 3 are each amended to read as follows:

Every person making application for license to hold a race meet, under the provisions of this chapter shall file an application with the commission which shall set forth the time, the place, the number of days such meet will continue, and such other information as the commission may require. The commission shall be the sole judge of whether or not the race meet shall be licensed and the number of days the meet shall continue. No person who has been convicted of any crime involving moral turpitude shall be issued a license, nor shall any license be issued to any person who has violated the terms or provisions of this chapter, or any of the rules and regulations of the commission made pursuant thereto, or who has failed to pay to the commission any or all sums required under the provisions of this chapter. The license shall specify the number of days the race meet shall continue and the number of races per day, which shall ((be)) include not less than six nor more than eleven live races per day, and for which a fee shall be paid daily in advance of five hundred dollars for each live race day for those ((~~meets~~)) licensees which had gross receipts from parimutuel machines in excess of fifty million dollars in the previous year and two hundred dollars for each day for meets which had gross receipts from parimutuel machines at or below fifty million dollars in the previous year; in addition any newly authorized live race meets shall pay two hundred dollars per day for the first year: PROVIDED, That if unforeseen obstacles arise, which prevent the holding, or completion of any race meet, the license fee for the meet, or for a portion which cannot be held may be refunded the licensee, if the commission deems the reasons for failure to hold or complete the race meet sufficient. Any unexpired license held by any person who violates any of the provisions of this chapter, or any of the rules or regulations of the commission made pursuant thereto, or who fails to pay to the commission any and all sums required under the provisions of this chapter, shall be subject to cancellation and revocation by the commission. Such cancellation shall be made only after a summary hearing before the commission, of which three days' notice, in writing, shall be given the licensee, specifying the grounds for the proposed cancellation, and at which hearing the licensee shall be given an opportunity to be heard in opposition to the proposed cancellation.

Sec. 3. RCW 67.16.105 and 1995 c 173 s 2 are each amended to read as follows:

(1) Licensees of race meets that are nonprofit in nature, are of ten days or less, and have an average daily handle of one hundred twenty thousand dollars or less shall withhold and pay to the commission daily for each authorized day of racing one-half percent of the daily gross receipts from all parimutuel machines at each race meet.

(2) Licensees ((~~of race meets~~)) that do not fall under subsection (1) of this section shall withhold and pay to the commission ((~~daily for each authorized day of racing~~)) the following applicable percentage of all daily gross receipts from ((~~all~~)) its in-state parimutuel machines ((~~at each race meet~~)):

(a) If the daily gross receipts of all its in-state parimutuel machines are more than two hundred fifty thousand dollars, the licensee shall withhold and pay to the commission daily two and one-half percent of the daily gross receipts; and

(b) If the daily gross receipts of all its in-state parimutuel machines are two hundred fifty thousand dollars or less, the licensee shall withhold and pay to the commission daily one percent of the daily gross receipts.

(3) In addition to those amounts in subsections (1) and (2) of this section, ((~~all~~)) a licensee((s)) shall forward one-tenth of one percent of the daily gross receipts of all its in-state parimutuel machines to the commission ((~~daily~~)) for payment to those nonprofit race meets as set forth in RCW 67.16.130 and subsection (1) of this section, but said percentage shall not be charged against the licensee((~~s. The total of such payments shall not exceed one hundred fifty thousand dollars in any one year and any amount in excess of one hundred fifty thousand dollars shall be remitted to the general fund~~)). Payments to nonprofit race meets under this subsection shall be distributed on a pro rata per-race-day basis and used only for purses at race tracks that have been operating under RCW 67.16.130 and subsection (1) of this section for the five consecutive years immediately preceding the year of payment.

(((4) In addition to those sums paid to the commission in subsection (2) of this section, licensees who are nonprofit corporations and have race meets of thirty days or more shall retain and dedicate: (a) An amount equal to one and one-quarter percent of the daily gross receipts of all parimutuel machines at each race meet to be used solely for the purpose of increasing purses; and (b) an amount equal to one and one-quarter percent of the daily gross receipts of all parimutuel machines at each race meet to be deposited in an escrow or trust account and used solely for construction of a new thoroughbred race track facility in western Washington. Said percentages shall come from that amount the licensee is authorized to retain under RCW 67.16.170(2). The commission shall adopt such rules as may be necessary to enforce this subsection.

(5) In the event the new race track is not constructed before January 1, 2001, all funds including interest, remaining in the escrow or trust account established in subsection (4) of this section, shall revert to the state general fund.))

Sec. 4. RCW 67.16.200 and 1991 c 270 s 10 are each amended to read as follows:

(1) A racing association licensed by the commission to conduct a race meet may seek approval from the commission to conduct parimutuel wagering on its program at a satellite location or locations within the state of Washington. The sale of parimutuel pools at satellite locations shall be conducted only during the licensee's race meet and simultaneous to all parimutuel wagering activity conducted at the licensee's live racing facility in the state of Washington. The commission's authority to approve satellite wagering at a particular location is subject to the following limitations:

(a) The commission may approve only one satellite location in each county in the state; however, the commission may grant approval for more than one licensee to conduct wagering at each satellite location((.

(b) The commission shall not allow a licensee to conduct satellite wagering at a satellite location within twenty ground miles of the licensee's racing facility. For purposes of this section, "ground miles" means miles measured from point to point in a straight line.

(c)(i) The commission may allow a licensee to conduct satellite wagering at a satellite location within fifty ground miles of the racing facility of another licensee who conducts race meets of thirty days or more, but only if the satellite location is the racing facility of another licensee who conducts race meets of thirty days or more and only if the licensee seeking to conduct satellite wagering suspends its program during the conduct of the meets of all licensees within fifty ground miles; except that the commission may allow a licensee that conducts satellite wagering at another track, pursuant to this subsection, to use other satellite locations, used by that track with the approval of the owner of that track, even though those satellite locations are within a fifty ground mile radius.

