Original Notice.

     Preproposal statement of inquiry was filed as WSR 05-11-113.

     Title of Rule and Other Identifying Information: WAC 260-49-070 Distribution of source market fee.

     Hearing Location(s): Auburn City Council Chambers, 25 West Main, Auburn, WA 98001, on September 8, 2005, at 9:30 a.m.

     Date of Intended Adoption: September 8, 2005.

     Submit Written Comments to: Robert J. Lopez, 6326 Martin Way, Suite 209, Olympia, WA 98516-5578, e-mail rlopez@whrc.state.wa.us, fax (360) 459-6461, by September 6, 2005.

     Assistance for Persons with Disabilities: Contact Patty Sorby by September 6, 2005, TTY (360) 459-6462.

     Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: To amend portions of WAC 260-49-070 to allow an authorized advance deposit wagering service provider to pay 90% of the source market fee to the class 1 racing association quarterly rather than monthly, while at the same time still requiring 10% of the source market fee to be paid to the commission monthly.

     Reasons Supporting Proposal: Provides more flexible payment options to the authorized advanced deposit wagering service provider, while at the same time still requiring payment to the state monthly.

     Statutory Authority for Adoption: RCW 67.16.020.

     Rule is not necessitated by federal law, federal or state court decision.

     Name of Proponent: Northwest Racing Association dba Emerald Downs Racetrack, private.

     Name of Agency Personnel Responsible for Drafting: Robert J. Lopez, 6326 Martin Way, Suite 209, Olympia, WA 98516-5578, (360) 459-6462; Implementation and Enforcement: Robert M. Leichner, 6326 Martin Way, Suite 209, Olympia, WA 98516-5578, (360) 459-6462.

     No small business economic impact statement has been prepared under chapter 19.85 RCW. Not applicable.

     A cost-benefit analysis is not required under RCW 34.05.328. Not applicable.

July 29, 2005

R. M. Leichner

Executive Secretary

OTS-8223.1

AMENDATORY SECTION(Amending WSR 04-21-053, filed 10/18/04, effective 11/18/04)

WAC 260-49-070   Distribution of source market fee.   (1) A source market fee shall be paid ((monthly)) for the source market fee area on all accounts that have Washington as the principal residence address.

     (2) The authorized advance deposit wagering service provider shall((, at least monthly,)) distribute the total source market fee as follows:

     (a) At least quarterly, ninety percent of the total source market fee shall be distributed directly to the class 1 racing association and ((the remaining)) at least monthly ten percent of the source market fee shall be distributed directly to the commission.

     (((b))) (3) The class 1 racing association shall distribute two and one-half percent of the total source market fee to the breeders' award fund.

     (((c))) (4) The class 1 racing association and the recognized horsemen's organization shall negotiate a separate agreement for contributions to the purse account from the source market fee and submit the agreement for review and approval by the commission. The class 1 racing association shall distribute the horsemen's share of the source market fee in accordance with the horseman's agreement.

     (((d))) (5) The commission shall distribute two and one-half percent of the total source market fee to the Washington bred owners' bonus account and one-half of one percent of the total source market fee to the class C purse fund account and seven percent of the total source market fee to the commission's operating account.

     (((3))) (6) The commission shall annually review the distribution of the source market fee. Any changes to the distribution shall be adopted by rule.

[Statutory Authority: RCW 67.16.020. 04-21-053, § 260-49-070, filed 10/18/04, effective 11/18/04.]

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