(ii) Subject to subsection (1)(c)(i) of this section, the commission may allow a licensee to conduct satellite wagering at a satellite location within fifty ground miles of the racing facility of another licensee who conducts race meets of under thirty days, but only if the licensee seeking to conduct satellite wagering suspends its satellite program during the conduct of the meets of all licensees within fifty ground miles)). A satellite location shall not be operated within twenty driving miles of any class 1 racing facility. For the purposes of this section, "driving miles" means miles measured by the most direct route as determined by the commission; and

(b) A licensee shall not conduct satellite wagering at any satellite location within sixty driving miles of any other racing facility conducting a live race meet.

(2) Subject to local zoning and other land use ordinances, the commission shall be the sole judge of whether approval to conduct wagering at a satellite location shall be granted.

(3) The licensee shall combine the parimutuel pools of the satellite location with those of the racing facility for the purpose of determining odds and computing payoffs. The amount wagered at the satellite location shall be combined with the amount wagered at the racing facility for the application of take out formulas and distribution as provided in RCW 67.16.102, 67.16.105, 67.16.170, and 67.16.175. A satellite extension of the licensee's racing facility shall be subject to the same application of the rules of racing as the licensee's racing facility.

(4) Upon written application to the commission, a class 1 racing association may be authorized to transmit simulcasts of live horse races conducted at its racetrack to locations outside of the state of Washington approved by the commission and in accordance with the interstate horse racing act of 1978 (15 U.S.C. Sec. 3001 to 3007) or any other applicable laws. The commission may permit parimutuel pools on the simulcast races to be combined in a common pool. A racing association that transmits simulcasts of its races to locations outside this state shall pay at least fifty percent of the fee that it receives for sale of the simulcast signal to the horsemen's purse account for its live races after first deducting the actual cost of sending the signal out of state.

(5) Upon written application to the commission, a class 1 racing association may be authorized to transmit simulcasts of live horse races conducted at its racetrack to licensed racing associations located within the state of Washington and approved by the commission for the receipt of the simulcasts. The commission shall permit parimutuel pools on the simulcast races to be combined in a common pool. The fee for in-state, track-to-track simulcasts shall be five and one-half percent of the gross parimutuel receipts generated at the receiving location and payable to the sending racing association. A racing association that transmits simulcasts of its races to other licensed racing associations shall pay at least fifty percent of the fee that it receives for the simulcast signal to the horsemen's purse account for its live race meet after first deducting the actual cost of sending the simulcast signal. A racing association that receives races simulcast from class 1 racing associations within the state shall pay at least fifty percent of its share of the parimutuel receipts to the horsemen's purse account for its live race meet after first deducting the purchase price and the actual direct costs of importing the race.

(6) A class 1 racing association may be allowed to import simulcasts of horse races from out-of-state racing facilities. With the prior approval of the commission, the class 1 racing association may participate in an interstate common pool and may change its commission and breakage rates to achieve a common rate with other participants in the common pool.

(a) The class 1 racing association shall make written application with the commission for permission to import simulcast horse races for the purpose of parimutuel wagering. Subject to the terms of this section, the commission is the sole authority in determining whether to grant approval for an imported simulcast race.

(b) During the conduct of its race meeting, a class 1 racing association may be allowed to import no more than one simulcast race card program during each live race day. A licensed racing association may also be approved to import one simulcast race of regional or national interest on each live race day. A class 1 racing association may be permitted to import two simulcast programs on two nonlive race days per each week during its live meet. A licensee shall not operate parimutuel wagering on more than five days per week. Parimutuel wagering on imported simulcast programs shall only be conducted at the live racing facility of a class 1 racing association.

(c) The commission may allow simulcast races of regional or national interest to be sent to satellite locations. The simulcasts shall be limited to one per day except for Breeder's Cup special events day.

(d) When open for parimutuel wagering, a class 1 racing association which imports simulcast races shall also conduct simulcast parimutuel wagering within its licensed racing enclosure on all races simulcast from other class 1 racing associations within the state of Washington.

(e) When not conducting a live race meeting, a class 1 racing association may be approved to conduct simulcast parimutuel wagering on imported simulcast races. The conduct of simulcast parimutuel wagering on the simulcast races shall be for not more than twelve hours during any twenty-four hour period, for not more than five days per week and only at its live racing facility.

(f) On any imported simulcast race, the class 1 racing association shall pay fifty percent of its share of the parimutuel receipts to the horsemen's purse account for its live race meet after first deducting the purchase price of the imported race and the actual costs of importing the race.

(7) For purposes of this section, a class 1 racing association is defined as a licensee approved by the commission which conducts during each twelve-month period at least forty days of live racing within four successive calendar months. The commission may by rule increase the number of live racing days required to maintain class 1 racing association status.

(8) This section does not establish a new form of gaming in Washington or allow expanded gaming within the state beyond what has been previously authorized. This section is necessary to protect the Washington equine breeding and racing industries. The purpose of this section is to protect live horseracing and promote fan attendance at class I racing facilities. Therefore, imported simulcast race card programs shall not be disseminated to any location outside the live racing facility of the class I racing association and tribal-state compacts for class III gaming shall not be amended based upon this section.

NEW SECTION. Sec. 5. The following acts or parts of acts are each repealed:

(1) RCW 67.16.190 and 1985 c 146 s 12 & 1981 c 70 s 3; and

(2) RCW 67.16.250 and 1994 c 159 s 3 & 1991 c 270 s 12.

NEW SECTION. Sec. 6. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 7. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately.